End of tolerance period for non-compliant UBO registrations

Since the end of 2019, all Belgian companies, foundations and non-profit organizations are obliged to register their ultimate beneficial owners (UBOs) in the UBO register. Yet there are still many that have failed to register or have done so without fully complying with the regulations.

Obligation to register UBO information

The European Union, and by extension the Belgian Federal Public Service Finance (FPS Finance) consider the UBO register as a crucial tool in the fight against financial crime, including money laundering and terrorist financing. It has been implemented to promote transparency, help prevent illegal financial activities and strengthen the integrity of the financial system.

Despite the legal obligation and reminders from the FPS Finance, almost four years after the deadline for registration, more than 15,000 companies and more than 40,000 non-profit organizations and foundations still do not comply with the obligation to register their UBOs.

End of tolerance period

The FPS Finance initially took a flexible approach towards situations where entities subject to the UBO regulations had registered their UBO information but did not fully comply with the procedure. In practice this meant that a finding of an incorrect registration did not automatically lead to a penalty. However, the UBO website of the FPS Finance now clearly states that this “tolerance period” has ended with effect as from August 16th, 2023. Those who remain non-compliant with their UBO obligations risk significant fines. The FPS Finance has already issued 15,776 fines of 500 euros each for non-compliance with the registration obligation (up to now in case of a lack of any form of registration). These fines have raised more than 4 million euros to date.

Necessity of a correct UBO registration and the upload of supporting documents

It is essential for Belgian companies, foundations and non-profit organizations to properly maintain and monitor their UBO registration to avoid legal sanctions. This includes keeping the registered information up-to-date and providing relevant supporting documents to confirm the accuracy of the information.

Conclusion

As the tolerance period has ended, it is now more than ever in the interest of all Belgian companies, non-profit organizations and foundations and their directors to make sure that they comply with the UBO regulations. Besides keeping the registered information in the UBO register up to date, it remains equally important to upload the necessary supporting documents as they form an integral part of the registration.

As always, our committed team of experts is ready to support you with all your UBO queries. Do not hesitate to reach out to us with any queries you may have.