The Department of the Registrar of Companies and Intellectual Property (DRCIP) has recently announced important changes to the implementation framework of the Register of Beneficial Owners. These changes are introduced under Law No. 141(I)/2024, which amends the Prevention and Suppression of Money Laundering Activities Law of 2007 (the ‘AML Legislation’).

These changes seek to enhance compliance, alleviate the financial burden on – small and medium-sized Companies—and promote transparency in accordance with international standards. The key changes include:

1. Financial Penalties

Financial penalties will now be imposed solely on companies or legal entities that fail, neglect, or refuse to fulfill their obligations to submit information on their Beneficial Owners, as required by the AML Legislation and related guidelines, without the imposition of additional penalties on Company Directors and Secretaries individually.

Irrespective of the above, Company Directors or Chief Executive Officers (CEOs) remain jointly and severally liable for the payment of penalties imposed on the Company. A financial penalty of €100 is imposed on the first day of the violation, with an additional amount of €50 imposed for each additional day that the violation persists, capped at a maximum of €5,000 per entity.

2. Enhanced Powers for the Registrar of Companies

The Registrar of Companies now has enhanced powers, including the authority to issue guidelines for the procedures of conducting an administrative review, and/or the submission and examination of appeals against financial penalties imposed.

Additionally, the Registrar can strike-off Companies or entities from the register if they fail to meet their obligations regarding Beneficial Ownership information.

The Registrar now also has the authority to request court orders compelling compliance with obligations under the AML Legislation and its related guidelines.

3. Deadlines Extended

The deadline for the submission of Beneficial Owner information has been extended to January 31, 2025. The deadline for the completion of the confirmation procedure of UBO details for 2024 has now been extended to March 31, 2025.

Non-compliance with these obligations as of February 1, 2025, will lead to the imposition of administrative and legal sanctions.

Refund of Penalties

Penalties imposed after April 1, 2024 for the delayed submission of UBO details have now been revoked, with refunds to be issued automatically for payments completed electronically.

For payments completed in person, an application will need to be submitted for the issuance of refund.

Should you wish to find out more information, contact us at info@paraschou.com.cy.