Guidance

What is the meaning of BO and the obligation of submission?

Definition of beneficial owner

According to Article 2 of the Prevention and Suppression of Money Laundering Law of 2007 to 2021 hereinafter referred to as "the Law", the "beneficial owner" of a legal person is the natural person who has the ultimate ownership or control of the legal person. Ownership or control may be exercised either directly or indirectly, or in both ways, through:

• the holding of a sufficient percentage of shares; or
• voting rights; or
• significant influence or control by other means.

In the event where no natural person is identified as the beneficial owner based on the ownership rights or when there is doubt that the person identified is the beneficial owner, the details of the senior management official must be submitted.

Direct ownership

Means a shareholding of 25% plus one share or an ownership interest of more than 25% in the issued capital of the company, which is held by the natural person. See case study 1, ANNEX II in the manual.

Indirect ownership

Means a shareholding of 25% plus one share or an ownership interest of more than 25% in the issued capital of the company, which is held by the natural person through a legal entity. See case study 2, ANNEX II in the manual.

Direct and Indirect Ownership

Direct ownership (by the natural person) and indirect ownership (on behalf of the legal person) results in the natural person holding at least more than 25 % of the ownership interest, see case study 3&4, ANNEX II in the manual.

Obligation to submit details to the register

According to the Directive of the Registrar of Companies (K.Δ.Π 112/2021), every legal entity (e.g. company, partnership) and each official/partner thereof has an obligation to submit the details of its beneficial owners to the register.

According to the definition in the Companies Law, officer in relation to a legal person includes a director, manager and secretary. 

Therefore, the details of BO must be submitted to the register by the entity's own official/partner and not by a person acting on its behalf (e.g. a service provider), unless he/she is an official/partner in that entity.

*** Where, in a company, a liquidator was appointed after 12.03.21, the obligation to submit the data to the register of beneficial owners remains to the company/entity and its officials. The termination of the powers of the officers of the company by the appointment of the liquidator does not constitute the termination of their obligations as their appointment as officers in the company continues. The liquidator does not bear any responsibility or have any authority/obligation towards the register of beneficial owners.

*** In case of appointment of a Receiver/Receiver-Manager to a company after 12.03.21, the company's officers must submit the information to the register of BO upon the relevant consent/notification of the Receiver/Receiver-Manager.

In detail, these entities include:

• Cyprus Companies incorporated or registered under the Companies Law Cap.113,
• European companies,
• Partnerships

The following shall be exempted from the obligation to disclose the BO details:

• Overseas companies
• Trade names
• Company or other legal entity:

• Listed on a regulated market subject to disclosure requirements under European Union law; or
• subject to equivalent international standards ensuring adequate transparency of ownership information or
• made an application to be stricken off before 12.03.21 or whose liquidation started before 12.03.21. For exemption purposes:

• In the case of strike off, the date of sumbittion of the relevant application to the Department shall be taken into account.
• In the case of voluntary liquidation, the resolution date approving the company's liquidation shall be taken into account.
• In the case of liquidation by Court order, the date of the application sumbitted to court for liquidation.

For any questions/technical difficulties please contact Ubos@meci.gov.cy. For further information regarding the BO registry, please see the guidance and the BO FAQ's.