Obligation to disclose the beneficial owners of enterprises

All companies registered in Latvia are obliged to submit information on their beneficial owners to the Register of Enterprises of the Republic of Latvia (the Register of Enterprises) until March 1, 2018.

The obligation follows the recent amendments to the Law on the Prevention of Money Laundering and Terrorism Financing. The amendments impose an obligation to all companies to register their beneficial owners and record the related changes in the Register of Enterprises.

The beneficial owner is a natural person who holds or controls at least 25% of the legal entity's shares or voting shares in a direct or indirect ownership. The beneficial owner is also the person who controls a legal entity or establishes business relations on behalf of or in the interests of the real beneficiary, as well as carries out occasional transaction.

Registration of beneficial owners

In order to register a beneficial owner, a special application form must be submitted to the Register of Enterprises indicating the way the beneficial owner controls the company, including information on how the intermediary persons involved ensure the control. As well, information including personal data of the beneficiaries must be provided.

In event of deliberately false reporting to the Register of Enterprises, a person may be held liable as per the procedures specified in the Criminal Law.

As of April 1, 2018, the information on the beneficial owners will be available online to each person upon payment of the state fee.

In case you have any question on registration of the beneficial owners or you need assistance related to the above obligations, please contact Managing lawyer of Leinonen Latvia Jānis Ozoliņš (janis.ozolins@leinonen.lv).