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Disclosure of real owners by companies will require new legal instruments
16.03.2016
The government brought a draft law before the State Duma imposing an obligation on companies to obtain, store and upd ate information on their ultimate owners, and, if necessary, provide it on request of governmental authorities. Non-compliance with these requirements will lead to penalties up to half a million rubles. However, the companies are not always able to find out who their beneficiary is: a complex chain of ownership, a foreign entity with offshore registration and legal restraints in other countries - all of it may become a hindrance on the way to the goal se t by the cabinet of ministers without a bag of tricks or new amendments to legislation.
Russian companies often know only their incorporators, and, at best, the incorporators of their incorporators, senior lawyer of YUST Law Firm Maxim Mesentsev told Pravo.ru portal. Obtaining information about ultimate beneficiaries is a rather long procedure, which is sometimes difficult to explain to foreign authorities. The lawyer also mentioned that the draft law provides an obligation to obtain documentary evidence, but its form may vary depending on the jurisdiction: it can be an extract from a trade register or a document signed by the company’s authorized official. It is unclear what form of confirmation will be considered appropriate.
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The government brought a draft law before the State Duma imposing an obligation on companies to obtain, store and upd ate information on their ultimate owners, and, if necessary, provide it on request of governmental authorities. Non-compliance with these requirements will lead to penalties up to half a million rubles. However, the companies are not always able to find out who their beneficiary is: a complex chain of ownership, a foreign entity with offshore registration and legal restraints in other countries - all of it may become a hindrance on the way to the goal se t by the cabinet of ministers without a bag of tricks or new amendments to legislation.Russian companies often know only their incorporators, and, at best, the incorporators of their incorporators, senior lawyer of YUST Law Firm Maxim Mesentsev told Pravo.ru portal. Obtaining information about ultimate beneficiaries is a rather long procedure, which is sometimes difficult to explain to foreign authorities. The lawyer also mentioned that the draft law provides an obligation to obtain documentary evidence, but its form may vary depending on the jurisdiction: it can be an extract from a trade register or a document signed by the company’s authorized official. It is unclear what form of confirmation will be considered appropriate.
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