On June 11, 2021 the Order of the Ministry of Finance of Ukraine No. 163 as of 19/03/2021 (hereinafter referred to as the “Order“), which sets forth the requirements to the ownership structure of legal entities was published. The Order shall become effective in one month from the date of its official publication.
The ownership structure is an official document which has to be filed to a state registrar in order to determine the beneficial owner of a legal entity. Respective document shall be filed in a free form and shall be a schematic representation to show all persons directly or indirectly owning the Ukrainian legal entity either independently or jointly with other persons.
It should be noted that according to the requirements of clause 4 of the Transitional Provisions of the Law of Ukraine “On Preventing and Counteracting Legitimization (Money Laundering) of Proceeds of Crime, Terrorism Financing and Financing of the Proliferation of Weapons of Mass Destruction” (hereinafter referred to as the “Law”), legal entities registered prior to 28/04/2020 must submit information about the beneficial owner and the ownership structure to a state registrar within three months from the date the Order becomes effective.
Furthermore, according to clause 22 of Article 17 of the Law of Ukraine “On State Registration of Legal Entities, Individual Entrepreneurs and Public Associations”, legal entities are obliged to maintain the information about the beneficial owner and the ownership structure up-to-date, update it and notify a state registrar of any changes thereof within 30 business days from the date such changes have occurred, as well as to submit documents confirming such changes to a state registrar.
Also, on a yearly basis commencing from the year following the date of the state registration of a legal entity, legal entities shall submit the ownership structure and shall confirm details of the beneficial owner within 14 calendar days.
As soon as the Order becomes effective, the ownership structure shall be subject to submitting when performing most registration actions in respect of a legal entity.
Legislation prescribes a fine in the amount of UAH 17,000 to UAH 51,000 to be imposed on the executives of a legal entity for failure to submit or late submission to a state registrar of the information on the beneficial owner or his/her absence, or of the documents to confirm the information on the beneficial owner of a legal entity (including the ownership structure of a legal entity).
Our assistance may include:
- conducting analysis of the corporate structure of your company;
- filing information on the beneficial owner and the ownership structure of your company according to the requirements of the Law;
- providing comprehensive explanations and advice on compliance with the legislative requirements to avoid penalties.