Spanish update: on the mandatory Central Registry of UBO

Spain has finally transposed Articles 30 and 31 of Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing(4AMLD), as amended by the 5th AML Directive into Spanish legislation through Royal Decree 609/2023 of 11 July (RD 609/2023), which creates the Central Registry of Ultimate Beneficial Owners and approves its Regulation.

What is the purpose of RD 609/2023?

The main purpose of RD 609/2023 is the creation of a central and single Registry in Spain (Spanish Central UBO Registry) that will contain information on Ultimate Beneficial Owners (UBO) of all Spanish legal entities and entities or structures without legal personality that

• have the seat of their effective management or their principal activity in Spain or

• are administered or managed by individuals or legal entities resident or established in Spain.

The Spanish Central UBO Registry will also include data on entities or structures without legal personality that, although not managed or administered from Spain or another European Union State, and not registered in another European Union State, intend to establish business relations, carry out occasional operations or acquire real estate in Spain.

RD 609/2023 also regulates who has access to the Spanish Central UBO Registry, taking into account the recent ruling of the EU Court of Justice on 22 November 2022 which limited the access to authorities, obliged subjects on anti-money laundering / combating the financing of terrorism (AML/CFT) and those that can demonstrate a legitimate interest in accessing the Spanish Central UBO Registry.

When does RD 609/2023 come into effect and what is the deadline for firms to be compliant?

RD 609/2023 comes into effect on 19 September 2023.

However, some provisions have a different deadline - for instance, entities that can show a legitimate interest in accessing the Spanish Central UBO Registry can do so from 19 October 2023.

What are the main points of RD 609/2023?

As a summary of the main features of this legal text, we highlight the following:

• The Spanish Central UBO Registry will help to effectively and efficiently combat money laundering and terrorist financing by providing access to beneficial ownership information while also allowing for the interconnection of beneficial ownership information at the European level.

• It will centralise beneficial ownership information currently available in Spain from a variety of sources (Mercantile and Property Registry,  Registry of Foundations, General Council of Notaries, etc) in addition to that which will be provided directly to it by obliged subjects.

• The different registries currently responsible for collecting beneficial ownership data will need to carry out a first transmission of data within a maximum period of 9 months from the entry into force of the Spanish Central UBO Registry.

• Until then, RD 609/2023 contemplates a single transitory provision for this case. Where there is a legitimate interest, information on UBO may be obtained by accessing the different registries and databases following their specific regulations. This will be publicised by resolution of the DGSJFP, and access will be free of charge, unless otherwise determined.

• In scope subjects that have to provide the information contained in articles 4 bis and 4 ter of Law 10/2010, of April 28^th^, on AML/CFT (Spanish AML/CFT Law) will need to make a first declaration, by electronic means, to the Spanish Central UBO Registry within two months of the entry into force of RD 304/2014, in case the information transmitted to the Central Register by the different registries is not complete. Likewise, trusts and other analogous structures must make, within two months of the entry into force of RD 304/2014, a first declaration by electronic means of the information listed in Article 4ter of Spanish AML/CFT Law.

• Beneficial ownership data must be provided by electronic means separately by the management bodies of the legal entity to the Central Register of Beneficial Ownership (or to a different competent registry, if this has a regulated declaration procedure), as well as to the database of the General Council of Notaries, through the notarial public documents, in accordance with Article 4 of RD 609/2023 and Articles 4 bis and 4 ter of Spanish AML/CFT Law, of April 28^th^. There are some particularities for trusts or entities without legal personality:

a) First name.

b) Last name.

c) Date of birth.

d) Type and number of identification document (in the case of Spanish nationals or residents in Spain, the document issued in Spain will always be included).

e) Country of issue of the identification document, if the National Identity Card or resident card in Spain is not used.

f) Country of residence.

g) Nationality.

h) Criteria that qualifies that person as a beneficial owner.

i) A valid e-mail address, for the purpose of sending notices of availability of possible notifications by electronic means.

• The obligation to disclose beneficial ownership does not extend to funds themselves, but does extend to their management company.

• Failure to comply with the obligation to identify and inform the Spanish Central UBO Registry,  will result in the closure of the registry in the Spanish Mercantile Registry.

• In addition, Royal-Decree 5/2023, which amended Spanish AML/CFT Law, stated that failure to comply with the obligation to identify and inform the Spanish Central UBO Registry, as well as with the other obligations set forth in the RD 609/2023, will give rise to an administrative infringement. The Ministry of Justice will determine the seriousness of each infraction, the possible sanctions, the sanctioning procedure and the competence to exercise the sanctioning power.

• All dealings with the Spanish Central UBO Registry must be carried out by electronic means.

• Finally, now that the RD 609/2023 has been approved, Madrid's bid to host the headquarters of the European AML/ CFT is strengthened.

How does Spanish Central UBO Registry affect to entities?

As long as they are in scope of Spanish AML/CFT Law, on AML/ CFT, entities will need to update the information on their UBO as set out in RD 609/2023 if it exists discrepancy with the one transmitted by the existing registries.

In addition,  since they are obliged subjects, they will have access to the information contained in the Spanish Central UBO Registry and will obtain electronic certification of the Register (or an extract of it) in order to fulfil their obligations regarding the identification of the beneficial owner. The legitimate interest of obliged subjects referred to in Article 2 of Spanish AML/CFT Law will be presumed to be accredited, and the access to the Spanish Central UBO Registry will require the payment of a fee (of amount and functioning pending approval.

They will be able to obtain information on the nature and extent of the beneficial interest held and of this beneficial ownership, in particular, whether it is due to the control of the ownership or that of the management body of the same and the percentage of participation, including, in the case of indirect ownership, information on the intervening legal entities and their participation in each of them.