Who is a beneficial owner?

The Act on Money Laundering defines beneficial owner as a person who either owns a company or otherwise exercises control over the company.

Those who meet any of the following requirements are considered as beneficial owners:

  • The person owns more than 25% of the company shares directly or indirectly through another company.
  • The person holds more than 25% of the voting rights in the company directly or indirectly through another company. Shares that belong to the company or its subsidiary organisation are not taken into account when counting the number of votes.
  • The person exercises actual control over the company on other grounds. Other grounds may refer to a partnership agreement, for example.

In a company, there can be none, one, or several beneficial owners.

Most companies only have like-kind shares. In these cases, the allocation of both shares and number of votes is most often the same. However, if the company has shares of different kinds, the persons who hold more than 25% of the number of votes are beneficial owners.

The share of ownership is calculated based on the shares and votes not held by the company itself.

A beneficial owner is always a person. The estate of a deceased person, a company, an association, or a public entity cannot be filed as a beneficial owner. There are usually no actual beneficial owners in a company owned by a public entity (e.g. the state or a municipality). In this case, the board of directors, the managing director or any other person in a corresponding position are considered as beneficial owners.

Companies are each responsible for identifying their beneficial owners. The PRH will not determine the beneficial owners of any company or organisation.

See our examples of benefial owners.

What to do if there are no beneficial owners

Please note that the company must file a notification of beneficial owners even if the company has no beneficial owners meeting these requirements or the company does not know them.

In this case, the board or the general partners of the company, or the managing director or any other person in a corresponding position are considered as actual beneficial owners according to the Act on Money Laundering.

We will make the following entry in the register details of the company: “The organisation has no actual beneficial owners, or no beneficial owners have been able to be identified. In this case, the board or the general partners of the organisation, or the managing director or any other person in a corresponding position are considered as actual beneficial owners."

Who are beneficial owners when a company is owned by another company?

If company A owns shares or exercises voting right in company B, use the following questions to find out the beneficial owners of company B:

  1. Does company A own more than 25% of the shares in company B, or does it hold more than 25% of the voting rights?
  2. If the share of ownership or share of votes held by company A exceeds 25%, is there a person who exercises independent power of decision in company A?

The owner company A can be considered as being under the control of a person if the person can make decisions independently in the company. This is the case, for example, if the person holds more than 50% of the company shares and votes, or if the person is a partner in a general partnership, or a general partner in a limited partnership.

The person exercising independent power of decision in company A is a beneficial owner in company B, because the person is considered to hold the entire share of votes of company A in company B.

The person exercising independent power of decision in company A can also own shares in company B directly and through a third company. In this case, all the separate shares of ownership and/or voting rights are added up.

See our examples of beneficial owners.

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Latest update 06.10.2020