New guidance issued by the Luxembourg Business Registers on beneficial ownership registration

Background 

Under the RBO Act, an Obliged Entity is responsible for identifying its BOs who must be natural persons. In principle, as per the definition in Article 1 (7)(a) of the Luxembourg act of November 12, 2004 on the combat against money laundering and terrorist financing (AML Act), a BO is any natural person who ultimately owns or controls the entity through direct or indirect ownership of a sufficient percentage of shares, voting rights, or an ownership interest, including through bearer shareholdings, or through control by other means. Where no such BO can be identified, the senior managing official(s) must be registered as BO(s) in the RBO. 

Although a specific definition for BOs of fiducies and trusts was provided by the AML Act, there was some debate on the market as to how to reconcile these two definitions when carrying out a declaration to the RBO, where a company was held by a fiducie or trust, in particular where the fiducie/trust was set-up abroad. 

Key clarification: look-through to the fiducie, trust, or foundation

Circular LBR 26-01 introduces an important clarification regarding the applicability of this standard beneficial ownership analysis where an Obliged Entity is held by a fiducie, trust, or foundation. Consistent with the upcoming requirements under the new Regulation (EU) 2024/1624, in particular its Article 55, the LBR specifies its expectation that in such a scenario the beneficial owners to be reported to the RBO are the BOs of the underlying fiducie, trust, or foundation, rather than those determined under the general company ownership test. 

In such cases, in accordance with Article 1(7)(b) and (c) of AML Act, the following natural persons must be registered in the RBO as BOs of the Obliged Entity: 

• The settlor(s) 

• The fiduciaire(s) or trustee(s) 

• The protector(s), if any 

• The beneficiaries or, where the individuals benefiting have yet to be determined, the category of persons in whose main interest the legal arrangement or entity is set up or operates 

• Any other natural person exercising ultimate control through direct or indirect ownership or through other means 

Required information for registration in the RBO 

As a reminder, the information to be registered in the RBO for each beneficial owner includes: 

• Surname and first name(s) 

• Nationality (or nationalities) 

• Date of birth 

• Place of birth 

• Country of residence 

• Precise private or professional address 

• National identification number (or foreign identification number for non-residents)

• The nature and extent of the beneficial interests held 

Practical implications 

Obliged Entities should consider the following steps: 

1. Review existing RBO filings. Obliged Entities held by a fiducie, trust or foundation should verify their current RBO registrations and, where necessary, (i) amend their internal analysis on who should be registered with the LBR (making sure that the revised internal analysis is duly documented and recorded) and (ii) accordingly, proceed to the necessary modifications to the data registered with the LBR to reflect the beneficial owners of the relevant fiducie, trust, or foundation. 
2. Engage with fiduciaires, trustees or foundations. Obtaining the required personal data for registration in the RBO may require coordination with the relevant fiduciaire, trust, or foundation and its advisers. 

Note that Obliged Entities have one month from the date they became aware of required changes to their RBO declaration to carry out such amending declaration to the RBO. Review and updates should thus be carried out as soon as possible.