Latest Updates on Beneficial Owners Registration: The final stage for implementation in Cyprus

The Law on ‘The Prevention and Suppression of Money Laundering from Illegal Activities of 2007 (118(I)/2007)’ adopts the corresponding European Directives in Cyprus. Among other things, the legislation requires the maintenance of a Central Register of Beneficial Owners for companies registered in the Republic of Cyprus.

The Department of Registrar of Companies and Intellectual Property (DRCIP), in line with the above, and in compliance with relevant legislation, has now commenced the implementation of the final stage of the Beneficial Ownership Register (BOR) electronic system as of November 14, 2023. The aim is that the BOR system will be fully implemented by the end of 2024.

The system and the procedure to be followed concerns all companies established or registered under the Companies Law, Chapter 113, all European Public Limited Liability Companies (SE), and all Cooperatives or their officials/partners.

The system will be implemented in three phases as outlined below:

Phase A: November 14, 2023 - December 31, 2023:

During this stage, the companies mentioned above must proceed with an "Initial Registration," meaning they need to update/re-register their Beneficial Owners (BOs), even if they have already done so in the interim stage. Phase A will last approximately 1 ½ months (November 14, 2023 - December 31, 2023), and no financial penalty can be imposed during this phase.

Phase B: January 1, 2024 - February 29, 2024:

Starting from this stage, there will be a financial penalty for companies and organisations that have not entered their initial registrations into the system during Phase A (even if they have already done so in the interim stage).

• The financial penalty will apply until the details of the beneficial owners are updated in the system.
• Once companies and organizations pay the financial penalty imposed, they can proceed with registrations, changes, or terminations without any further financial implications.
• For those companies and organizations that have already declared their BOs within the system during Phase A, no financial burden will be imposed.

Phase C: from March 1, 2024, onwards:

During Phase C, the following actions will be available through the system:

• Beneficial Ownership Register Update
• Beneficial Owners Confirmation
• Examination of entries and cross-matching
• Electronic Search in the Beneficial Ownership Register
• Request for exemption from disclosure of information
• Request for access to information relating to minors
• Calculation of financial burdens where applicable

Throughout all phases, the electronic system will allow:

• The exercise of due diligence
• Exemption from information disclosure
• Request for access to information relating to minors
• Declaration of exemption for organisations listed on a regulated market subject to disclosure requirements under EU legislation
• Declaration for exemption from disclosure, for organisations subject to equivalent international standards ensuring adequate transparency of ownership information
• Obligated Entities and Competent and Supervisory Authorities can independently conduct electronic searches in the BOR.

The content of this article is valid as at the date of its first publication. It is intended to provide a general guide to the subject matter and does not constitute legal advice. We recommend that you seek professional advice on your specific matter before acting on any information provided. For further information or advice, please contact Lefteris Eleftheriou, Trainee Lawyer at our Nicosia office, Tel +357 22447777 or email lefteris.eleftheriou@kyprianou.com