The deadline for filing the declaration on beneficial owners of Polish commercial companies to the Central Register of Beneficial Owners (the “CRBR”) has been extended to 13 July 2020. In this article we briefly discuss the issues concerning the CRBR registration and filing, together with the meaning of the “beneficial owner” and applicable sanctions and deadlines.
Scope of obligation
The filing obligation applies to a majority of commercial companies – registered partnerships (spółka jawna), limited partnerships (spółka komandytowa), limited joint-stock partnerships (spółka komandytowo-akcyjna), limited liability companies (spółka z o.o.) and joint stock companies (spółka akcyjna), with the exception of publicly traded companies. The obligation does not apply to: civil partnerships (spółka cywilna) and professional partnerships (spółka partnerska).
The above-mentioned filing obligation exists irrespective of any other factors concerning the company, such as annual turnover, number of employees and irrespective of any other obligations such company may have under the Act of 1 March 2018 on counteracting money laundering and terrorist financing (the “Polish AML Act”) or any other laws. Companies in liquidation/ bankruptcy and/ or currently not trading are also required to report to CRBR.
Filing procedure
The declaration may be filed by authorised signatories of the company only, using a trusted ePUAP profile or qualified electronic signature. The declaration cannot be filed in a paper form and cannot be filed by a proxy (such as attorney, advocate, etc.), which, in our view, is an unnecessary and restrictive requirement (only the commercial proxy (prokurent) is authorised to file the declaration with CRBR). The CRBR register is available at https://crbr.podatki.gov.pl. The CRBR is a public register and can be accessed online and free of charge.
Beneficial owner
Beneficial owners are natural persons possessing more than 25% of the total number of shares of an entity or the total number of votes in the decision-making body of the company (directly or indirectly through other companies) or being a dominant entity
If it is not possible to identify the beneficial owner in accordance with the above principles or if the identity of such persons is in doubt, a natural person in a senior management position can be registered. However, the inability to determine the beneficiary while using the first method has to be documented.
The real beneficiary cannot be the so-called nominee shareholder. In the case of trusts, the beneficiaries are: settlor, trustee, supervisor, beneficiary or other person exercising control over the trust.
Establishing the beneficial owner can be often a long and complex process, especially in the case of companies with a complicated or fast-changing organisational structure, where the 25% threshold, with a large number of managing entities, may be “blurred”.
Data registered in CRBR
CRBR register contains the following data:
- identification (registration) data of the company, and
- full name, citizenship, country of residence, Polish personal identification number PESEL or date of birth (for beneficial owners not having the PESEL number), the amount and type of share interest or the rights of the beneficial owner.
Sanctions and penalties
Filing a declaration to CRBR containing false or inaccurate data may result in criminal liability of the company’s representative(s) obliged to file such declaration (Article 233 of the Polish Criminal Code). Also, pursuant to Article 153 of the Polish AML Act, companies which have not fulfilled the obligation to submit the required information to the Register within the statutory deadlines are subject to an administrative fine of up to 1 000 000 000 PLN. The representatives who are obliged to submit and/ or update information about beneficial owners, bear liability for the damage caused by reporting incorrect and/or false information (Article 68 of the Polish AML Act) and/ or by not updating it in a timely manner. These sanctions are excessive, especially in the context of the objective difficulty of identifying the beneficial owner in more complicated or fast-changing ownership structures of the holding companies.
Deadlines
New companies, registered in the Polish National Court Register after 13 October 2019, have 7 days to file the declaration (from the day on which the company is entered in the National Court Register). All other companies, registered prior to that date, have to make an entry by 13 July 2020. Any changes to the data registered in CRBR have to be reported to CRBR within 7 days from the date of the change occurring.
written by: legal trainee Edyta Chmura-Szczecińska