Attention all Owners of European Companies

This is an announcement to all owners of European companies, and all owners of UK companies specifically.

many business man form companies in the European Union and in UK, for various purposes, a few of which are internet trading and business activity in Europe. When there is a corporate structure involving companies which were incorporated in tax havens (Offshore), the European company is usually being incorporated as a subsidiary of the offshore company, for a clear purpose - the owner of the company wishes privacy as to its true identity; that is to say - anonymity as to his ownership.

The second simple way to keep the owner's privacy is to form a trustee for his shares in the company and as a sole director.

Nevertheless, much to the owners dismay, on May 20th 2015 there has been issued a new Directive in the European Union - the 4th Money Laundering Directive on prevention of the use in the financial system for the purposes of money laundering and terror financing (hereinafter, the "Directive"). For the purpose of full understanding, a directive is a kind of "super-law" in the European Union. it is being enacted in a legal process by a body comprised of representatives of the partying states.

This Directive presents an extreme demand, not to be seen yet in the modern commercial world - to unveil the true holder of controlling interest, the real flesh-and-blood person, in any company, including holder of controlling interest behind a trust, a parent company or a corporate construction.

According to this new Directive, any European company must report the identity of the holder of control interest to a special database which shall be formed especially for that purpose, and this database shall be used by authorities of anti-money laundering. Moreover, any interested third party could pay a fee and receive information from that database.

The Directive also defines money laundering as an action in property which somehow related to "criminal activity", whereas "criminal activity" is defined as any offence which holds prison of more than 12 months. 

The sanctions for non-conforming with the Directive can be criminal, including fine and incarceration, but there also can be administrative sanctions, such as turning the shares of the company dormant.

The Directive applies to all countries of the European Union, which means that every party of the Union must import the rules set in this Directive.

It should be noted that these are minimum requirements set as a standard, and party members can be stern and "raise the bar" even further.

The deadline to implement the new Directive is June 26th, 2017 - for all EU members.

And UK Companies?

UK is the first country to decide to amend its legislation following the Directive, and the amendment to the Companies Act, entered into effect lately, indeed "raised the bar".

UK has decided to make the abovementioned database available to anyone who wishes to review it. That is to say, the Directive only required for a database to be established, whereas UK "raised the bar" and made this database available to any person, even if he has no interest in the company.

As of April 1st 2016, every company is bound to create a database of flesh-and-blood holders of the control interest, and as of June 30 2016, they have been bound to submit it to the Company House (Company registrar in UK).

The meaning of this act is that UK has preceded the exposure date, from June 26th 2017, to June 30th 2016.

IT SHOULD BE REMINDED THAT THIS IS A CHANGE THAT IS ABOUT TO TAKE PLACE FOR CERTAIN IN ALL THE EU COUNTRIES, AND UK IS ONLY THE FIRST COUNTRY TO IMPLEMENT THE DIRECTIVE.