What is the UBO Register?
The UBO register (Ultimate Beneficial Owners) is a legal obligation imposed on companies with the aim of combating money laundering and terrorist financing.
Indeed, this register allows the identification of natural persons who own or control, either directly or indirectly, a legal entity, including limited liability companies.
Why is the UBO Register mandatory?
The registration of UBOs ensures financial transparency. More specifically, it enables authorities to detect potential illicit activities, such as shell companies used for tax evasion or money laundering. Moreover, this register offers multiple benefits to businesses, including:
- A significant reduction in legal and regulatory risks.
- Greater credibility with business partners and financial institutions.
Therefore, it is essential that all companies comply with this obligation. Otherwise, they could face substantial financial penalties, as well as banking and commercial restrictions.
Who is required to register in the UBO Register?
All companies and legal entities established within the European Union must declare their beneficial owners. More concretely, the following structures are directly affected:
- Commercial companies (LLC, PLC, etc.): all entities engaged in economic activity must identify their beneficial owners.
- Associations and foundations that carry out significant financial activities.
- Legal structures with multiple levels of shareholders, which require transparency in their shareholding structure.
What are the reporting obligations?
Companies must provide the following information to the UBO Register:
- Identity of the beneficial owner: first name, last name, date of birth, and nationality of the natural persons exercising significant control over the entity.
- Nature and extent of the control exercised: details on how the beneficial owner holds shares or influences the management of the company.
- Ownership of shares or voting rights: any person holding more than 25% of a company’s shares must be declared.
- Strict deadlines for updating information: any modification in the company’s structure must be reported within 30 days.
How to declare the Ultimate Beneficial Owner (UBO)?
To ensure rigorous compliance, it is recommended that companies follow these steps:
- Identify the UBOs by analyzing the company’s structure and determining the natural persons with effective control.
- Report the information accurately and in detail, ensuring that all required data is included.
- Update the data as soon as a change occurs in the ownership or control structure of the company.
- Submit supporting documentation, such as the company’s statutes and the identity documents of the declared beneficiaries.
- Strictly comply with legal deadlines to avoid administrative penalties and ensure total transparency.
Since this process can be complex, having the advice of a specialized lawyer, such as those at Arthur & Marin law firm, can be essential to avoid errors.
Penalties for non-compliance
Failure to comply with the UBO registration obligation can result in severe consequences for businesses. Among the most common penalties are:
- Administrative fines that can amount to several thousand euros, or even higher amounts in cases of prolonged non-compliance.
- Criminal penalties for responsible executives, especially if the non-compliance is due to deliberate omission.
- Banking restrictions or difficulties in obtaining financing, as many financial institutions require transparency regarding ownership structure before granting credit or opening a bank account.
- Blocking of commercial operations, since some companies may refuse to collaborate with entities that do not comply with the UBO register.
- Loss of trust from partners and clients, which could hinder the growth and development of the business.
Recent cases of penalties
In 2025, several European companies were sanctioned for failing to comply with the UBO register. For example, a financial services company based in France was fined 50.000 EUR for failing to properly declare its beneficial owners.
Likewise, a German SME had its bank account suspended due to a failure to update its UBO information, leading to payment delays and significant commercial losses.
UBO Register: financial transparency
The UBO register is a fundamental pillar for ensuring financial transparency and combating economic crime. Compliance is an unavoidable obligation for all businesses. To avoid penalties and ensure optimal compliance, it is highly advisable to seek the support of a lawyer specialized in corporate law. If you are considering starting a business, check out our guide and register your company today.
Do you need legal advice? Contact us for guidance in the UBO registration compliance process via email at info@arthurmarin.com or call +32 465 345 345. Book your appointment today!
