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Public access to Central Register of Beneficial Ownership suspended

  • Ireland
  • Corporate
  • Corporate secretarial services

05-12-2022

A recent landmark judgment from the European Court of Justice (“CJEU”) has raised uncertainty as to the validity of the general public’s right to access information on beneficial owners of Irish companies and as a consequence of this judgment, the search facility on the Central Register of Beneficial Ownership’s (“RBO”) website has been temporarily suspended.

In November 2019, it became a requirement for companies registered in Ireland to disclose details of their beneficial ownership on a public register pursuant to the European Union (Anti Money Laundering: Beneficial Ownership of Corporate Entities) Regulations 2019 (the “2019 Regulations”) which transposed certain parts of the Fifth Anti-Money Laundering Directive (“AMLD5”).

The 2019 Regulations provide for two tiers of access to certain parties, with Tier 1 access reserved for state competent authorities such as the Garda Siochána and the Revenue Commissioners and Tier 2 for the general public and certain designated persons for the purposes of carrying out due diligence. Whilst Tier 2 is more restrictive, it still provides the general public, upon payment of a nominal fee, with unbridled access to limited information regarding a beneficial owner which is the crux of this recent CJEU decision.

This judgment arose as a result of a Luxembourgish company and its beneficial owners being denied the ability to restrict the general public’s access to their personal data. That ruling was then referred to the CJEU. In summary, in the CJEU’s judgment, it was held that the provision within AMLD5 which ensures information on beneficial owners is accessible in all cases to any member of the general public is invalid and constitutes a serious interference with the fundamental rights to respect for private life and to the protection of personal data, which are enshrined within the Charter of Fundamental Rights of the European Union (the “Charter”). Essentially AMLD5 provided that any member of the public could, without giving reason, access certain (albeit restricted) information on beneficial owners. Whilst the CJEU found that there are cogent reasons for the collection of beneficial ownership information, primarily in combatting money laundering and terrorist financing, this needed to be balanced with an individual’s right to privacy and the protection of one’s personal data and thus was found to be disproportionate.

At this stage, and incidental to this judgment, it is unknown as to how this decision may affect the information contained within a company’s statutory registers such as the register of shareholders and the information which is disclosed on certain filings with the Companies Registration Office. In the UK, the Companies Act 2006 provides for a “proper purpose” test in order to access certain information within a company’s registers including personal data on shareholders, beneficial owners and directors. There is no similar provision in Ireland and the majority of an Irish company’s information is disclosed publicly. As to whether a similar provision will be introduced in Ireland is not known, however, the findings in this judgment would certainly indicate so.

Whilst the RBO’s search function has been suspended, it remains necessary for companies to continue to disclose and/or update their beneficial ownership information.

If any of the preceding affects you, our highly skilled company secretarial team can provide assistance and advice on this and on all aspects of company law and corporate governance and we will also continue to keep you abreast of changes and updates in company law that may affect your company.

For further information, please contact a member of our company secretarial team.

Aoibheann O'Grady, AoibheannOGrady@eversheds-sutherland.ie