Update – Beneficial ownership register act
In order to fully implement the EU Fourth Anti-Money Laundering Directive, Norway is soon to establish the necessary legal basis for a Beneficial Ownership Register. The EU Fourth Anti-Money Laundering Directive article 30 provides that companies in Member States should obtain and hold information relating to their “Beneficial Owners” and that this information should be reported to a central register.
The Government presented on 22 June 2018 a proposal for a new Beneficial Ownership Register Act to the Parliament. Our previous publication contains an overview of the proposal.
On 31 January 2019 the Parliament's Standing Committee on Finance and Economic Affairs presented its proposal to the Parliament. The proposal is based on the Government's previous proposal and does not entail many changes.
All legal entities operating in or registered in Norway, will, according to the proposal, have an obligation to collect and report information on their beneficial owners to the Norwegian register. The Ministry of Finance may adopt regulations providing details on which legal entities that should have a reporting obligation to the register.
Pursuant to the proposal the criteria set out in the Norwegian Anti Money Laundering Act (the "AML Act") Section 14 shall apply equally for entities' duty to identify their beneficial owners. However, in respect of listed companies the proposal is ambiguous. The AML Act Section 14 does not require identification of beneficial owners when the customer is a company whose ownership interests are listed on a regulated market in an EEA state or subject to disclosure requirements equivalent to those applicable to listing in a regulated market in an EEA state. The same applies when the customer is a majority-owned subsidiary of such company. It is not clear whether this exception for listed companies will also apply to registration in the Beneficial Ownership Register. The Government had been asked by the Parliament to clarify who should be regarded as beneficial owners since Section 14 of the AML Act is not sufficiently clear in this respect. Further guidance from the Government is therefore required.
The register will according to the proposal be publicly accessible, and reporting entities may use the information in the register as part of the customer due diligence procedure.
Failure to report beneficial owners to the register will, according to the proposal, be punishable by fines or imprisonment.
The Committee Proposal will now be debated in Parliament, and the first reading is scheduled at 7 February 2019. The Proposal will likely be adopted by mid February, but it is still uncertain when the Act will enter into force.
The proposal in Norwegian can be found here: Innst. 143 L (2018-2019)
An English translation of the Norwegian AML Act can be found here.