Important news

Mandatory UBO registration in Lithuania

Dovilė Boguševičienė​
insight featured image
Specialists from the Legal Advisory of Grant Thornton Baltic recall the obligation for legal entities to provide data on Ultimate Beneficial Owners from 2022 onwards. May 1
Contents

Section 1 of Article 25 of the Law on the Prevention of Money Laundering and Terrorist Financing of the Republic of Lithuania:

  • All legal entities established in Lithuania (except those whose only participant is the state or municipality) must receive, update and store accurate information about their Ultimate Beneficial owners (UBO):
    • Name, Surname;
    • Personal code, date of birth (if a personal identification number is not provided under
      the legislation of a foreign state);
    • State which issued ID document, place of residence;
    • Owned property rights and scope (percentage of shares, percentage of voting
      rights`) or other control rights (Chairman of the Board, Member of the Board, Chief Executive Officer, Senior Chief Executive Officer, other positions related to percentage of transferred voting rights);
  • This information must be provided to the Legal entities register (UBO subsystem JANGIS) no later than 10 days from the data change.
  • UBOs must disclose their identity to the legal entity‘s representative fulfilling the obligation to provide data.

 

What is an UBO?

  • a natural person who is the owner of a legal person and holds more than 25% of shares, stocks, contributions and / or votes, benefits from it:
    • Direct owner - a natural person who owns 25% and one share or more than 25% of the client's equity.
    • Indirect owner - a natural person who controls a company or several companies that own 25% and one share or more than 25% of the client's ownership share.
  • a natural person who controls the legal person otherwise, such as the right to appoint or remove the head of the legal person, to take strategic decisions;
  • a natural person who controls a legal person otherwise, for example, is its manager, chairman or member of the board or other collegial body.

 

Why is the provision of information about beneficiaries mandatory?

  • The obligation is provided for in the Law on the Prevention of Money Laundering and Terrorist Financing;
  • Prerequisite for access to services in financial institutions (e.g. account opening, monetary transactions, transactions, etc;
  • Required for financial institutions through periodic data updates and regular monitoring of business relationships and financial transactions;
  • Other entities, such as auditors, bailiffs, notaries and others, are obliged to use the data of the UBO subsystem (JANGIS) for the provision of services;
  • Greater transparency and public confidence;
  • Assistance in the fight against money laundering and terrorist financing etc;

 

Legal liability

Non-compliance with the above requirements and non-disclosure of information entails administrative liability:

  • For legal entities 500 – 2400 Eur;
  • For managers of legal entities 2100 – 6000 Eur;

Article 216 of the Criminal Code (legalization of criminal assets) provides for a fine or imprisonment of up to 7 years.

 

How to provide information on UBOs?

  • Only in electronic form - connect to the customer self service system of the Center of Registers (with electronic signature, via e banking);
  • Details of the beneficiaries are provided by the head of the legal entity or an authorized person;
  • In order to authorize a person to provide data, the authorization must be granted by logging in through the customer self service system of the Center of Registers or a paper authorization form prepared by the Center of Registers.

Intended stages

I stage

Immediately: legal entities, whose beneficiaries are all natural persons (excluding investment funds and investment companies)

II stage

Starting from May 1st 2022: all legal entities (except investment funds and investment companies) whose beneficiaries are natural and legal persons

III stage

Starting from August 1st 2022: all legal entities whose beneficiaries are natural and legal persons

Grant Thornton Baltic newsletter

Subscribe to the GTB newsletter

Subscribe to audit, accounting, tax, legal and business advisory news. be the first to receive Grant Thornton Baltic news, advices of experts, professional business insights and information about future events.