Spain: New identification statement form for ultimate beneficial owners to file with annual accounts in the Commercial Registry

Order JUS/319/2018, of 21 March, approving the new forms for filing at the Commercial Registry the annual accounts of the parties required to publish them, which came into force on 28 March 2018, requires identifying the ultimate beneficial owner and the control structure.

The main change that the Order JUS/319/2018, of 21 March, (the "Order"), introduces is the new form of "identification of the ultimate beneficial owner of the company" (the "TR form") that companies must submit at the time of filing the annual accounts with the Commercial Registry.

This obligation is based on the Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015, on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing – which should have been transposed before 26 June 2017 – and determines that "Member States shall ensure that the information (…) regarding the beneficial ownership is held in a central register in each Member State, for example a commercial register (…) or a public register" (article 30.3 from the referenced text).

The TR form shall only be summited with the individual annual accounts (regular, abbreviated, or PYME model; in paper format as well as electronically) – not consolidated – and shall be signed by the company's directors when preparing the annual accounts.

All legal entities with registered address in Spain that file accounts in the Commercial Registry are subject to identifying the ultimate beneficial owner, except (i) the companies listed on a regulated market of the European Union or equivalent third countries (article 4.2 (b) of the Law 10/2010, of 28 April, on the prevention of money laundering and terrorist financing (the "Law 10/2010")) or (ii) their majority owned subsidiaries as long as they are subject to providing information that ensures the adequate transparency of its beneficial owner (article 9.4 Regulation which develops Law 10/2010).

In accordance with article 4.2 of Law 10/2010, the ultimate beneficial owner is considered to be "the natural person(s) who ultimately owns or controls, directly or indirectly, a percentage of more than 25 percent of the share capital or voting rights of a legal entity, or who by other means exercises control, directly or indirectly, over the management of a legal entity". If it cannot be considered that a natural person controls a legal entity it is assumed that said control is exercised by the director(s) or, when applicable, by the natural person representing the director which is a legal entity (the "Assimilated Owners").

In this sense, it is worth noting that:

• In case of an indirect ultimate beneficial owner, it is necessary to include the information relative to the control structure in the TR form, identifying the "dominant legal entity that holds an immediate shareholding in the obliged company to file the annual accounts until overtaking the last ultimate beneficial owner" and each legal entity which forms part of the control structure.
• When there are Assimilated Owners, the Order foresees the possibility of referring to the books of the Commercial Registry. Nevertheless, the TR form includes a specific section in which to incorporate the directors' information.

Finally, note that the obligation to submit the TR form will apply when filing the individual annual accounts corresponding to the fiscal year ended on 31 December 2017, except for those companies that have approved and filed them before the entry into force of the Order. In successive financial years, it shall only be completed if there have been changes in the ultimate beneficial ownership.