New Amendments to the Anti-Money Laundering Act on Declaring Beneficial Owners of Foundations and Associations

By the amendments to the Measures Against Money Laundering Act (ЗМИП), promulgated in Official Journal No. 42 of 28 May 2019, important changes were made which broaden the range of persons obliged to submit a Declaration under Article 63(4) of the ЗМИП regarding their beneficial owners.

The new paragraph 6 of Article 63 of the ЗМИП broadens the scope of non-profit legal entities which will not be obliged to submit a declaration of their beneficial owners. The law expressly provides that the beneficial owners of foundations and associations must be declared for entry if they are not already entered on another basis in the files or records of the non-profit legal entities in the relevant register as natural persons. If the beneficial owners of foundations and associations are natural persons other than those entered in the relevant register and who fall within the scope of § 2 of the supplementary provisions of the ЗМИП, the data concerning them must be declared for entry.

Associations and Community Cultural Centres (Chitalishte)

In the case of associations, if natural persons can be identified who fall within the hypothesis of § 2(1)(1) of the supplementary provisions of the ЗМИП, those persons are deemed to be beneficial owners and a declaration under Article 63(4) of the ЗМИП must be submitted. If, however, such natural persons cannot be identified, the representing persons who perform functions similar to those of a senior managing official of the association are deemed to be the beneficial owners. Since these persons are already entered in the files or records of the association, a declaration under Article 63(4) of the ЗМИП need not be submitted. The same regime applies to community cultural centres (chitalishte).

Foundations

In the case of foundations, the beneficial owners must be the natural persons holding positions equivalent or similar to those specified in § 2(1)(2) of the supplementary provisions of the ЗМИП. These may be the founder or third parties who have been granted rights giving rise to the possibility of control over the decisions of the foundation. If such natural persons cannot be identified, the representing persons who perform functions similar to those of a senior managing official of the foundation are deemed to be the beneficial owners. Since these persons are already entered in the files or records of the foundation, a declaration under Article 63(4) of the ЗМИП need not be submitted.

Deadlines for Submitting Declarations

We remind you that, for non-profit legal entities that were re-registered with the Registry Agency by 31 January 2019, the deadline for submitting a declaration under Article 63(4) of the ЗМИП is 31 May 2019. For those re-registering after 31 January 2019, the deadline for submitting a declaration is 4 months after re-registration.

Should you require assistance with the preparation and submission of the declaration under Article 63(4) of the ЗМИП to the Commercial Register or the Register of Non-Profit Legal Entities, or with the preparation of risk assessments, please contact us on tel.: 0887550706 or by e-mail: [email protected]