Law no. 112/2020, “On the Register of Beneficial Owners” is published in the Official Gazette no. 149, dated 13.08.2020, and has entered into force on 28 August 2020, is in the phase of extending its effects, with the set-up of the Register of Beneficial Owners. Also in appliance to this law was approved Decision no. 1088, dated 24.12.2020 “For determining the manner and procedures of registration and publication of data for beneficial owners, as well as notification by the competent state authorities and by the obligated subjects”, which entered into force on 30 December 2020.
According to this law, with the exception of natural persons, legal entities and enterprises, whose sole shareholder is the central and / or local institution of the Republic of Albania, religious communities and political parties, the following entities, will be considered Reporting Entities and have the obligation to report / register the beneficial owners:
- Limited Liability Companies;
- Joint Stock Companies;
- Unlimited Partnership;
- Limited Partnerships;
- Branches and Representative Offices;
- Credit Savings Companies and their Unions;
- Mutual Cooperation Societies;
- Agricultural Cooperatives;
- Any other Legal Entity, which by Law is obliged to register with at the NBC;
- Non-Profit Organizations, Etc.
According to the law, “Beneficiary Owner” will be considered:
- The individual who owns or ultimately controls the entity, through direct or indirect ownership of 25% or more of:
- shares or voting rights;
- participation in the capital of that entity;
- through control of other means;
- benefits from transactions carried out by the legal entity on its behalf.
- Founder, legal representative or individual exercising ultimate effective control over the administration and control of non-profit organizations.
- Creator of the trust, trustee, defense counsel, if any, beneficiaries or when the persons benefiting from the legal agreement or entity have not yet been identified, the class of persons for whose main interest the legal agreement or entity is established or operates; any other individual exercising ultimate control over the trust through direct or indirect ownership or other means.
Identification of the Beneficiary Owner
Personi i autorizuar për të përfaqësuar subjektin raportues në aplikimin elektronik për regjistrimin e pronarit përfitues bashkëlidh dokumentacionin e nevojshëm shoqërues, në format elektronik dhe aktet të tilla si:
- identification documentation and name of the reporting entity
- subject extract;
- the extract of the legal entity that is owned by the registered individual and is a partner / shareholder in the legal entity;
- the statute and internal acts of the company;
- contract or any other document proving that the registered individual is the beneficial owner of the entity, according to the “direct” or “indirect” ownership.
- Direct ownership – is the ownership held by an individual of 25% or more of the capital shares / quotas or ownership interests in a reporting entity;
- Indirect ownership – is the ownership held or control exercised by an individual on one or more legal entities, who separately or jointly own 25% or more of the capital shares / quotas or ownership interests in a reporting entity.
- In case the possessing individual of 25% or more cannot be identified, the individual owner who is the beneficiary owner must be identified and registered:
- determines the decisions taken, or;
- controls in any way the election, appointment and removal of the majority of decision-making bodies and / or executive bodies of the entity.
- If even in this case the beneficiary owner cannot be identified, then the reporting entities must identify and register, as the beneficiary owner, the individual (s) who holds the position of top manager / managers of reporting entities.
- For both of the above cases, the reporting entity must also submit a written statement signed by the legal representative of the reporting entity, setting out precisely the steps taken to identify the individual as the beneficial owner.
Deadline for Registration
Existing reporting entities must identify their beneficial owners and create and maintain relevant documents for them by 31 December 2020. However, the deadline for registering the required data for the beneficial owners is within 60 calendar days from the date of the set-up of the Register of Beneficial Owner (which was expected to be March 31, 2021).
With Normative Act no. 12, dated 25.03.2021 “On some changes and additions to law no. 112/2020, “On the Register of Beneficial Owners“, published in the Official Gazette no. 49, dated 29.03.2021 the deadline has been extended until June 30 2021.
Newly registered entities should report the data related to the beneficial owners within 30 days from the date of registration. In addition to the initial records, entities are required to report any changes to this data within 30-days from the date of change.
Registration application procedure
The application for initial registration and / or for updating or changing the data for the beneficial owners is made by the person authorized to represent the reporting entity through the electronic counter.
- The authorized person is provided with the electronic signature, according to the provisions of the legislation in force for the electronic signature;
- The authorized person identifies the beneficiary owners according to the law and provides the necessary documentation;
- Electronic identification in the unique e-Albania services portal, filling in the form and submitting the documentation within the legal deadline;
- Acceptance of the application and reflection of the data in the register.
- Failure to initially register data on its beneficial owner within the deadlines is punishable by a fine of 250,000 ALL (existing companies), and 500,000 ALL (newly established companies);
- Failure to register any change in the recorded data within 30 days is punishable by a fine of 250,000 ALL;
- For the above violations is punished with a fine of 150,000 ALL and the legal representative of the registered subject, legal entity;
- For entities that commit the violations provided above, more than once, the fines will be doubled;
- The NBC and the authority responsible for maintaining the register of NGOs, for reporting entities that commit the above violations, will not provide their services until the payment of the fine and registration of relevant data for the beneficial owner.