Anti-Money Laundering Compliance | The EU Anti-Money Laundering (AML) package

I. Extension of the information on beneficial owners that must be disclosed

1. Current legal situation in Germany

Under the current German legislation, only name(s) and surname(s), date of birth, place of residence with country of residence (= main place of residence), nature and extent of the beneficial interest and all nationalities must be notified to the transparency register (sec. 20 para. 1, 21 para. 1, para. 2, 19 para. 1 German Anti-Money Laundering Act (“AML-Act”).

2. Future EU-wide legal situation

The EU-AMLR significantly extends the personal data of beneficial owners to be notified to the respective national transparency register. In future, also the beneficial owner’s place of birth, residential address, number of identity document (passport or national identity document) and, where it exists, unique personal identification number (e.g. personal tax ID number) must be notified to the respective member state transparency registers (Art. 62 para. 1 subpara. 1, subpara. 2 lit. a), Art. 63 para. 2 subpara. 1 sent. 1, sent. 2, para. 4 subpara. 1 lit. b), Art. 64 para. 2 subpara. 1 EU-AMLR).

II. Extension of documentation obligations

1. Current legal situation in Germany

Entities subject to transparency obligations or the administrators or trustees of certain legal arrangements must retain the information on the beneficial owners referred to in sec. 19 para. 1 AML-Act (sec. 20 para. 1 sent. 1 case 2, 21 para. 1 sent. 1 case 2, para. 2 AML-Act). A further documentation obligation is expressly foreseen only in sec. 20 para. 3a sent. 4 AML-Act. This regulation stipulates that the entity subject to transparency obligations must document requests for information from its shareholders regarding its beneficial owners and the information obtained accordingly.

An express legal provision, as to whether and to what extent additional documents underlying the identification of the beneficial owner and the information to be notified (sec. 19 para. 1 AML-Act), must be archived in the company files, does not exist. Taking into account the AML relevant provisions on administrative offences (by argumentum a contrario, sec. 56 para. 1 no. 55 lit. b), no. 61 lit. b) AML-Act), such an obligation does also not arise indirectly from supervisory information rights of the competent authorities (e.g. sec. 18 para. 3, 23a para. 3 sent. 2 AML-Act).

2. Future EU-wide legal situation

The EU-AMLR establishes a comprehensive documentation obligation. This applies, among other things, to (i) the holding of beneficial ownership information, (ii) the regular - at least annual - verification of whether this information is up-to-date and (iii) the information obtained from the beneficial owners or the shareholders to identify the beneficial owner(s). The documentation obligation results from the obligation to provide the competent authorities with all data and information obtained in this context immediately upon request (cf. Art. 63 para. 5 in conjunction with para. 1 subpara. 1, para. 2 subpara. 1 sent. 3, 4, subpara. 2 respectively Art. 64 para. 5 in conjunction with para. 1 subpara. 1, para. 2 subpara. 2 EU-AMLR).

In the case of notification of so-called “fictitious beneficial owners”, the aforementioned documentation obligation is subject to increased requirements, as separate records must be kept of the actions taken in order to identify beneficial owners (Art. 63 para. 3 and Art. 64 para. 6 EU-AMLR).

III. New requirements for evidence and additional statements to be submitted

1. Current legal situation in Germany

Under the current German legal situation, only the information on the beneficial owners as referred to in sec. 19 para. 1 AML-Act must be notified to the transparency register (sec. 20 para. 1, sec. 21 para. 1, para. 2 AML-Act; see above cipher I.1.). When notifying fictitious beneficial owners, an additional assurance must be provided, that (i) no natural person fulfils the requirements of an actual beneficial owner or (ii) it was not possible to identify an actual beneficial owner after conducting a comprehensive review (sec. 19 para. 3 sent. 2 AML-Act).

Any further statements respectively the AML compliance documentation underlying the respective notification (e.g., structure charts, copies of identification documents, or similar) must not be provided for respectively submitted to the registry keeping office. Exceptions to the above principle only apply in cases where already the (basic) information provided is unclear or incomplete (sec. 18 para. 3 AML-Act).

A detailed explanation of the shareholding and control structures underlying the respective notifications as well as the submission of further information and evidence is currently only required in the context of official procedures (e.g. within so-called “notification of inconsistency” proceedings, cf. sec. 23a para. 3 sent. 2 AML-Act).

2. Future EU-wide legal situation

With the new provisions of the EU-AMLR, the obligation to submit proof respectively provide additional statements to the register-keeping offices will be significantly extended. These obligations exist in addition to the requirement to report information on the beneficial owners itself, whereby the scope of the future declaration and evidence obligations will depend on the individual case:

• General explanation requirements in case of multi-level shareholdings

If the ownership and control structure of an entity subject to transparency requirements contains more than one legal entity (in the broader sense of EU law, including partnerships) or a legal arrangement, a detailed description of the ownership and control structure must be provided (Art. 62 para. 1 subpara. 2 lit. d) in conjunction with Art. 63 para. 2 subpara. 1 sent. 1, sent. 2, Art. 64 para. 2 subpara. 1, Art. 67 para. 1 EU-AMLR).

• Supplementary explanations on fiduciary relationships (nominee arrangements)

If a company subject to transparency requirements is a legal person (in the broader sense of EU law, including partnerships) and its shares are held in trust, it must disclose this fact and submit to the respective member state transparency register the information received from the trustee (nominee shareholder) on the status and identity of the respective trustor (nominator) and its beneficial owner(s) (Art. 66 para. 1 sent. 1, sent. 2 in conjunction with Art. 53 para. 4 subpara. 1 lit. c) EU-AMLR).

• Separate “negative statement” in case of notification of fictitious beneficial owners

If “senior managing officials” are notified as fictitious beneficial owners (Art. 63 para. 3, para. 4 subpara. 1 lit. b) EU-AMLR; see Part 3 of our series of articles), a separate justification must be provided as to why it was not possible to determine any (actual) beneficial owner after exhausting all possible means of identification (so-called “negative statement”; Art. 63 para. 3, para. 4 subpara. 1 lit. a), Art. 64 para. 6, para. 7 lit. a) EU-AMLR).

• Additional declaration obligations for companies based outside the EU

If the beneficial owners of companies based outside the EU are to be notified (see Part 2 of our series of articles), an additional statement must be provided setting out in relation to which activities the information is being submitted. This statement (including all relevant documents in this respect) must be submitted prior to start of the business activity triggering the respective notification obligation (e.g. acquisition of real estate, establishment of a business relationship with an obliged entity) (Art. 67 para. 3, para. 7 subpara. 1 EU-AMLR).

IV. Recommendation & Outlook

The new regulations concerning the extension of the information on beneficial owners that must be disclosed as well as the various additional documentation, declaration and evidence obligations will require companies, particularly if embedded in multi-level respectively cross-border structures, to adjust and step-up their AML compliance management accordingly.

Affected companies are particularly recommended to initiate measures at an early stage, based on the "status quo" of the known shareholding and control structures, to ensure the seamless and reliable documentation of any relevant changes (also) at the level of the respective parent companies.

For more information, we refer you to our recommendations and outlook from Part 1 of our series of articles.

Authors: Jens Hoffmann | Anna-Lena Kringel | Natalia Vost

Published: April 2025