The most frequent questions to the Austrian UBO Act

01. General Questions

Definitely yes. One key advantage of the register of beneficial owners is that it impedes terrorism financing and money laundering. In particular, the impediment of money laundering ensures fair competition throughout the market, which will undoubtedly benefit any honest company. Although the introduction of the register of ultimate beneficial owners further increases the bureaucratic burden on legal entities required to register, there is another very specific advantage connected with the register of ultimate beneficial owners: Professional service providers (such as lawyers, notaries, etc.) can rely on a register excerpt to determine ultimate beneficial owners  in the course of their due diligence, as far as a so called complete extended excerpt is available.

The Austrian UBO Act applies generally only to companies and other legal entities (such as foundations and trusts), collectively such legal persons are referred to as "legal entities". Private individuals and sole entrepreneurs are completely exempted from the provisions of the Austrian UBO Act. Whether your business falls within the scope of the Austrian UBO Act or whether an exemption from the obligation to registrater is applicable , you can find out on our website under the item "Online Selfcheck". This self-check is completed within a few minutes and afterwards you can commission us, if necessary, to perform all the necessary steps for your entry in the register of ultimate beneficial owners.

If you have a specific question about the Austrian UBO Act, you are welcome to contact us via info@wiereg.at. If you are unable or unwilling to deal with the new law, we are happy to take care of all obligations associated with the Austrian UBO Act.

Professional service providers (including lawyers, notaries, accountants and, tax accountants), may register their clients in the register of ultimate beneficial owners. If you would like to delegate your company's obligation to register in the UBO register, you are welcome to contact us at info@wiereg.at.

No. In addition to the obligation to register initially, there is also the obligations to update the register entry with all relevant changes within four weeks after becoming aware that can not be automatically transferred from other registers. In addition there is also the obligation to verify the register entry at least once per year. However, the annual review may be omitted under certain circumstances for certain entities. In addition, documentation must be prepared and all relevant documents must be retained for five years after retirement of an ultimate beneficial owner.

First registration has to be completed prior to August, 15th 2018 as far as the enitiy is obliged to register. To evaluate whether your entity is obliged to register you can use our free online-tool.

A supreme legal entity is understood as that entity in the ownership chain that is directly controlled by indirect beneficial owners, as well as those entities that establish indirect beneficial ownership. Accordingly, a supreme legal entity always exists only if an indirect beneficial owner is present.

The term “control” in context of the Austrian UBO Act describes the ability of a natural person to influence the senior management board of an entity in his/her favour.

According to the Austrian UBO Act there are several possibilities to exercise control, including but not limited to ownership of a majority of shares or voting shares or the possessing the right to nominate members of senior management. Also holding certain functions in trusts is defined as exercising control according to the Austrian UBO Act.

The term "beneficial owner" describes the natural person to whom a company ("legal entity") can ultimately be economically allocated. The requirement for "ultimate beneficial ownership" is therefore either factual ownership or factual control. Only natural persons come into consideration as ultimate beneficial owners within the meaning of the Austrian UBO Act.

The difference between direct and indirect ultimate beneficial ownership is the immediacy of ownership. While a direct beneficial owner directly participates, an indirect beneficial owner holds his shares only indirectly (for example, through the ownership of a second company which itself is the direct owner of the first company).

02. Private Companies and Corporations

For stock companies the Austrian UBO Act considers shareholders with a stake of more than 25 % as ultimate beneficial owners.  For these persons it is of no importance whether they hold a function within the stock company or not. Only when no natural person can be determined as ultimate beneficial owner (e.g. because nobody owns a stake above 25 % of the company) the members of the senior management are to be registered as ultimate beneficial owners in the course of a subsidiary registration. For stock companies the members of the management board are considered as senior management.

For limited partnerships only the data of those persons who are fully liable are automatically transferred from the company register. A limited partner of a limited partnership is only considered as ultimate beneficial owner if he owns a stake or voting share above 25 % or exercises control over the management board – in these cases the limited partner has to be registered proactively.

If all members of a general partnership are natural persons without any legal entity all necessary data can be transferred from the company register. Therefore in most cases an exemption from the obligation for registration is present, which lapses if a different natural person factually exercises control over the management board. A documented annual verification of the register entry in the register of ultimate beneficial owners is nevertheless necessary.

No. Private corporations are outside the scope the Austrian UBO Act. Therefore no registration is necessary under any circumstances and therefore the members of private corporations are not registered in the Austrian ultimate beneficial owner register.

No. Dormant partnerships are outside the scope of the Austrian UBO Act. Accordingly the dormant partnership is not obliged to register and also the members of the dormant partnership are not displayed in register auf ultimate beneficial owners.

If all partners are natural persons and no partner is a legal entity then all necessary data for the register of ultimate beneficial owners is available and no registration has to be performed proactively. This exemption from registration also requires that no deviating internal contracts with relevance to the ultimate beneficial ownership exist, as well as no person exercises control over the management board. However, the exemption only concerns the initial registration, the annual verification of the register entry is still to be performed.

No – in the current version the Austrian UBO law defines a stake above 25 % as the threshold for being considered as ultimate beneficial owner. Holding a stake of 25 % is therefore not sufficient to be considered as ultimate beneficial owner according to Austrian law.

Currently the Austrian UBO Act defines a share proportion above 25 % of overall shares as a prerequisite to be considered as ultimate beneficial owner.  Accordingly, those shareholders who hold a stake of the company which exceeds 25 % have to be registered in the Austrian register of ultimate beneficial owner.

03. The registration of ultimate beneficial owners

Trusteeships have to be disclosed if they are relevant for ultimate beneficial ownership. Accordingly, trusteeships which do not influence ultimate beneficial ownership have no need for disclosure according to the Austrian UBO Act.

Yes, only in cases the type of entity is outside the scope of the Austrian UBO Act or an exemption from the obligation to register is applicable (this is the case if all necessary date can be transferred from a different Austrian register (e.g. from the company register)). The Austrian UBO Act stipulates registration until June, 1st 2018, but the registration deadline had been extended until August, 15th.

Registration of ultimate beneficial owners is to be carried out via the corporate service portal (“Unternehmensserviceportal” (www.usp.gv.at)) without any other possibility for registration. The corporate service portal requires creation of a user account. We would be happy to carry out all necessary steps for the registration of your entity in the Austrian UBO register, so that you can focus on your core business. Please find our service offer here.

No. Direct ownership not exceeding a stake of 25 % percent does not need to be reported but is instead added to the indirect ownership percentage.

Yes it is possible. An owner who is both direct and direct owner also has to be registered as both. For indirect ownership also reporting the supreme legal entity is necessary.

No. The obligation to register in the register of ultimate beneficial owners is still present, as far as an exemption from the obligation to register is not applicable. The liquidator is not be understood as holding a function within the entity in is therefore not to be reported in case no ultimate beneficial owner can be determined.

There is no necessity to change the register entry of an entity if the deceased ultimate beneficial owner had a registered domestic domicile, because in this case the register of ultimate beneficial owners is automatically updated from the civil register (“ZMR – Zentrales Melderegister”).

If the deceased did not have a registered domestic domicile the register entry needs to be updated within 4 weeks after the entity is becoming aware of the death of the ultimate beneficial owner.

In case an obliged entity does not register its ultimate beneficial owners until June, 1st 2018 (extended until August, 15th 2018) the authority initiates fiscal proceedings. If the obliged entity then carries out a registration within the next deadline, there is no sanction. If an entity continuously fails to comply to the obligation to register a fine of up to EUR 200,000 can be imposed by the authority.

In order to fulfil its purpose the register of ultimate beneficial owners is required to be up-to-date without containing wrong register entries. Therefore the Austrian authority may impose drastic fines in cases of failure to comply to the obligation to register and in cases of intentional registration of untrue ultimate beneficial owners. Fines of up to EUR 200,000 can be imposed for non compliance to the obligation to register and  intentional registration of wrong ultimate beneficial owners, while a grossly negligent registration of wrong ultimate beneficial owners can be sanctioned with a fine up to EUR 100,000. If either the authority or a professional service provider notices that the registered ultimate beneficial owner is untrue, both of them might set an annotation.

In case an ultimate beneficial owner can not be determined members of the senior management board have to be registered via a so-called subsidiary registration. The Austrian UBO Law considers them as subsidiary ultimate beneficial owners.

As the register of ultimate beneficial owners is only functional when kept up to date without containing wrong register entries, ownership changes that are relevant for ultimate beneficial ownership are to be reported to register. The obligation to report ownership changes lapses if the information about the change can be automatically transferred from a different Austrian register (e.g. the company register).

If it is impossible to determine an ultimate beneficial owner according to the Austrian UBO Act (e.g. because none of the owners holds a stake above the threshold), the members of the senior management board are to be reported via a so-called subsidiary registration. The possibility of an “empty-registration”, meaning a registration without naming any ultimate beneficial owner, is not provided.

04. Accessing the register and changing registration details

Yes. Each and every entity is entitled to access the own register entry via the corporate service portal (“Unternehmensserviceportal” (www.usp.gv.at)).

No. Due to data protection reasons the Austrian register of ultimate beneficial owners is only semi-public. Access is only granted to the authority and a limited to group of professional service providers who may access the register in course of their due diligence duties. Additionally individuals who can prove a legitimate interest to access the register can under certain circumstances access the register, but the hurdles for them are very high. Unauthorized access which is done on purpose is sanctioned with a fine up to EUR 10,000.

Every change of data deposited in the register of ultimate beneficial owner is to be filed in the register as far as the data can not be automatically transferred from a linked register (e.g. the company register). This concerns in addition to relevant changes in ultimate beneficial ownership also registration details as change of address of a foreign domicile. Changes in registration details that can be assumed from different registers do not need to be filed in the register of ultimate beneficial owners.

Access to the register is only allowed to the authority and to professional service providers in course of their due diligence duties to prevent terrorist financing and money laundering or to advise their client. Theoretically also people who are able to prove a reasonable interest to access the register are allowed to do so, but the hurdles for them are very high. However, nobody is allowed to browse the register without a predefined reason. Unauthorized access which is done on purpose is sanctioned with a fine up to EUR 10,000. Every entity is allowed to access the own register entry.

05. Register excerpts and annotations

If an entity re-registers in the register of ultimate beneficial ownership the annotations is then only visible as historical data. The person who has set the annotation will be notified that the entity has re-registered their ultimate beneficial owners.

An extended excerpt is considered complete if registered data and calculated data of ultimate beneficial owners match and no annotation is set. A complete extended excerpt may be used by professional service providers for their due diligence duties to avoid terrorist financing and money laundering.

If a professional service providers accesses the register of ultimate beneficial owners in course of fulfilling due diligence duties and draws the conclusion that the register entry does not display the true ultimate beneficial owners of the entity, the service provider may to set the annotation that the registered ultimate beneficial owner could not be verified. This information is stored in the register along with the date when the annotation was set. If a register entry carries an annotation professional service providers may no longer use an extended excerpt in course of their due diligence duties to prevent terrorist financing and money laundering.

If the authority accesses the register of ultimate beneficial owners and draws the conclusion that the register entry does not display the true ultimate beneficial owners of the entity the authority is entitled to set the annotation that the registered ultimate beneficial owner could not be verified. This information is saved in the register along with the date when the annotation was set. If a register entry carries an annotation professional service providers may no longer use an extended excerpt in course of their due diligence duties to prevent terrorist financing and money laundering.

The extended excerpt contains in addition to the information included in a simple extract from the register of ultimate beneficial owners also an automatically generated overview of all participation levels of the entity as far as relevant and available and also information about authorized representatives of the entity as far as available. The extended register excerpt furthermore contains the information, whether and which data has been transferred from a different register (e.g. the company register) along with the remark that information in the extended excerpt has been generated automatically. Also information about supreme legal entities and a calculated ultimate beneficial owner is provided. Finally the excerpt also contains the very important information whether the extended excerpt is considered as a complete extended excerpt or not.