Obligation to register and registration exemptions

Obligation to register

In principle, the Austrian UBO Act imposes an obligation to the companies to identify, report and verify their beneficial owners by themselves. This information is reported digitally to the Federal Statistical Office via the corporate service portal (“Unternehmensserviceportal” (www.usp.gv.at)) and includes the name and surname, place of residence, date and place of birth as well as the nationality of the ultimate beneficial owner(s). The nature and extent of the economic interest or the extent of participation or function within the company must also be stated.

In principle, every Austrian or relevant legal entity is obliged to report the requested data to the registration authority. It can be assumed that the (Austrian) UBO register will contain around 350,000 register entries - in addition to the ultimate beneficial owners of stock companies and limited companies, the register should also contain the beneficial owners of limited partnerships, banking institutions, associations, private foundations and domestically managed trusts.

Although during implementation of the Austrian UBO Act it has been emphasized that the registration of ultimate beneficial owners (UBOs) should be as simple and uncomplicated as possible, the determination of ultimate beneficial owners may be difficult for some legal entities. Therefore, the law also provides for the possibility for representatives (auditors, tax advisors, notaries, lawyers, accountants, accountants and personnel accountants) to identify and verify beneficial owners for their clients and also to report them to the register through the corporate service portal.

The first registration must be completed by August, 15th 2018 at the latest. After this date, newly created legal entities need to register themselves within four weeks after their entry in the corresponding master register (eg company register). Relevant changes in beneficial ownership must also be reported by the parties themselves within four weeks. In order to fulfill their duty of care, affected legal entities must also check at least once a year whether their entry in the UBO register is still up-to-date. Copies of relevant documents and information shall be kept for at least 5 years after end of beneficial ownership.

Registration exemptions

The Austrian UBO Act also provides exemptions from the obligation to register. Under certain circumstances the information already available in official registers (e.g. in the commercial register) is used to determine the beneficial owner and the data is automatically transferred to the UBO register. The aim is to reduce the administrative burden of reporting obligations by using existing data on beneficial owners of legal entities. In total, around 285,000 of the 356,000 domestic legal entities are exempted from the obligation to register.

For example, individual entrepreneurs as well as partnerships (mainly OG and partly KG), are exempt from the obligation to register if all shareholders are natural persons and no third party directly or indirectly exercises control over the management. Also limited liability companies are exempt from the obligation to register if their true beneficial owners are already registered in the commercial register (i.e. all shareholders are natural persons and no control is exercised from 3rd-parties.).Generally an exemption is not possible if one or more shareholders are a legal person or if a third party exercises direct or indirect control over the management.

An automated comparison with the respective master registers (i.e. the central civil register) ensures that only existing domestic natural persons and domestic legal entities can be reported. For foreign natural persons passport copies or comparable documents suitable for proof of identity are to be deposited in the register, which are also stored there. In combination with the sanctioning of intentional breaches of duty, general preventive incentives to avoid intentional false reports are set. In order to keep the expenses of those affected as low as possible by means of this additional reporting obligation, all legal entities that already have data on their beneficial owners in the commercial register or in the register of associations are exempted from the obligation to register if the deposited data also represents the actual beneficial owners in the definition of the Austrian UBO Act.

A possibility of an "empty registration" is not provided in the Austrian UBO Act: For example, if a controlling owner is missing or can not be identified, the members of the top management level are to be registered as beneficial owners.