Created as a mechanism to provide the Government with more tools to fight tax fraud, Decree No. 41040-H created the “Regulation of the Transparency and Final Beneficiaries Registry”. This Registry will be elaborated by means of the information that, in a mandatory way, must be provided by certain subjects, cataloged by Law as obliged, about who their shareholders and final beneficiaries are, as long as their participation within the corporation is substantive.
The final or effective beneficiary is a natural person who exerts a substantive influence or control, directly or indirectly, on the corporation or legal structure so that he or she has the majority of the voting rights of the shareholders or partners, has the right to designate or cease most of the administrative, management or supervisory bodies; or who has the control status of that company by virtue of its bylaws.
Under this Regulation, corporations (commercial companies), other legal structures (any integration or association whose organization is carried out on a legal basis), third-party resource managers in favor of their clients, non-profit organizations and all private trusts, including those that are elaborated by financial entities.
The final objective of the Registry is to control the use of these figures that could be used to hide the true economic capacity of the person that is behind the corporation, thus avoiding the management, control and collection of taxes.
The information must be provided annually (from April 1st to the 30th), with an extraordinary period of 15 business days to provide the information, each time a change is made in the shareholding composition or final beneficiaries, in where their share within the entity is equal to or greater than 15% of the total capital.
This Registry should have entered into force in March of this year, however, the Ministry of Finance granted a six-month extension to provide the data, moving the date to September 2019, being for the first and only time staggered for months, according to the last digit of the legal ID, in this way, as an example, a corporation whose legal ID ends in 0 and 1, will have to complete the information in the Registry as of September, the legal IDs ending in 2 and 3, they must do so in October and so on in groups of two, concluding in January 2020 with those entities whose legal ID number ends in 8 and 9.
The information provided by the legal structures will have the character of an affidavit and will necessarily be provided by the legal representative of the corporation, defined by the Regulation (legal representative for corporations and legal structures, the trustee in the case of trusts, legal representative or agent for third-party resource management and the president or representative, in the case of non-profit organizations).
The control can be direct or indirect:
- Direct: When the natural person owns enough shares or participations to control the corporation or the national legal structure.
- Indirect: The control over the legal entity that, in turn, has participation in the national legal entity or corporation.
If the shareholding belongs to a foreign legal entity, in case it is impossible to identify the final beneficiary, provided there are no grounds for suspicion, it will be presumed that the final beneficiary is the administrator (natural person exercising legal representation of the corporation domiciled abroad, according to the Regulation).
Additionally, the respective official documents that are generated in the foreign country and that demonstrate the impossibility of identifying the final beneficiaries, whether certifications issued in transparency records located in the country of origin, certification of statutes or any other document must be attached valid, by means of which it is stated that there is no information on who the final beneficiaries are, or that the share capital consists of bearer securities.
With the entry into force of the Registry, a new obligation is established for Notaries Public to consign in any document that involves a corporation or legal structure obliged to inform about its shareholders and final beneficiaries, when said obligors have not complied with the provision of information to the registry.
That is, before issuing any document on an obligated subject, the Notaries must verify the list of subjects who have not complied with the provision of information established by the Law and that the Central Bank will create for this purpose, in order to record in the documents to be issued, that the obligated subject is within the list of defaulters, being able to access this list through their digital signature and, to verify the status of Notary, the Registry will confirm the information in real time before the National Directorate of Notaries .
In addition, the National Registry will not register or issue any document related to the subjects bound by the Law that are on the list of defaulters.
In addition to what was mentioned above, in case of default, there will be a penalty of 2% of the gross income in the tax statement of the corporation of the previous immediate fiscal period, with a minimum of 3 and with a maximum of 100 base salaries ( ¢1,300,000.00 and a maximum of almost ¢ 5,000,000.00); also, the obliging non-compliant subject will appear on the public list of omissions.
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