On 23/02/2021, the Republic of Cyprus implemented the provisions of the 5th Anti-Money Laundering EU Directive 2018/843 on its national legislation, whereby it was decided to establish central registers of ultimate beneficial owners. When it comes to the Trusts, there will be a separate register being the Register of Beneficial Owners of Express Trusts and similar legal arrangements.
The term “express trust” refers to the trusts created expressly by a settlor at their own will, and does not include trusts arising by operation of law nor trusts for which the settlor shows no clear intention for their creation.
Express trusts must be registered provided that:
Pursuant to the provisions of the 5th AML Directive and amendment of the national law with respect to the establishment of the Trusts UBO Registry, Cyprus Securities & Exchange Commission (CySec) will undertake to create and manage the Cyprus Trusts Beneficial Owners Registry (CyTBOR).
On 18/06/2021, CySec pursuant to Article 61C of the Prevention and Suppression of Money Laundering and Terrorist Financing Law of 2021 (AML Law) issued a regulation (Regulatory Administrative Act 257/2021) (the Directive) identifying the procedure of registration with CyTBOR. The information/data required for the CyTBOR will be different from the existing registries maintained by the three current supervisors (CySec, Cyprus Bar Association, Institute of Certified Public Accountants).
All new trusts will be registered with the CyTBOR, which is expected to become operational by the end of 2021 and any existing trusts that are registered under CySec, Cyprus Bar Association and Institute of Certified Public Accountants will need to be transferred to the new CyTBOR. It will be the responsibility of the Trustees of each Trust that is already registered with one of the current supervisory authorities to arrange the registration with the CyTBOR as soon as it becomes operational, according to the provisions of Article 61C of the AML Law.
Cysec will have full access to the data and information submitted and maintained in the CyTBOR.
According to the Directive of CySec, access to the CyTBOR is granted:
Further clarifications with respect to the above persons/entities that can have access to the CyTBOR is provided below:
Obliged entities: As defined by Section 2A of the AML law, means
The obliged entities will have access to the following information in relation to the Beneficial owners of an express trust or similar legal arrangement:
Legitimate interest:
The framework regarding accessing the information on the beneficial ownership of a trust on the basis of a ‘legitimate interest’, is provided in section 61C (12)(c) of the AML/CFT Law and paragraph 13 of the Directive. CySEC will decide ‘legitimate interest’ on a case by case basis taking into account what is provided in section 61C (12)(c) of the AML/CFT Law and paragraph 13 of the Directive, and more specifically that, the person requesting access to the information, has satisfactory demonstrated, with supporting evidence and information, that his interest is specifically related to and contributes to the combating of money laundering and the financing of terrorism, including such evidence and information from previous actions and activities taken to that direction. Note that all CySEC decisions are, in every case, fully justified
The following information needs to be registered in CyTBOR with respect to the Trusts:
The following information needs to be registered in CyTBOR for the Ultimate Beneficial Owners of the Trust as well as the Trustee, Settlor, Protector:
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