Until 1 January 2021 all branches and representative offices of the foreign entities registered with the Latvian Register of Enterprises, as well as permanent representative offices registered with the tax payers register maintained by the Latvian State Revenue Service, are obliged to disclose their ultimate beneficial owners (“UBO”).
In case any of the above entities will fail to provide information on their UBO until the given deadline, the Register of Enterprises or the State Revenue Service (with regards to the permanent representative offices) will remove the branch or representative office from the respective register and the entity will thereby cease to exist.
We kindly remind you that under provisions of Law on Prevention of Money Laundering and Terrorism and Proliferation Financing, a UBO is a natural person, who either owns the respective entity, implements control over it or in the interests of which respective entity is established, and who:
- directly or indirectly owns more than 25% of shares or stocks with voting rights in the legal person to whom the branch or representative office belongs, or
- directly or indirectly implements control over it.
In order to meet the above requirements, branches and representative offices will be obliged to disclose information on their UBO and chain of entities, through which control over branch or representative office is implemented. Furthermore, the branches and representative offices will need to provide documents that justify the reported information on the identity of UBO and the manner how the UBO exercises his or her control.
The reporting obligation also applies in case the branch or representative office concludes that there is no natural person who should be considered as UBO, or the respective entity has no obligation to disclose its UBO.
Please note that the compliance with the above-mentioned requirements requires certain preparation therefore we suggest not to delay the reporting of UBO. For any queries in regard to the disclosure of UBOs for branches and representative offices please contact Partner Gatis Flinters or Associate Marija Berdova.