Launch of Systematic Police Controls

Register of Beneficial Owners (RBE) and Registered Office

The law of 1 March 2019 on the Register of Beneficial Owners (RBE) aims to combat money laundering and terrorist financing in Luxembourg. It requires relevant entities to correctly identify their beneficial owners and register them, under penalty of significant criminal sanctions.

According to a recent communication from the Public Prosecutor’s Office of the Grand Duchy of Luxembourg, a campaign of systematic controls has been launched across the entire territory, in collaboration with the Grand Ducal Police. In the coming weeks, inspections will focus in particular on compliance with RBE obligations as well as the reality and organisation of declared registered offices.

What to expect?

Unlike simple administrative reminders, these are physical on-site inspections at company premises. The authorities will verify the following elements in particular:

• Actual existence of the registered office: presence of a visible nameplate, accessibility of the premises, and reality of central administration at the declared address.
• Accuracy of RBE data: compliance, completeness, and currency of information registered with the Luxembourg Business Registers (LBR) concerning shareholding and control.
• Staff present on site: ability of persons present to clearly identify the company and its management bodies.
• Availability of supporting documents: ability to present proof of identity of beneficial owners without delay.

Purpose

To strengthen the fight against money laundering and terrorist financing by ensuring transparency regarding the true economic owners.

Risk of sanctions

• Criminal fines from EUR 1,250.00 to EUR 1,250,000.00.
• Daily penalty payment of EUR 40.00 up to a total cap of EUR 3,600.00.
• Judicial dissolution, particularly for companies that are “untraceable” at their registered office or non-compliant, which may lead to dissolution without liquidation or court-ordered liquidation.
• Criminal liability of directors or management bodies.
• Administrative sanctions.

Compliance recommendations

In order to approach a potential inspection with confidence, a prompt review of company information and RBE data is strongly recommended. Particular attention should be given to the following points:

• Check signage: the company name must be clearly visible at the building entrance.
• Review the website: the site must include mandatory legal notices, in particular the company name, trade name, RCS number, business licence, and registered office.
• Audit of the RBE registration: verify with the Luxembourg Business Registers (LBR) that addresses, beneficial owners, ownership percentages, and control arrangements are accurate and up to date.
• Gather supporting documents: copies of identity documents of beneficial owners as well as documents relating to the control structure (share register, shareholders’ agreement, minutes) should be readily accessible.
• Review the domiciliation: the declared registered office must correspond to the place of effective management of the company.

Need assistance?

A quick review of your company’s records can help you identify risks swiftly and make the necessary adjustments.