New money laundering prevention rules: By 31 May 2019 companies are to declare their beneficial owners

According to the new Money Laundering Prevention Law of 2018 certain legal entities, registered in Bulgaria, are required to declare their beneficial owner (i.e. the physical person who ultimately owns the company’s shares). The declaration is to be made not later than 31 May 2019 with the Trade Register, the NGO Register and the BULSTAT Register.  There is an exception of this timeline for NGOs, which have or will complete their registration under the new NGO regime after 1 January 2019 – in such case the filing term is 4 months after the new registration. The filing is mandatory unless the information about the beneficial owner has already been recorded in the respective register on other grounds. For example, the sole shareholder of a limited liability company who is a physical person and as such is recorded in the Trade Register does not need to file a separate declaration under the new Money Laundering Prevention Law. 

The declaration should provide the following information about the beneficial owners: names, citizenship, UCN or date of birth, country of residence (if different from Bulgaria or the country of citizenship). It should indicate also the legal entities, which control – directly or indirectly – the subject of the declaration. When the legal representative of the legal entity does not reside permanently in Bulgaria, then the declaration is to provide contact data with a person who is Bulgarian resident (together with his/her  notarized consent to act as a point of contact).  

The information about beneficial owners will not be public – the access to is shall be limited to certain authorities (the Directorate of Financial Investigation of the National Security Agency, the Bulgarian National Bank, the Financial Supervision Commission, etc.) as well as to professionals who are required by law to apply money laundering prevention measures in their work (e.g. notaries, accountants, lawyers, insurance companies). 

Failure to declare the information in time is likely to trigger a penalty from BGN 1,000 to  BGN 20,000 (approx. EUR 500 – 10,000). The penalty is to be imposed repeatedly monthly until the declaration is filed.