During a recent session of the Parliamentary Committee on Trade, a proposal was discussed to cancel fines totalling €14 million that were imposed for delays in submitting Ultimate Beneficial Owner (UBO) information. The solution under consideration involves replacing these fines with a one-off penalty of €250. The government has expressed support for this approach, which seeks to ease the burden on businesses while maintaining compliance with UBO regulations.
To date, fines between €13 million and €14 million have been imposed, though only €600,000 has been collected. The new proposal suggests a significant reduction in the maximum fines for both companies and their directors, with the one-off €250 fine applying uniformly. The current system of daily and cumulative penalties, widely regarded as excessive, would also be revised.
Several MPs and officials have noted that the existing fines are disproportionately high, especially for smaller businesses. Some have highlighted cases where small family-run companies were penalised with fines as high as €80,000, an amount that could drive them out of business.
As the discussions move forward, these proposed changes are seen as a necessary step to strike a fair balance between enforcing UBO requirements and acknowledging the financial pressures faced by companies. Final decisions are expected to be made in upcoming committee sessions, with the aim of implementing a more equitable and manageable regulatory framework for businesses.
In case you require any clarification or assistance in submitting the required information in the Register of Beneficial Owners of the Department of Registrar of Companies and Intellectual Property, as well as the Cyprus Trusts Beneficial Owners Registry overseen by the Cyprus Securities and Exchange Commission, please contact us at info@compliancemk.com.
