Entry in the transparency register - by Recht 24/7

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Reporting to the transparency register is now mandatory for all companies entered in the commercial register.nullWith Recht 24/7 , you can have the registration carried out simply, quickly and by our experienced lawyers. Guaranteed uncomplicated and unbureaucratic - in no more than 5 minutes.

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Registration in the Transparency Register - What is the Transparency Register?

The transparency register is the central database in Germany that shows the beneficial owner(s) for all obligated companies. It serves to prevent or impede illegal money laundering through transparency. It has its legal basis in the Money Laundering Act (GWG ).nullA beneficial owner is a person who holds either more than 25% of the capital or more than 25% of the voting rights in a company. Until July 31, 2021, an entry only had to be made in the transparency register if the company or its beneficial owners were not already entered in another register. The Federal Ministry of Finance has appointed Bundesanzeiger Verlag GmbH as the register office.nullThe transparency register is an important instrument for preventing money laundering and other financial crime. It helps to ensure that companies make their ownership transparent and can be held accountable for suspicious activities. As it facilitates the tracing of money flows, it also helps to identify potential sources of illicit funds. The register provides additional protection against financial crime by ensuring that companies are properly identified and monitored.

Transparency register registration: Why and since when is my company subject to registration?

Legislation stipulates that, among other things, all companies entered in a German commercial register must enter their beneficial owners in the transparency register. The transparency register is a register of companies and other legal entities that are obliged to report certain information about their activities.

Entry in the transparency register: GmbH and sole proprietorship

All legal entities under private law, such as UG (haftungsbeschränkt), GmbH, AG, registered associations, foundations with legal capacity, registered partnerships, KG, OHG and PartG are required to report to the transparency register. Foundations and trusts without legal capacity are also subject to reporting requirements if the purpose of the foundation is self-interested from the founder's point of view. This includes trusts and similar legal forms.

What happens if I do not register my company or report incorrect data when registering with the Transparency Register?

If you do not comply with your obligation to register, you can expect fines. Depending on the case, these can reach up to EUR 100,000 or up to EUR 150,000 in the case of willful misconduct. The same applies to the entry of incorrect data. In the event of data inconsistencies, you can also expect to receive so-called discrepancy reports, to which you must respond within a short period of time, as fines may also be imposed.nullnullPlease note that final decisions on fines are also published on the website of the Federal Office of Administration (so-called naming and shaming) and can therefore have an impact on your reputation Fines for false or missing information are becoming increasingly common in the business world.nullCompanies that do not comply with the reporting obligations or provide inaccurate or incomplete information can be subject to severe penalties. Depending on the severity of the violation, the fines can range from 100,000 euros to 1 million euros or even 5 million euros if the violation was committed by an insurance company or a capital management company. It does not matter whether the regulations were disregarded intentionally or negligently; in any case, companies must be aware of their obligations and take measures to ensure that all entries in the transparency register are correct and up-to-date.nullBusinesses should also be aware that sanctions may be imposed for failure to report discrepancies and for breaches of registration or record-keeping obligations. It is therefore important for companies to be aware of any changes in regulations and ensure that they comply with all relevant laws. Failure to do so could result in costly fines that could have a significant impact on profits.

Publication of fines

The Federal Office of Administration has recently started to publish the names of people who have been fined since the beginning of 2020. This list is freely accessible and can be viewed on their website. The purpose of this publication is to increase transparency and accountability in government decisions. It also serves as a deterrent to those contemplating breaking the law, knowing that their actions could lead to public humiliation if they are caught.nullThe fines imposed by the Federal Office of Administration are not insignificant and can range from several hundred to several thousand euros, depending on the severity of the offense. This publication is intended as a reminder that violations of the law have consequences and to encourage people to think twice about illegal actions. Citizens can also hold their government accountable for its decisions, as they can now see exactly who has been fined and why.

Costs for the transparency register: Low annual fee

The transparency register is an excellent way of ensuring that companies are held accountable for their actions. Fortunately, registration and notifications to the body maintaining the register are free of charge. However, an annual fee must be paid to maintain entry in the register. In 2021, this fee is 11.47 euros excluding VAT and from 2022 20.80 euros excluding VAT. The Bundesanzeigerverlag usually sends the invoice for this fee together with the invoice for the disclosure of the annual financial statements.nullCompanies that were required to register in the past must pay the annual fee retroactively from 2017. For 2017, this fee is EUR 1.25 excluding VAT, for 2018 and 2019 EUR 2.50 excluding VAT and for 2020 EUR 4.80 excluding VAT. This ensures that all companies are held accountable for their actions, regardless of when they joined the register. It also helps to keep costs down while still providing a valuable service to society as a whole.

Who is the beneficial owner within the meaning of the Money Laundering Act (GwG)?

The German Money Laundering Act ( GwG ) defines a beneficial owner as any natural person who holds more than 25% of the capital shares in a company, controls more than 25% of the voting rights or exercises control in a comparable manner. This definition is intended to ensure that companies are not used for money laundering activities and that the true owners of companies are known. In some cases, however, it may be necessary to designate a fictitious beneficial owner if the actual beneficial owner cannot be identified.nullIn such cases, the fictitious beneficial owner must meet certain criteria defined by the AMLA: The fictitious beneficial owner must be an independent third party who has no direct or indirect connection with the company or its shareholders. He must also have sufficient knowledge and experience to understand his role and responsibility as a beneficial owner. Finally, he must agree to provide all relevant information about himself and his activities at the request of authorities or other bodies involved in the fight against money laundering.

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