Beneficial ownership registers and protection mechanisms for beneficial ownership rights in foreign countries and in our country

Аннотация

Many countries around the world are promoting the increase of transparency regarding the ultimate ownership of companies. Indeed, this is a useful tool for stopping illicit financial flows and creating fair markets. However, it must also be considered that such measures may violate the right to privacy and pose threats to personal security. The need to protect this privacy may lead some companies and owners to refuse to disclose this information. Furthermore, many organizations and individuals have warned that disclosing beneficial ownership information may be ineffective or could lead to the spread of incorrect information. Keywords: Beneficial Ownership, beneficial property, public register. India, the United Kingdom, Germany, France, Spain, Introduction: Many countries around the world have and Italy, have started to introduce stricter regimes or adopted the concept of beneficial ownership as an mechanisms for companies to disclose the beneficial economic term. In Spain, however, the idea of ownership rights of their owners. The goal is to increase beneficial ownership, or beneficial property, was transparency in corporate activities and combat money mistakenly interpreted as an economic term and laundering, financing terrorism, tax evasion, and other considered as a rule for the distribution of income. illegal activities. However, the reference to the economic term was It is important to create mechanisms to identify removed by the OECD (Organisation for Economic Co- individuals hidden behind complex corporate operation and Development) in 2023, and it was structures. concluded that in common law systems, beneficial ownership is nothing more than a "legal Failure to provide information on the ultimate interpretation." beneficial owners or failing to do so in a timely manner, or knowingly submitting false information, is subject to Beneficial ownership originated in England, and several varying penalties under national legislations. years ago, a group of experts in England discussed the meaning of beneficial ownership and beneficial O. Fridman and others confirmed that legal ownership ownership rights, with much uncertainty surrounding is recognized as the right of an individual to control and the issue. possess something. For example, if someone buys a vehicle or a house with full payment, they have the In Russia, cases related to beneficial ownership are right to alter and use it as they wish (within legal often resolved through corporate decisions and boundaries). transactions, such as the "Doctrine of Shareholder Restoration," "Doctrine of Lifting the Corporate Veil," Similarly, the legal owner is recognized by law as the and the "Doctrine of Beneficial Ownership. owner of something, specifically, an individual who holds the legal title to property for the benefit of Today, many countries around the world, particularly another. International Journal of Law And Criminology 54 https://theusajournals.com/index.php/ijlc International Journal of Law And Criminology (ISSN: 2771-2214) On the other hand, as M. Graziadei emphasized, On September 1, 2019, Luxembourg notably launched beneficial ownership can be traced back to the history a public register of beneficial owners. Anyone can of trust law, which emerged from the principle of access the website (https://www.lbr.lu/) and obtain equality in the 12th-13th centuries. free information about any company. The site even offers an option to access anonymous data. This term is used differently from the term "legal ownership." Additionally, other terms are often used to Beneficial ownership registers exist in many countries, convey the same meaning, such as beneficial right, including Germany, Belgium, Austria, Ireland, Latvia, equal right, beneficial interest, and equal ownership. Luxembourg, Slovenia, and Latvia. In the CIS region, such registers are also present in Russia, Ukraine, According to E.A. Sukhankov, although the trustee Belarus, and Armenia. exercises the powers (orders) of the property owner, they do not acquire these rights based on the waiver of In Japan, as part of measures to identify beneficial the trustee's claim. owners of legal entities, a system for listing the beneficial owners of legal entities was established on According to U.S.A law, beneficial ownership refers to January 31, 2022. the true, primary ownership rights to an asset or property, even if the legal or title ownership is under a the nominal owner may act on behalf of the beneficial different name. This concept is particularly important owner but does not benefit from these privileges. for transparency and compliance with regulatory However, in many states, including the notably documents in finance and legal fields. The beneficial prominent state of Delaware, corporate entities are owner enjoys privileges such as earning income from or allowed to form without disclosing information about controlling the asset, while the nominal owner may act their ownership structure to the