The Court of Justice of the European Union has recently ruled that access to the information in the UBO register by the public is invalid.
As you probably already know, the UBO register is a central register in which all "Ultimate Beneficial Owners" of a company or other legal entity must be registered. These are the individuals who own, control or have a controlling interest in an entity.
1. What has the court of justice ruled?
The Court ruled that access to the UBO register and to information on beneficial owners by the public constitutes a serious interference with the right to respect private life and the protection of personal data.
As regards the seriousness of that interference, it is important to note that this information is capable of enabling a profile to be drawn up concerning certain personal identifying data more or less extensive, the state of the person’s wealth and the economic sectors, countries and specific undertakings in which he or she has invested. In addition, that information can be freely accessed also by persons who, for reasons unrelated to the objective pursued by that measure, seek to find out about, inter alia, the material and financial situation of a beneficial owner. Furthermore, the potential consequences for the data subjects resulting from possible abuse of their personal data are exacerbated by the fact that, once those data have been made available to the general public, they can be also retained and disseminated. In the event of such successive processing, it becomes increasingly difficult, or even illusory, for those data subjects to defend themselves effectively against abuse.
On the other hand, privacy rights can only be restricted by a measure that pursues the public interest and is necessary and proportionate.
The UBO register was introduced by a European Directive whose main objective was to combat money laundering and terrorist financing. It is in that context that the UBO register in Belgium was made available to the public without restriction.
But the Court of Justice ruled that this accessibility to the public of the UBO register was not strictly necessary to prevent money laundering and terrorist financing and was therefore disproportionate to the objective pursued.
2. What is the consequence?
The consequence is that the Public Service of Finance, which manages the UBO register, has announced a temporary suspension of the general public's access to information on beneficial owners.
But beware! This does not change the duty of legal entities to register and update the UBO register. So, the obligation to register the UBO in the UBO register and to update it when necessary, and at least to confirm annually, remains.
Meanwhile, the Belgian legislator will have to re-evaluate the accessibility of the UBO register taking into account the ruling European Court of Justice.
We will be happy to keep you informed about this.