Entry in the trans­par­ency register

The trans­par­ency register applic­a­tion was made man­dat­ory in Ger­many in 2017 and aims to record and dis­close the bene­fi­cial own­ers of com­pan­ies and organ­isa­tions. This meas­ure is inten­ded to cre­ate trans­par­ency and com­bat money laun­der­ing and ter­ror­ist fin­an­cing.

The register is inten­ded to help expose opaque cor­por­ate struc­tures that are often used to con­ceal money flows and illegal activ­it­ies. It is part of EU-wide efforts to com­bat money laun­der­ing and ter­ror­ist fin­an­cing.

Once entered in the com­mer­cial register, a newly foun­ded com­pany is imme­di­ately required to be entered in the trans­par­ency register. As soon as the extract from the com­mer­cial register is avail­able, the entry should be made imme­di­ately, i.e. within two weeks.

Who is the bene­fi­cial owner?

Own­ers or share­hold­ers who hold more than 25 % of the shares or per­sons who con­trol more than 25 % of the vot­ing rights through a part­ner­ship agree­ment or oth­er­wise exer­cise sig­ni­fic­ant influ­ence over the com­pany are deemed to be bene­fi­cial own­ers for the pur­poses of the trans­par­ency register noti­fic­a­tion. How­ever, if no share­holder exceeds this threshold, the man­aging dir­ector is entered as the “notional bene­fi­cial owner” and must be repor­ted accord­ingly.

Legal forms affected

In prin­ciple, all legal entit­ies and registered part­ner­ships in Ger­many are obliged to dis­close their bene­fi­cial own­ers in the trans­par­ency register.

1. Legal entit­ies under private law
   - GmbH (lim­ited liab­il­ity com­pany)
   - AG (pub­lic lim­ited com­pany)
   - SE (European Com­pany)
   - e.V. (registered asso­ci­ation)
   - Co-oper­at­ives
2. Registered part­ner­ships
   - OHG (gen­eral part­ner­ship)
   - KG (lim­ited part­ner­ship)
   - GmbH & Co. KG
3. Part­ner­ship com­pan­ies (PartG)
   - Found­a­tions
   - Asso­ci­ations, if they are eco­nom­ic­ally act­ive
   - Trusts and fidu­ciary con­struc­tions, provided they have com­par­able struc­tures to com­pan­ies

An example of a trans­par­ency register applic­a­tion with a dir­ect and indir­ect share­hold­ing could look like this:

ABC GmbH” has the fol­low­ing own­er­ship struc­ture:

1. Mr Meier dir­ectly owns 30 % of the shares in “ABC GmbH”.
2. Mrs Schmidt dir­ectly owns 20 % of the shares in “ABC GmbH”.
3. The XYZ Hold­ing GmbH owns 50 % of the shares in “ABC GmbH”.
4. The XYZ Hold­ing GmbH belongs to 60 % Mr Müller and to 40 % Mrs Bauer.

Cal­cu­la­tion of dir­ect and indir­ect share­hold­ings

Dir­ect invest­ments:

• Mr Meier30 % dir­ectly to “ABC GmbH”.
• Mrs Schmidt20 % dir­ectly to “ABC GmbH”.

Indir­ect invest­ments via XYZ Hold­ing GmbH:

• The XYZ Hold­ing GmbH holds 50 % of the shares in “ABC GmbH”. These shares are dis­trib­uted accord­ing to the share­hold­ings of Mr Müller and Ms Bauer in the hold­ing com­pany:
  
  1. Mr Müller owns 60 % of the shares in XYZ Hold­ing GmbH. His indir­ect share­hold­ing in “ABC GmbH” is there­fore:
  60% × 50% = 30%
  
  2. Mrs Bauer holds 40 % of the shares in XYZ Hold­ing GmbH. Your indir­ect share­hold­ing in “ABC GmbH” is there­fore:
  40% × 50% = 20%

Who must be entered in the trans­par­ency register?

• Mr MeierSince he holds 30 % of the shares dir­ectly (over 25 %), he must be registered as the bene­fi­cial owner.
• Mr MüllerHe indir­ectly con­trols 30 % of the shares (over 25 %) and must also be registered as the bene­fi­cial owner.
• Mrs Bauer: Your indir­ect share­hold­ing is 20 %, i.e. less than 25 %. It must there­fore not be entered.
• Mrs SchmidtIt dir­ectly holds 20 % of the shares, which is also less than 25 %, and must there­fore not be entered.

Con­clu­sion
This example shows how both dir­ect and indir­ect share­hold­ings are cal­cu­lated and assessed in order to determ­ine who must be recor­ded as the bene­fi­cial owner in the trans­par­ency register. In this case, Mr Meier and Mr Müller are required to report.

Trans­par­ency register entry: step by step

1. Cre­ate a user account: First, you need to cre­ate a user account on the Trans­par­ency Register web­site. To do this, you enter your per­sonal and con­tact details and then gain access to the sys­tem.
2. Store com­pany inform­a­tion: After cre­at­ing an account, you can enter the com­pany details. This includes the name of the com­pany, the legal form, the com­mer­cial register num­ber and the address.
3. Enter the bene­fi­cial owner: In the next step, the bene­fi­cial own­ers are entered. This includes the nat­ural per­sons who dir­ectly or indir­ectly own more than 25 % of the shares or vot­ing rights or exer­cise con­trol in some other way. Per­sonal data such as name, date of birth and place of res­id­ence are entered for each author­ised per­son.

Cre­ation of an account: Cre­at­ing an account is quick and easy and takes place in four clearly struc­tured steps. The fol­low­ing screen­shots show the pro­cess and illus­trate how user-friendly the pro­ced­ure is

2. store com­pany inform­a­tion: Regis­tra­tion in the trans­par­ency register is designed to be user-friendly and is accom­pan­ied by a struc­tured set-up wiz­ard that guides the account admin­is­trator through the entire pro­cess in just a few steps.

1. search for your own com­pany (select legal entity): Firstly, the com­pany is registered by enter­ing the com­pany name and start­ing the search.

2. link to the com­mer­cial register data: The sys­tem provides the appro­pri­ate entry from the com­mer­cial register and auto­mat­ic­ally assigns the com­pany to the cor­res­pond­ing data in the trans­par­ency register.

3. com­plete address details and register com­pany: The address details are then com­pleted and an email address is entered for any quer­ies. By click­ing on “Register legal entity”, the com­pany is cor­rectly registered in the trans­par­ency register and the legal require­ments are ful­filled.

To illus­trate the sim­pli­city and struc­tured pro­cess, we have provided some screen­shots below:

3. enter the bene­fi­cial own­ers: In the final step, the bene­fi­cial own­ers are recor­ded.

1. first-time bene­fi­cial owner: As this is a new entry, the account admin­is­trator must select the option “Add bene­fi­cial owner for the first time”.

2. determ­ine the start of valid­ity: The date from which the per­son is deemed to be the bene­fi­cial owner is then spe­cified.

3. enter per­sonal data: The bene­fi­cial own­ers are then recor­ded indi­vidu­ally. The trans­par­ency register dis­tin­guishes between actual bene­fi­cial own­ers and fic­ti­tious bene­fi­cial own­ers.

4. select eco­nomic interest: Finally, the eco­nomic interest of the per­son is determ­ined on the basis of the avail­able options.

The fol­low­ing options are avail­able:
- Cap­ital share > 25 %
- Num­ber of vot­ing rights > 25 %
- Other con­trol influ­ence on the com­pany

As soon as all per­sons have been entered, the account admin­is­trator checks the sum­mary and con­firms the entry by click­ing on the “Send noti­fic­a­tion” but­ton. This suc­cess­fully com­pletes the regis­tra­tion in the trans­par­ency register.

Click here to register in the trans­par­ency register.

Import­ant inform­a­tion on final­isa­tion

1. costs and fees: The pro­cess of regis­ter­ing and record­ing the com­pany and the bene­fi­cial own­ers in the trans­par­ency register is free of charge. Since 2022, how­ever, an annual fee of €20.80 has been charged for the entry and any updates. The invoice for the entry in the Trans­par­ency Register is issued by Bundes­an­zei­ger Ver­lag.

2. import­ance of con­tinu­ous updat­ing: Deal­ing with the trans­par­ency register is not just a one-off task. Entre­pren­eurs and share­hold­ers are leg­ally obliged to keep their entries up to date at all times. Changes to the com­pany must be promptly updated in the trans­par­ency register.

Which changes need to be updated?

• 1. entry of new share­hold­ers: New share­hold­ers must be registered imme­di­ately.
• 2. sale of shares: Changes in share­hold­ings must be adjus­ted.
• 3. cap­ital increases: An increase in share cap­ital must also be recor­ded in the trans­par­ency register.
• 4. cor­rect incor­rect entries: Dis­crep­an­cies must be repor­ted and cor­rec­ted.

Incor­rect entries can res­ult, for example, from an incor­rect com­pany name, incor­rect details of the bene­fi­cial own­ers or an incor­rect name. Such entries must be cor­rec­ted imme­di­ately in order to ensure trans­par­ency and ful­fil legal require­ments.

3. pen­al­ties

If you do not register your com­pany in the trans­par­ency register, you can expect to pay sub­stan­tial fines. These start at €100 and can go up to €150,000 for ser­i­ous offences or intent. Each bene­fi­cial owner can be pen­al­ised indi­vidu­ally. Fail­ure to notify changes

Ber­lin office
Bleib­treustrasse 38/39
10623 Ber­lin

info@start-bereit.com
+49 30 41734256