UBO stands for Ultimate Beneficial Owner, or the beneficial owner of a business, organization or trust. This is the person or group of individuals who ultimately control the entity and make decisions about such things as investments and expenditures.
The concept of UBO refers to identifying the true owner or beneficial owner of an entity, such as a corporation, partnership or trust. It is intended to promote transparency and facilitate the prevention of money laundering, tax evasion and terrorist financing.
In some countries, including the Netherlands, it has been mandatory for several years to register the UBOs of a company, organization or trust. This is stipulated in the Money Laundering and Terrorist Financing (Prevention) Act (Wwft). This means that the UBOs of a company, organization or trust must register with a register set up specifically for this purpose.
Registering and identifying UBOs aims to create transparency and prevent entities from being used for criminal activities. This information is often stored in a UBO registry, which is accessible to competent authorities and sometimes to the public. The goal is to promote openness and transparency and enable information sharing between countries. By knowing who the UBOs are, governments and regulators can monitor the financial system more effectively and prevent possible illegal activities.
Further, entities often have legal obligations to identify, update and maintain information on UBOs. Failure to comply with these obligations can result in fines, penalties or even the dissolution of the entity. Therefore, it is important for organizations to understand and comply with UBO regulations.
