{"id":140,"date":"2014-11-17T14:04:06","date_gmt":"2014-11-17T14:04:06","guid":{"rendered":"https:\/\/baron.yakimaxim.site\/a-new-law-on-identification-of-ultimate-beneficiaries-nuisance-or-necessity\/"},"modified":"2026-01-30T12:42:34","modified_gmt":"2026-01-30T12:42:34","slug":"a-new-law-on-identification-of-ultimate-beneficiaries-nuisance-or-necessity","status":"publish","type":"post","link":"https:\/\/frishberg.com\/uk\/a-new-law-on-identification-of-ultimate-beneficiaries-nuisance-or-necessity\/","title":{"rendered":"A New Law on Identification of Ultimate Beneficiaries: Nuisance or Necessity?"},"content":{"rendered":"
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November 17, 2014 <\/em><\/p>\n

Ukrainian law makers are notorious for passing ambiguous laws that appear to have good intentions, but ultimately cause negative consequences for the economy. As a rule, the full ramifications of these laws are not adequately considered prior to their passage, and the impact on foreign investment is usually not taken into consideration at all during the legislative drafting process. In the end, these laws are heavily amended or simplified once the practical problems related to their implementation come to the forefront (e.g., see the personal data protection legislation). <\/span><\/p>\n

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Unfortunately, the law \u201cOn Amending Certain Laws of Ukraine Related to Identification of Ultimate Beneficiaries of Legal Entities and Public Figures\u201d (the \u201cLaw\u201d), which was signed on October 23, 2014, and comes into effect on November 29, 2014, is just this type of law. While the fight against money laundering is a noble task, the Law imposes quite a draconian compliance requirements on existing Ukrainian companies with large, global foreign shareholders. <\/span><\/p>\n

In a nutshell, the Law obliges founders of Ukrainian companies to disclose their \u201cend beneficiaries\u201d upon registration of their legal entities in Ukraine. Those Ukrainian companies that were registered prior to the Law\u2019s effect will have six months to disclose their end beneficiaries from the date the Law comes into effect. <\/span><\/p>\n

The Law of Ukraine \u201cOn Prevention of and Countermeasures Against the Legalization (Laundering) of Income Obtained by Criminal Means or Financial Terrorism\u201d broadly defines \u201cend beneficiary\u201d or \u201cultimate beneficiary\u201d as a natural person who, regardless of formal possession, is able to decisively influence the management or commercial activity of a legal entity directly or via other parties. Such decisive influence means that the individual can: <\/span><\/p>\n<\/div>\n

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