Slovakia puts new emphasis on AML compliance

5 October 2020 - Like most countries in the EU, Slovakia has been working on ensuring compliance with the 4th EU AML Directive. Slovakia’s current political leaders have put more emphasis on legal entities to ensure that they are not in breach of the Act No.297/2008 Collection of Laws on the Prevention of Legalization of Proceeds of Criminal Activity and Terrorist Financing (the AML Act).

Most companies, and other legal entities registered prior to 1 November 2018, were required to register their Ultimate Beneficial Owners (UBO) by 31 December 2019.

The AML Act says that a UBO is a natural person who ultimately owns or controls, either directly or indirectly, a company or other legal entity, or is a natural person on whose behalf a company or legal entity carries out its business activities. This will be a natural person who:

  • holds (directly or indirectly) at least 25% of the voting rights or a 25% share in the registered capital of the legal entity;
  • has the right to appoint or recall a statutory body, executive body, supervisory body or other controlling body of the legal entity or any of its members;
  • controls, in practice, a legal entity other than as described above;
  • has at least a 25% share of the benefits from the legal entity’s business (dividends and similar payments).

If there are no natural persons, senior management must be reported as UBOs.

Companies are under an obligation under the AML act to keep internal UBO registers. This register must be updated and maintained while the natural person is considered a UBO and five years after termination of the relationship with the company or legal entity.

The Act also requires companies and other legal entities to provide UBO information to the Register of UBOs. This information is not publicly available, but it can be accessed by certain state authorities, courts, police and other “obliged persons”.

Companies or legal entities that do not comply with the AML Act may be fined:

  • up to EUR 200,000 if the company does not keep and maintain a UBO register;
  • up to EUR 3,310 imposed on the directors personally, if the company does not register its UBO.

 

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