ECJ Ruling Ends Unlimited Public Access to UBO Registers

On 22 November 2022, the European Court of Justice (ECJ), sitting as the Grand Chamber, ruled in relation to the Directive 2018/843 that its provision whereby Member States must ensure that the information on the beneficial ownership of companies incorporated within their territory should be accessible in all cases to any member of the public is invalid. The decision of partial invalidation therefore relates to the provision of the Directive itself and not to the transposition of the Directive into Cypriot national law, as Cypriot legislation is in conformity with the Directive.

On the same day, because of this ruling, public access to the UBO register was suspended in several Member States.

https://curia.europa.eu/jcms/upload/docs/application/pdf/2022-11/cp220188en.pdf

In its reasoning, the ECJ, was of the opinion that the general public’s access to information on beneficial ownership constitutes a serious interference with the fundamental rights to respect for private life and to the protection of personal data. Indeed, the accessible information makes it possible to create a profile with certain personal data, the financial situation of the person concerned and the economic sectors, countries, and specific companies in which the beneficial owner has invested.

The information disclosed enables a potentially unlimited number of persons to find out about 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 cannot only be freely consulted, but also retained and disseminated.

In its reasoning, the Court of Justice of the European Union states that public access to the register of beneficial owners entails an interference with the right to respect for their private and family life under Article 7 and the right to the protection of personal data relating to them under Article 8 of the Charter of Fundamental Rights of the European Union, which, in the view of the Court of Justice of the European Union, is neither necessary nor proportionate in the light of is on the objective of the 5th Anti-Money Laundering Directive.

The competent authorities in Cyprus are taking all necessary actions to suspend public access to the UBO Register.