EU: Any way to have no UBO or avoid its publication?

[Macy]

Hi forum members. Here's my situation:
- I am a citizen of the EU; I do not reside in the EU.
- I need to create a company in the EU. It does not need to be a subsidiary of my foreign company, but it can be. It should not be a branch.
- I do not particularly care what EU country it will be in, its taxation, etc.

I will hire a real director based in the country who will be conducting the management and will be listed there. Now, the main problem - what/who will be the shareholder?

If I just use my generic foreign company, I will have to disclose myself as the UBO publicly because I own 100% of it. I want to avoid this. I know that, for now, Cyprus doesn't yet publish the UBO but the public register is meant to be live by the end of the year so this solution would be way too temporary. I also completely exclude the use of darks or misdisclosure.

I want to see if there is any structure I can use where either the UBO is not published, or where the company effectively has no UBO. What I mean with the latter is if there is any option like a trust or foundation as the owner. I don't need to withdraw any money from the company and despite its turnover the company will be spending most of its funds and does not plan to have much profits or dividend distribution. So I was thinking if there can be some kind of association which really has no owner and that will own the company.

Does anybody have an idea or suggestion? I guess that some of the options might make banking a mess too.

Thanks

 

[12345]

EU company is owned by USA LLC registered in Delaware or Wyoming (no public register of shareholders) - maybe that would work for you?

 

[Macy]

12345 said:
EU company is owned by USA LLC registered in Delaware or Wyoming (no public register of shareholders) - maybe that would work for you?
Click to expand...

I already have US LLCs for other purposes - for example BOI is completely fine for me. I don't have a problem with the gov getting this info but I don't want them to publish it.

E.g. if I put the US LLC as the shareholder in a Sp. z o.o. - I will have to report myself to the Centralny Rejestr Beneficjentów Rzeczywistych anyway, and then I will be listed anywhere publicly as the UBO. The US LLC doesn't provide anonimity in the case because the Polish government will require my info anyway and it will publish it for everyone - also on sites like Aleo, Rejestrio, etc.

 

[12345]

Macy said:
I already have US LLCs for other purposes - for example BOI is completely fine for me. I don't have a problem with the gov getting this info but I don't want them to publish it.

E.g. if I put the US LLC as the shareholder in a Sp. z o.o. - I will have to report myself to the Centralny Rejestr Beneficjentów Rzeczywistych anyway, and then I will be listed anywhere publicly as the UBO. The US LLC doesn't provide anonimity in the case because the Polish government will require my info anyway and it will publish it for everyone - also on sites like Aleo, Rejestrio, etc.
Click to expand...

Yes in that case the government of Poland will know the UBO but it will be not publicly listed I am 100% certein. You can can check some random companies and its just the LLC name listed publicly

 

[ilke]

12345 said:
Yes in that case the government of Poland will know the UBO but it will be not publicly listed I am 100% certein. You can can check some random companies and its just the LLC name listed publicly
Click to expand...

This isn't correct.

You can easily see the UBO on the Polish government site on the Wyszukiwarka CRBR. The register sites like Rejestr.io will also import this data through the API and publish the address, directors, shareholders, and CRBR information.

 

[12345]

ah ok I were not aware of Wyszukiwarka CRBR. sites like rejestr.io don't publish UBO. Just shareholders. So they would publish LLC name

so I think no country in EU is possible without sharing UBO.

 

[AlexPCS]

Macy said:
Hi forum members. Here's my situation:
- I am a citizen of the EU; I do not reside in the EU.
- I need to create a company in the EU. It does not need to be a subsidiary of my foreign company, but it can be. It should not be a branch.
- I do not particularly care what EU country it will be in, its taxation, etc.

I will hire a real director based in the country who will be conducting the management and will be listed there. Now, the main problem - what/who will be the shareholder?

If I just use my generic foreign company, I will have to disclose myself as the UBO publicly because I own 100% of it. I want to avoid this. I know that, for now, Cyprus doesn't yet publish the UBO but the public register is meant to be live by the end of the year so this solution would be way too temporary. I also completely exclude the use of darks or misdisclosure.

I want to see if there is any structure I can use where either the UBO is not published, or where the company effectively has no UBO. What I mean with the latter is if there is any option like a trust or foundation as the owner. I don't need to withdraw any money from the company and despite its turnover the company will be spending most of its funds and does not plan to have much profits or dividend distribution. So I was thinking if there can be some kind of association which really has no owner and that will own the company.

Does anybody have an idea or suggestion? I guess that some of the options might make banking a mess too.

Thanks
Click to expand...

Hello. Have you ever considered using a nominee service for this purpose?

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[PhantomOf ThePits]

12345 said:
ah ok I were not aware of Wyszukiwarka CRBR. sites like rejestr.io don't publish UBO. Just shareholders. So they would publish LLC name

so I think no country in EU is possible without sharing UBO.
Click to expand...

https://commission.europa.eu/about-...nciples/transparency/transparency-register_en
EU wide Transparency register (sooner or later in all member states)

Also DAC6
https://kpmg.com/ch/en/insights/taxes/eu-mandatory-disclosure-rules-dac6.html

 

[Macy]

AlexPCS said:
Hello. Have you ever considered using a nominee service for this purpose?
Click to expand...

I have - but I do not see how it would necessarily help, because the nominee does not hide the UBO. If the UBO is misrepresented, it's just a large violation of national laws.

PhantomOf ThePits said:
https://commission.europa.eu/about-...nciples/transparency/transparency-register_en
EU wide Transparency register (sooner or later in all member states)

Also DAC6
https://kpmg.com/ch/en/insights/taxes/eu-mandatory-disclosure-rules-dac6.html
Click to expand...

Yes, this is the problem - that's why I am exploring if there is any option for a structure which theoretically won't have an owner (like a foundation or NPA as the shareholder) and will not distribute dividends because I don't need to do so.

 

[Don]

Macy said:
Hi forum members. Here's my situation:
- I am a citizen of the EU; I do not reside in the EU.
- I need to create a company in the EU. It does not need to be a subsidiary of my foreign company, but it can be. It should not be a branch.
- I do not particularly care what EU country it will be in, its taxation, etc.

I will hire a real director based in the country who will be conducting the management and will be listed there. Now, the main problem - what/who will be the shareholder?

If I just use my generic foreign company, I will have to disclose myself as the UBO publicly because I own 100% of it. I want to avoid this. I know that, for now, Cyprus doesn't yet publish the UBO but the public register is meant to be live by the end of the year so this solution would be way too temporary. I also completely exclude the use of darks or misdisclosure.

I want to see if there is any structure I can use where either the UBO is not published, or where the company effectively has no UBO. What I mean with the latter is if there is any option like a trust or foundation as the owner. I don't need to withdraw any money from the company and despite its turnover the company will be spending most of its funds and does not plan to have much profits or dividend distribution. So I was thinking if there can be some kind of association which really has no owner and that will own the company.

Does anybody have an idea or suggestion? I guess that some of the options might make banking a mess too.

Thanks
Click to expand...

Yes, it is possible.

Non-profit association or co-operatives often disclose director as UBO, but members (owners) might not be public.
Such entity could be used as a holding structure, and in tax planning.

 

[dirtyharry]

AlexPCS said:
Hello. Have you ever considered using a nominee service for this purpose?
Click to expand...

In the EU this is indeed the only way you can avoid it unless you go with a fund or foundation setup which was heavily discussed in the mentor group
https://www.offshorecorptalk.com/th...t-protection-tool-everyones-overlooking.46062
It is very difficult to hide you unless you have lots of money and making lots of money with your business.

 

[Sols]

If you have enough shareholders, the director may end up being the UBO. This only works if the shareholders aren't in the end owned by the same few persons or one person. In that case, you're of course supposed to sum up the ownership per UBO and see who passes the threshold.

If you set up a foundation, the chairperson of the council may end up being the UBO. Foundations can be both complicated and expensive, and can make opening a bank account for the company nearly impossible. Only do this if you're working with a well connected expert that can help you sort out banking, or if you don't need banking.

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This is the probably the answer to your question.

 

[Macy]

Don said:
Yes, it is possible.

Non-profit association or co-operatives often disclose director as UBO, but members (owners) might not be public.
Such entity could be used as a holding structure, and in tax planning.
Click to expand...

So if I hired a director to manage the non-profit association, which would act as a shareholder for the EU company, it could be that this individual is disclosed.

Do you have any recommendations for the jurisdiction?

Sols said:
If you have enough shareholders, the director may end up being the UBO. This only works if the shareholders aren't in the end owned by the same few persons or one person. In that case, you're of course supposed to sum up the ownership per UBO and see who passes the threshold.

If you set up a foundation, the chairperson of the council may end up being the UBO. Foundations can be both complicated and expensive, and can make opening a bank account for the company nearly impossible. Only do this if you're working with a well connected expert that can help you sort out banking, or if you don't need banking.
Click to expand...

Understood, thank you for the heads up.

Then I guess I won't really have many options other than disclosing myself as the UBO. It doesn't even make sense to bring corporate shareholders in much because I would be published one way or another.

I formulated a further question though: Is there an EU country where the UBO details will be public, but have to be paid for? Say, in Poland, as I used for the first example, it's freely accessible with their UBO search engine. But I know some countries require payment to see corporate documents - so do any have the same for UBO (and which are the most expensive)?

 

[Simon4466]

Most EU countries dont allow the public to see the UBO register at the moment due to an ongoing court case in Luxembourg from a Dutch privacy organization. At least in NL it is not possible to see it as a regular citizen at the moment (and with that I believe most EU countries).

 

[JohnLocke]

It's very simple, as long as you can find the detailed company details in the below link you know that your information will be all public:
https://opencorporates.com/
I run a few tests on 3 different EU countries where I can find the owners quickly. So I believe it is more a standard than an exception.

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[daniels27]

Then do it like the pros. Hire Rapid Corporate Services, let them provide directors and share holders. Then you can sit back and relax.. You could even keep owning 1 preferential share with all dividend rights.

But it seems that Swiss AG would work, the shareholders are not disclosed.

Last edited: Sep 20, 2024

 

[mraleph]

daniels27 said:
But it seems that Swiss AG would work, the shareholders are not disclosed.
Click to expand...

Shareholders won't be disclosed in commercial registry but UBOs may have to be disclosed. Though, the UBO registrar may be introduced from 2025 it will be similar to US one - not available to general public. So, a Swiss solutions though expensive may still be more prefered then others when it comes to certain degree of privacy.

@Macy, for EU member country, Austria's commercial registry may fit your requirements.

Last edited: Sep 20, 2024

 

[Fraction]

Macy said:
I already have US LLCs for other purposes - for example BOI is completely fine for me. I don't have a problem with the gov getting this info but I don't want them to publish it.

E.g. if I put the US LLC as the shareholder in a Sp. z o.o. - I will have to report myself to the Centralny Rejestr Beneficjentów Rzeczywistych anyway, and then I will be listed anywhere publicly as the UBO. The US LLC doesn't provide anonimity in the case because the Polish government will require my info anyway and it will publish it for everyone - also on sites like Aleo, Rejestrio, etc.
Click to expand...

Open a branch of US LLC in Poland like I did or use two LLC's to open limited partnership (spóÅ‚ka komandytowa) with US nominee service.

 

[dirtyharry]

Sols said:
If you set up a foundation, the chairperson of the council may end up being the UBO. Foundations can be both complicated and expensive, and can make opening a bank account for the company nearly impossible. Only do this if you're working with a well connected expert that can help you sort out banking, or if you don't need banking.
Click to expand...

this is something many may have overlooked when they consider to setup a foundation!

 

[Alex Braun]

Nominee Service is the solution in your case.
Public registers are all over the EU and getting worse.
Why you don't care about the taxation regime? Corp tax 25% and 9% is a big difference, 8% VAT vs. 27% VAT also big.
Would you mind sharing more details of your business nature with us?