The Cypriot government has decided to cancel all fines imposed on employees of local businesses for the late submission of beneficial ownership data. This announcement was made on October 8 by Irini Milona Chrysostomou, head of the Department of Company Registration in Cyprus.
The Parliamentary Committee on Commerce recently held a meeting to review and revise the penalties for non-compliance. As a result, the fines will no longer be imposed on individuals but rather on the organizations as a whole. Additionally, the maximum fine has been capped at €250. Chrysostomou reported that the department had already recovered a total of €14 million from local companies, of which €600,000 had been returned to the businesses that initially paid the fines.
It is important to note that Cypriot businesses were required to submit information about their final beneficiaries to the register by December 31, 2023. However, due to technical difficulties with the Ministry’s website, around 200 companies were unable to complete the necessary forms, which led to fines. In some instances, these penalties reached as high as €80,000, causing widespread dissatisfaction among the business community.
Entrepreneurs, through their representative bodies, expressed their frustrations to Chrysostomou, citing that the rollout of the decree on January 1, 2024, caused a significant number of problems. These issues included disproportionately high fines, difficulties scheduling appointments at citizen service centers, and technical glitches on the registrar’s website, which made it impossible for many to meet the agency’s demands. In response, Chrysostomou agreed to extend the registration period and to reconsider the penalty structure entirely.
Refunds for Fines
To resolve these complaints, the Department of Company Registration and Intellectual Property decided to extend the registration deadline to March 31, 2023. Additionally, since some businesses had already been fined and paid those fines, the government moved forward with refunding the amounts collected.
The electronic Register of Ultimate Beneficial Owners (UBOs), which records the individuals who ultimately own or control a company, was introduced in Cyprus on January 1, 2022. Despite its initial rollout, the system faced several technical setbacks, resulting in the inability of many businesses to submit the required data by the December 2023 deadline.
The platform was developed by a private company that won a public tender, with funding from the EU’s Cyprus Recovery and Development Programme. The digital portal continues to be regularly tested to ensure its functionality, and businesses are required to report the ownership of 25% or more of their shares, either directly or indirectly.
This initiative marks a significant step in Cyprus’ efforts to enhance transparency and compliance in business operations. However, the complications faced during the launch have highlighted the need for smoother digital transitions and better support for local businesses.
Source: stockwatch.com.cy,