Spain’s New Ownership Registry: Promoting Transparency

In a monumental push toward enhanced financial transparency, Spain introduced a pioneering regulation on July 11, 2023—Royal Decree 609/2023. This legislation, set to take effect on September 19, 2023, marks the creation of the Central Registry of Real Property Ownership (CRBO). This blog delves into the specifics of the CRBO, its significant advantages over existing systems, and its operational nuances, emphasizing why this initiative is not just another regulatory formality but a substantial step towards mitigating financial crimes in Spain and aligning with European Union directives.

A New Framework for Financial Transparency

The CRBO emerges against the backdrop of existing beneficial ownership registers in Spain—one managed by the General Council of Notaries and another by the Commercial Registry. Each plays a crucial role in collecting and maintaining data on beneficial owners as disclosed by legal entities annually or during notarial activities. However, the CRBO integrates these into a more robust, centrally managed registry under the Ministry of Justice. This centralization aims to streamline access and improve the coherence of beneficial ownership data across Spain.

What Makes CRBO Stand Out?

Unlike the previous fragmented systems, the CRBO serves as a central repository connected to other EU Member States’ central registers. This integration facilitates a more seamless and transparent view of beneficial ownership data, significantly bolstering Spain’s efforts against money laundering and the financing of terrorism.

Detailed Data Collection

The CRBO is designed to house detailed information including:

• Personal Information: Full names, dates of birth, nationalities, and residencies of beneficial owners.
• Identification Numbers: ID or passport numbers along with the country of issuance.
• Ownership Specifics: Details on the percentage of shares or voting rights held, including both direct and indirect ownership.
• Contact Details: Email addresses of beneficial owners for notification and verification purposes.

This information depth enhances the reliability and utility of the registry, ensuring that entities and regulatory bodies can access up-to-date and accurate data.

Operational Excellence

The registry mandates daily data uploads from other registries to ensure the CRBO remains current. A significant first data transfer will occur no later than nine months after the regulation comes into effect, ensuring that the registry starts on a strong footing.

Who Needs to Report?

All entities, particularly those not previously required to declare their beneficial ownership in any registry, must now submit their details to the CRBO. This includes detailed declarations of beneficial ownership upon the launch of the CRBO and subsequent updates either annually or upon any changes in beneficial ownership.

Handling Discrepancies

In cases of discrepancies between the CRBO and information from other registries, the CRBO will prompt the origin registry to verify or update the information within ten days. This mechanism ensures that the most reliable and recent information is prioritized.

Accessing the CRBO

A broad spectrum of entities, including Spanish and EU authorities responsible for AML/CFT, notaries, registrars, and obliged entities under Law 10/2010, have direct access to this data. Furthermore, other parties demonstrating a legitimate interest—such as media and civil society organizations focusing on AML/CFT—can also access the information.

Implications of Non-Compliance

Entities that fail to ensure their information in the CRBO is correct and current face significant consequences. These range from being barred from making any new registrations in the Commercial Registry to potential sanctions as stipulated by the Ministry of Justice.

Conclusion

The establishment of the CRBO is a transformative step for Spain, enhancing transparency, regulatory compliance, and investor confidence. By centralizing and standardizing the access to beneficial ownership information, Spain not only fortifies its financial system against illicit activities but also aligns itself more closely with EU regulatory standards. This initiative underscores Spain’s commitment to leading by example in the global fight against financial crimes.

For professionals engaged in financial, legal, or property transactions in Spain, understanding and utilizing the CRBO will be pivotal. Stay in touch for more updates and insights as this significant regulatory development unfolds.

For further insights and assistance in aligning your business with the regulatory requirements worldwide, discover how Klea can support you in this endeavor. Explore how our expertise can complement your compliance strategies and propel your business forward in an era of transparency. To begin, read our blog post on Revealing The UK’s Economic Crime & Transparency Act: A Thrilling Exploration.