On 6 December 2024, Cyprus amended its Prevention and Suppression of Money Laundering Activities Law (AML Law), introducing significant changes to the regulation and enforcement of Ultimate Beneficial Ownership (UBO) data. These reforms aim to simplify compliance, reduce administrative burdens, and enhance oversight.

Key Changes

1. Adjusted Penalty Structure

The updated penalty system introduces a more balanced approach to fines:

• Initial Penalty: EUR 100 for the first day of non-compliance.
• Daily Increment: EUR 50 per day thereafter.
• Maximum Fines:
  • Corporate Entities and Trusts: Capped at EUR 5,000.
  • Associations and Foundations: Capped at EUR 2,000.

This revised structure addresses concerns over disproportionate penalties while encouraging timely compliance.

2. Unified Liability Framework

The amendments streamline liability for UBO reporting failures:

• Entity Liability: A single fine is imposed on the entity.
• Joint Responsibility: Company officers share responsibility for paying fines without facing individual penalties.
• Exclusion of Company Secretaries: Secretaries are no longer liable, aligning enforcement with decision-making roles.

3. Enhanced Enforcement Powers

The Registrar of Companies now has additional tools to ensure compliance:

• Court Orders: The authority to petition courts to compel compliance.
• Administrative Strike-Off: Persistent non-compliance may lead to the removal of entities from the registry.

Procedural Updates and Appeals

The Registrar will issue updated directives, including:

• New Reporting Guidelines to reflect legislative changes.
• Appeals Framework allowing entities to challenge fines or actions.

Next Steps for Businesses

To ensure compliance, organisations should:

• Review and update their UBO reporting practices.
• Monitor the Registrar’s directives for changes.
• Align internal processes with the new penalty and liability provisions.

These amendments demonstrate Cyprus’ commitment to fostering a transparent and equitable regulatory environment while strengthening AML enforcement.

How We Can Assist

Navigating the updated AML framework can be challenging. Our experienced lawyers are ready to help you with:

• Compliance Evaluation: Assessing your organisation’s current status.
• UBO Reporting: Preparing accurate and timely submissions.
• Legal Representation: Advocating for your interests in appeals or enforcement proceedings.

Contact us today to ensure your organisation stays compliant and well-prepared under the revised AML regime.