The European Court of Justice, has decided on the 22 November 2022, that open public access to the beneficial owner registers of EU Member States is no longer valid, as it is in contravention of articles of the Charter of Fundamental Rights of the European Union . This decision directly impacts the beneficial ownership register we have in Cyprus. We are waiting for more information from the Cyprus Registrar of Companies as the situation unravels.
During 2018 an Anti Money Laundering Directive made it compulsory to EU Member states to make the beneficial owner registers fully accessible to the Public. Decision today, amongst others stated that giving public free access to such a registry creates a serious interference with the fundamental rights to private life and to protection of personal data.
Please read the official press release from the European Court of Justice below:
Judgment of the Court in Joined Cases C-37/20 | Luxembourg Business Registers and C-601/20 | Sovim
Anti-money-laundering directive: the provision whereby the information on the beneficial ownership of companies incorporated within the territory of the Member States is accessible in all cases to any member of the general public is invalid
The interference with the rights guaranteed by the Charter entailed by that measure is neither limited to what
is strictly necessary nor proportionate to the objective pursued
In accordance with the anti-money-laundering directive, 1 a Luxembourg law adopted in 2019 2 established a Register of Beneficial Ownership and provides that a whole series of information on the beneficial owners of
registered entities must be entered and retained in that register. Some of that information is accessible to the
general public, in particular through the Internet. That law also provides that a beneficial owner may request
Luxembourg Business Registers (LBR), the administrator of the Register, to restrict access to such information in
In that context, the tribunal d’arrondissement de Luxembourg (Luxembourg District Court, Luxembourg) was seised
of two actions, brought by a Luxembourgish company and by the beneficial owner of such a company, respectively,
which had previously unsuccessfully requested LBR to restrict the general public’s access to information concerning
them. Since that court considered that the disclosure of such information is capable of entailing a disproportionate
risk of interference with the fundamental rights of the beneficial owners concerned, it referred a series of questions
to the Court of Justice for a preliminary ruling concerning the interpretation of certain provisions of the anti-moneylaundering directive and the validity of those provisions in the light of the Charter of Fundamental Rights of the European Union (‘the Charter’).
In today’s judgment, the Court, sitting as the Grand Chamber, holds that, in the light of the Charter, the provision of
the anti-money-laundering directive whereby Member States must ensure that the information on the beneficial
ownership of corporate and other legal entities incorporated within their territory is accessible in all cases to any
member of the general public is invalid.
According to the Court, 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, enshrined in Articles 7 and 8 of the Charter, respectively. Indeed, 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 can not only
be freely consulted, but also retained and disseminated.
That said, the Court finds that, by the measure at issue, the EU legislature seeks to prevent money laundering and
terrorist financing by creating, by means of increased transparency, an environment less likely to be used for those
purposes. It holds that the legislature thereby pursues an objective of general interest capable of justifying even
serious interferences with the fundamental rights enshrined in Articles 7 and 8 of the Charter, and that the general
public’s access to information on beneficial ownership is appropriate for contributing to the attainment of that
The Court holds, however, that the interference entailed by that measure is neither limited to what is strictly
necessary nor proportionate to the objective pursued. In addition to the fact that the provisions at issue allow
for data to be made available to the public which are not sufficiently defined and identifiable, the regime introduced
by the anti-money-laundering directive amounts to a considerably more serious interference with the
fundamental rights guaranteed in Articles 7 and 8 of the Charter than the former regime (which provided, as well as
access by the competent authorities and certain entities, for access by any person or organisation capable of
demonstrating a legitimate interest), without that increased interference being capable of being offset by any
benefits which might result from the new regime as compared against the former regime, in terms of combating
money laundering and terrorist financing. In particular, the fact that it may be difficult to provide a detailed
definition of the circumstances and conditions under which such a legitimate interest exists, relied upon by the
Commission, is no reason for the EU legislature to provide for the general public to access the information in
question. The Court adds that the optional provisions which allow Member States to make information on
beneficial ownership available on condition of online registration and to provide, in exceptional circumstances,
for an exemption from access to that information by the general public, respectively, are not, in themselves,
capable of demonstrating either a proper balance between the objective of general interest pursued and the
fundamental rights enshrined in Articles 7 and 8 of the Charter, or the existence of sufficient safeguards enabling
data subjects to protect their personal data effectively against the risks of abuse.
Above you could read the official press release from the European Court of Justice, which can also be found here. We will release more information as this becomes available.