Section 3(7) of the ASP Law requires trustees and service providers who fall within its scope to identify and verify the main stakeholders in trusts governed by Cyprus law that they establish or administer. They must keep accurate and up-to-date information and documentation regarding the trustee, settlor, beneficiaries or class of beneficiaries, any protector, fund manager, accountant, tax consultant, and any other person exercising effective control over the trust, and on the activities of the trust.
Law 109(I)/2013, which entered into force on September 9 2013 (the amending law) introduces detailed provisions regarding the establishment of registers of trusts. Service providers are required to notify their respective competent authority of the following information:
- The name of the trust
- The name of the trustee at all relevant times
- The date of creation of the trust
- The date of any change in the law governing the trust
- The date of termination of the trust
For trusts established after the amending law entered into force, this information must be submitted to the competent authority within 15 days of the establishment of the trust or the adoption of Cyprus law as the law governing the trust. Information on existing trusts governed by Cyprus law when the amending law entered into force must be submitted to the relevant competent authority no later than March 9 2014.
Subsequent changes to any relevant information, including termination of the trust or a change in the governing law from Cyprus law, must be notified within 15 days. In the event of termination of the trust or a change in the governing law from Cyprus law, the register will indicate that the trust has been terminated and the information on the trust will be kept for five years.
Failure to comply with these provisions is a criminal offence punishable on conviction by imprisonment for up to five years, a fine of up to €350,000 ($472,500), or both.
It is important to note that the trust registers to be maintained by each competent authority are not publicly available or accessible, and will only be available for inspection by other competent authorities.
A fee of €30 will be payable for the notification of the details of each trust with the respective competent authority. Trusts will be registered only once the registration fee has been paid. A fee of €20 will be payable in respect of subsequent amendments. The authorities are also exploring the option of electronic filing in order to streamline the process.
This development underscores Cyprus's commitment to the highest standards of transparency in combating money laundering.