The controversial unique additional provision of the Law on the prevention of money laundering and the financing of terrorism, established (through the Royal Decree Law 11/2018) the obligation for individuals and legal entities that provide the following professional services on behalf of third parties to register in the Service Providers Register:
- Set up companies and other legal entities;
- Carry out the duties of management or non-board member secretaries of boards of directors or external consultants of a company, a member of an association or similar tasks associated with other legal entities;
- Provide a registered office or business address, mailing address, administrative address and other similar services to a company, an association or any other instrument or legal entity;
- Carry out the tasks of a trustee in a trust or a similar legal instrument;
- Carry out the tasks of a shareholder on behalf of someone else (except for companies that are listed on a regulated market of the European Union and are subject to the data requirements pursuant to the Law of the European Union or similar international regulations that guarantee the appropriate transparency of the information about the property).
Pursuant to the aforesaid regulation, individuals can only register online by filling in a pre-established form that would be approved according to the applicable Ministerial Order.
Moreover, the Ministry of Justice was authorised to give orders, instructions or make decisions deemed necessary to implement the obligation established in the aforesaid additional provision through the Directorate General of Registries and Notaries.
The approval and the publication of the regulation has been affected in Spain by the political deadlock and with regard to the case in question, no decision has been made that would provide interpretive criteria on this obligation. This deadlock has even affected the registration deadlines, which were different for individuals and legal entities and they were even extended. The corresponding deadlines to register were different: for legal entities, the 4th of September last year and for individuals, the 31st of December.
In the absence of more arguments, the interpretive guide of the Commission for the Prevention of Money Laundering and Monetary Offices will presumably be used as a basis to evaluate this registration and the possible penalties in cases where it is deemed appropriate.
Therefore, pursuant to this guide the following conclusion can be drawn:
- The services have to be provided on behalf of third parties(that is to say, there must be a lack of involvement). In this sense, any services that are not rendered within the context of non-involvement shall not be subject to the obligation to register.
- The services provided must be professional, that is to say they are provided under the circumstances of regularity, with remuneration and independence from the beneficiary of the service.
- Setting up companies and other legal entities does not include the duties of giving advice, instead it involves directly setting up the companies in a different name other than that of the real owner (that means to say that it is set up by way of interposition). The provision of technical consultancy services would not be subject to the obligation to register.
- With regard to the duties of management or non-board member secretaries, a distinction between the duties of representation and the simple implementation of acts will have to be made, along with those of management and effective decision making in the company. Accordingly, it must be pointed out that the business or professional reports about the activity are also required (regularity, remuneration and independence), which are written on behalf of third parties (that there is no involvement). Therefore, consideration should be given to the fact that if the report about the professional/business activity is written, and on behalf of third parties, when it comes to parties that are interrelated the report about the non-involvement of the service provider with regard to the beneficiary entity would not be supplied, as required by the interpretive guide of the Commission on the Prevention of Money Laundering.
- With regard to professional firms, individual professionals are exempt from the obligation to register, seeing as they are understood to be included in the professional firm. If the aforesaid circumstances apply to the professional firm, it would have to register.
Notwithstanding the aforementioned, as the conclusions are drawn from a guide that is merely interpretive, the criteria established might change, and other different criteria might be established in the end, or what actually exists at present that still raises doubts, might be clarified.