Hungary

What is the legal basis of the Transparency Register in the respective Member State?

Act LIII of 2017 on the Prevention and Combating of Money Laundering and Terrorist Financing (2017. évi LIII. törvény a pénzmosás és a terrorizmus finanszírozása megelőzéséről és megakadályozásáról).

Is there an obligation of a UBO or shareholder to proactively provide information on the UBO to the legal entity?

Pursuant to the Act LIII of 2017, legal entities are not required to directly submit information to a central register regarding their UBO. However, in the event such entities are to engage in a business relationship with certain service providers (eg. financial institutions, insurances, auditing firms etc.) they will be required in certain cases to provide certain information to the service providers in accordance with the Act LIII of 2017 as part of the service providers’ customer due diligence. Such due diligence will include customer identification and verification procedures, including the identification and verification of the customer’s agent, proxy or other authorized representative. In the framework of the customer due diligence, customers are required to provide information regarding their UBOs as well. The collected and recorded data on the UBOs of customers (legal persons, unincorporated organizations and fiduciary managers) will then be forwarded to the central register by the service provider (details of which are to be regulated in a separate Act that has yet to be adopted), provided such data is not already recorded in the central register.

Is there an obligation of a legal entity to actively inquire with its shareholders/partners on the identity of the UBO(s)?

Pursuant to the Act LIII of 2017, legal entities are not required to directly submit information to a central register regarding their UBO. However, in the event such entities are to engage in a business relationship with certain service providers (eg. financial institutions, insurances, auditing firms etc.) they will be required in certain cases to provide certain information to the service providers in accordance with the Act LIII of 2017 as part of the service providers’ customer due diligence. Such due diligence will include customer identification and verification procedures, including the identification and verification of the customer’s agent, proxy or other authorized representative. In the framework of the customer due diligence, customers are required to provide information regarding their UBOs as well. The collected and recorded data on the UBOs of customers (legal persons, unincorporated organizations and fiduciary managers) will then be forwarded to the central register by the service provider (details of which are to be regulated in a separate Act that has yet to be adopted), provided such data is not already recorded in the central register.

Who is required to make filings with the Transparency Register, the legal entity or the UBO?

Pursuant to the Act LIII of 2017, legal entities are not required to directly submit information to a central register regarding their UBO. However, in the event such entities are to engage in a business relationship with certain service providers (eg. financial institutions, insurances, auditing firms etc.) they will be required in certain cases to provide certain information to the service providers in accordance with the Act LIII of 2017 as part of the service providers’ customer due diligence. Such due diligence will include customer identification and verification procedures, including the identification and verification of the customer’s agent, proxy or other authorized representative. In the framework of the customer due diligence, customers are required to provide information regarding their UBOs as well. The collected and recorded data on the UBOs of customers (legal persons, unincorporated organizations and fiduciary managers) will then be forwarded to the central register by the service provider (details of which are to be regulated in a separate Act that has yet to be adopted), provided such data is not already recorded in the central register.

Are there exemptions to the filing obligation?

Pursuant to the Act LIII of 2017, legal entities are not required to directly submit information to a central register regarding their UBO. However, in the event such entities are to engage in a business relationship with certain service providers (eg. financial institutions, insurances, auditing firms etc.) they will be required in certain cases to provide certain information to the service providers in accordance with the Act LIII of 2017 as part of the service providers’ customer due diligence. Such due diligence will include customer identification and verification procedures, including the identification and verification of the customer’s agent, proxy or other authorized representative. In the framework of the customer due diligence, customers are required to provide information regarding their UBOs as well. The collected and recorded data on the UBOs of customers (legal persons, unincorporated organizations and fiduciary managers) will then be forwarded to the central register by the service provider (details of which are to be regulated in a separate Act that has yet to be adopted), provided such data is not already recorded in the central register.

What is the due date for the initial filing with the Transparency Register?

Pursuant to the Act LIII of 2017, legal entities are not required to directly submit information to a central register regarding their UBO. However, in the event such entities are to engage in a business relationship with certain service providers (eg. financial institutions, insurances, auditing firms etc.) they will be required in certain cases to provide certain information to the service providers in accordance with the Act LIII of 2017 as part of the service providers’ customer due diligence. Such due diligence will include customer identification and verification procedures, including the identification and verification of the customer’s agent, proxy or other authorized representative. In the framework of the customer due diligence, customers are required to provide information regarding their UBOs as well. The collected and recorded data on the UBOs of customers (legal persons, unincorporated organizations and fiduciary managers) will then be forwarded to the central register by the service provider (details of which are to be regulated in a separate Act that has yet to be adopted), provided such data is not already recorded in the central register.

What are the sanctions in case of a breach of the transparency obligation?

Service providers must refuse to carry out transactions following 26 June 2019 if no information is available.

Is the Transparency Register established as a separate register or part of an existing register?

n/a