Disclosure Requirements - Investment Funds - Estonia
Disclosure Category: 2
Clearstream Banking S.A (“CBL”) may be required, under Estonian Law, to disclose, upon request, in the case of holding Estonian investment funds.
In order to comply with the local legislation, customers with holdings in Estonian investment funds or entering into transactions in the Estonian market must consent and are hereby deemed to consent to the required legal disclosure. Such consent includes the appointment of the requestor (for example, the Fund Manager, Transfer Agent, Regulator) as their attorney-in-fact, under power of attorney, to collect from CBL the required information to be disclosed. Customers who do not grant such authority cannot hold such investment funds or financial instruments in their accounts with CBL.
Pursuant to the Estonian Money Laundering and Terrorist Financing Prevention Act, the fund manager or investment fund founded as a public limited company is required to perform AML/KYC checks. Pursuant to the EU Fourth Anti-Money Laundering Directive 2015/849, all corporate and other private legal entities (that is, public limited fund or limited partnership fund) incorporated within the Republic of Estonia must also take reasonable steps to identify their ultimate beneficial owners and are entitled to request information from shareholders or members. Therefore, when requested, CBL must submit the information to the relevant parties.
Background and legal basis
In the case of holding Estonian investment funds, CBL is obliged under the following legislation to disclose the identity and holdings of customers, third parties and/or ultimate beneficial owners.
- Estonian Money Laundering and Terrorist Financing Prevention Act
- EU Fourth Anti-Money Laundering Directive 2015/849
- Estonian Securities Register Maintenance Act
Subject to changes in Estonian law, sanctions and other consequences may be applied to for non-compliance. Consequences for non-compliance with such requests for CBL or CBL customers could be up to EUR 1,200 penalty for a shareholder or member of private legal person for not submitting the data of the beneficial owner or failure to report on a change of the data or for knowingly submitting false data and the obliged entity cannot take due diligence measures because of it. There is a penalty of EUR 32,000 for the same act committed by a legal person.
The information contained in the Disclosure Requirements is based on the legal opinion obtained by CBL that was issued on 24 January 2019. CBL believes the information to be correct as of that date but disclaims any responsibility as to the accuracy and completeness of the information after that date. In the case of discrepancy between the information provided by CBL and the local laws and regulations, the latter shall prevail. The Disclosure Requirements do not constitute legal advice and customers should seek advice from independent professional counsel.
Customers are responsible for ensuring compliance with the disclosure requirements and agree to indemnify and hold harmless CBL, for any loss, expense, liability, damage or claims, whether direct or indirect, against or incurred by CBL arising out of or resulting from such non-compliance.