Disclosure Requirements - Investment Funds - Ireland
Disclosure Category: 1
Clearstream Banking S.A. (“CBL”) may fall under an obligation to disclose the identity and holdings of customers and/or ultimate beneficial owners in the case of holding Irish investment funds.
In order to comply with the local legislation, customers with holdings in Irish investment funds or entering into transactions in the Irish 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.
Customers are advised that the local laws and regulations oblige CBL to disclose the requested information on CBL customers and/or ultimate beneficial owners to the party that is entitled by law to receive such information.
Under Irish law, the investment fund, or a delegate on its behalf, is also required to verify the investors identity. They must monitor and collect AML documents on customers and applicants, including any ultimate beneficial owners. CBL, as a nominee investor, is obliged to provide this information, if requested.
Background and legal basis
In the case of holding Irish investment fund units or shares, CBL is obliged under the following legislation to disclose the identity and holdings of customers and/or ultimate beneficial owners:
- European Union (Anti-Money Laundering: Beneficial Ownership and Corporate Entities) Regulation 2016;
- The Criminal Justice (Money Laundering and Terrorist Financing) Act 2010;
- Taxes Consolidation Act 1997;
- Transparency (Directive 2004/109/EC) (Amendment) (No.2) Regulation 2015.
CBL as an intermediary is obliged under certain condition to disclose to the Irish Revenue Commissioners the identity of beneficial owners.
Failure to comply with the disclosure request from the regulators/authorities within the stipulated time frame may result in suspension of the business relation with the customer until the requested information is fully and accurately disclosed. Non-compliant customers will either not be permitted to receive any subscription/redemption proceeds or will be subjected to exit tax charges until they are fully compliant.
Obligation to report threshold crossings
“Transparency Regulations” obliges a person holding voting shares to disclose the acquisition and disposal of shares. Disclosure is required when the person’s voting rights exceed, fall below or reach a threshold of 3%, 5%, 10%, 15%, 20%, 25%, 30%, 50%, or 75% of the total amount of voting rights issued. The regulation will only be applicable to shares that are traded on a regulated market. Investment funds that are unlisted will not be subject to this reporting requirement.
The information contained in the Disclosure Requirements is based on the legal opinion obtained by CBL that was issued on 27 February 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.