In accordance with the Anti-Money Laundering Directive, Luxembourg adopted a law establishing a register of beneficial owners (which included information on these persons). Some of the information in the register is accessible to the general public via the internet but interested persons can request restricted access under certain conditions.
In this context, a Luxembourg entity and a person who is a beneficial owner have referred the matter to the Luxembourg courts, claiming that the disclosure of this information infringes the fundamental rights of the beneficial owners concerned and is disproportionate. The court referred the matter to the Court of Justice of the European Union (CJEU) asking it to rule on the validity of the provisions of the Anti-Money Laundering Directive in the light of the Charter of Fundamental Rights of the European Union (Charter).
The CJEU (Joined Cases C-37/20 and C-601/20) held that the provisions of the Directive requiring Member States to ensure that information on beneficial owners is accessible in all cases to any member of the general public are contrary to the Charter. The Court held that the information disclosed enables a potentially unlimited number of persons to inform themselves about the material and financial situation of a beneficial owner.
Although the Court accepts that certain objectives of general interest (such as preventing money laundering and combating terrorism) would justify interference (even serious interference in some cases), it is noted that the previous regime, which provided for access not only to the competent authorities and certain entities, but also to any person or organisation that can demonstrate a legitimate interest, is preferable.
Therefore, following this ruling by the CJEU, it is expected that states will restrict access to information on beneficial owners. Thus, although there will continue to be an obligation to inform the competent bodies with respect to beneficial owners, the number of persons who will be aware of their identity will be much smaller.