An extension until March 31 has been granted for all companies to register in the Cyprus Beneficial Ownership Registry of the Registrar of Companies, announced George Papanastasiou, the Minister of Commerce, Energy, and Industry. He was called by the relevant Parliamentary Committee to provide explanations for the market disruption caused by this issue.

Additionally, the Minister of Commerce will await a legal opinion by Friday on whether the fines imposed since January 1, 2024, for non-compliance can be annulled.

The Minister urged all companies to comply by registering their details by March 31. This compliance will properly finalize the platform where beneficial owners' details will be recorded and linked electronically with other state services.

During a heated discussion in the Parliamentary Committee on Energy, lawmakers and other stakeholders sharply criticized the Registrar of Companies and the Ministry for the transition from the interim to the final platform regarding the Beneficial Ownership Registry. Criticisms focused on the narrow window for re-entering data for hundreds of thousands of companies, occasional system failures, and the imposition of exhaustive fines for non-compliance.

The Minister admitted to mistakes made and declared his intention for immediate resolution following legal advice, while Committee members expressed readiness to proceed with new legislative measures if necessary.

During the Committee session, the Minister emphasized the importance of creating a Beneficial Ownership Registry in line with European Commission requirements, among others, for transparency and restoring Cyprus's international reputation. He mentioned feeling uncomfortable at international meetings due to Cyprus being associated with corruption.

However, the Minister acknowledged that in implementing the legislation, all companies were treated as if they were trying to cheat the system. He noted that laws should not always be applied at the highest level but should consider the environment in which they are implemented. He admitted that one regulation is exhaustive and indiscriminate.

He also recognized weaknesses in creating the digital interim solution platform for declaring beneficial owners' details, due to time pressure following the law's implementation on February 23, 2021, and the risk of EU-imposed fines. The interim platform, he said, could not connect with other state platforms and had a serious weakness in verifying the details.

After identifying these weaknesses, he stated, they proceeded to create another platform for compliance and control of details last November.

He also noted that over 190,000 companies had to re-enter their details into the new platform within six weeks, with no extension given to companies that had not entered their details in the interim platform.

He spoke of the confusion created and the need for correction, stating that they requested legal advice to extend the deadline for companies that had not registered in the interim platform and to prevent the imposition of already levied fines since January 1, from which 2 million euros had already been collected.

It is noted that the fine for non-compliance was 200 euros, with an additional 100 euros for each day of delay, up to 20,000 euros. Fines were imposed not only on companies but also separately on directors and secretaries.

Irene Mylona Chrisostomou, the Registrar of Companies, mentioned that companies can now enter their details into the system, accepting the imposed fine without, however, having to proceed with its payment.

On behalf of IBM, which undertook the creation of the platform, it was mentioned that there was no possibility to transfer data from the interim to the final platform, as the initially entered data were in free text format without the possibility of verification.

The Registrar of Companies noted that there was an opportunity to enter data without being able to check their quality, given the tight timelines.