A beneficial owner of a legal entity is any individual who owns or controls, directly or indirectly, more than 25% of the legal entity, or is otherwise able to exercise ultimate control over it.
What if no individual owns 25% or more of the company?
Then the individual who exercises “ultimate control” over the legal entity is the beneficial owner. Individuals considered to “exercise ultimate control” over your company are those responsible for managing and directing the business and may include executive officers or senior managers, such as Board Chairman, CEO, CFO, COO, Managing Partner, General Partner or President, etc.
The concept of “ultimate control” also includes the ability to exercise control over other shareholders (such as spouses, children, investees, etc), so that in aggregate the individual’s control exceeds 25%.
What if my business is owned by another company?
You are still required to identify the beneficial owner(s) of your legal entity. This person can be identified by finding out the ownership of the parent company (i.e. the company that owns your legal entity). For example, if you own 60% of Company A, which owns 50% of Company B, you are a beneficial owner of Company B because your percentage ownership is 30% in Company B. If Company B opens a Reap account, you will be required to provide your information as a beneficial owner.
What information do I have to provide?
You’ll be asked to provide the following about each beneficial owner:
Legal name; and
HKID card copy (Hong Kong residents); or
Passport copy (non-Hong Kong residents).
When do I need to provide this information?
We’ll request this information from the person who opens a new Reap account on behalf of a legal entity or the primary account user for an existing account.
Why do I need to provide this information?
To comply with financial crime regulations in the countries we operate in, we are required to obtain, verify, and record information about the beneficial owner(s) of legal entity customers. Legal entities can be used by criminals to commit crimes such as money laundering, terrorist financing, tax evasion, corruption, and fraud. Obtaining information about the beneficial owner(s) of a legal entity helps law enforcement investigate and prosecute financial crime.