EVOLUTION OF THE LEGAL REGULATION OF DISCLOSURE OF ULTIMATE BENEFICIAL OWNERS OF LEGAL ENTITIES

Abstract

The article presents a comprehensive historical and legal analysis of the formation and development of the legal regulation of the disclosure of information on ultimate beneficial owners of legal entities in Ukraine. It examines the prerequisites for the development of the relevant legislative framework, driven both by the domestic need to enhance the transparency of legal entities’ ownership structures as anti-corruption measures, and combat the laundering of illegal proceeds and the financing of terrorism, as well as by Ukraine’s obligation to fulfil its international commitments, particularly with regard to the implementation of the FATF Standards and the European Union law. Based on a retrospective analysis of legislation, the article identifies the principal stages in the evolution of the legal regulation of ultimate beneficial ownership disclosure and characterizes the distinctive features of each stage. It analyses legislative amendments concerning the definition of the concept of an ultimate beneficial owner, the procedures for submitting and updating relevant information, the introduction of the obligation to disclose the ownership structure of legal entities, the implementation of mechanisms for the identification, verification, and monitoring of the accuracy of beneficial ownership information, as well as the improvement of state registration procedures. The study establishes that the development of legislation has been accompanied by a gradual expansion of disclosure requirements concerning ultimate beneficial owners, the establishment of a comprehensive framework for ensuring ownership transparency, strengthened control over the accuracy of disclosed information, and the enhancement of legal liability mechanisms for violations in this area. The article concludes that the evolution of the legal regulation of ultimate beneficial ownership disclosure has been characterized by a transition from the formal declaration of beneficial ownership information to the establishment of a comprehensive system for ensuring the transparency of legal entities’ ownership structures, integrating mechanisms for identification, verification, updating, monitoring, and legal accountability. The study also identifies prospective directions for the further development of the legal framework, including its continued harmonization with European Union law, the improvement of information verification procedures, and the enhancement of the effectiveness of the ultimate beneficial ownership disclosure mechanism.