Privacy protection organisation loses preliminary relief proceedings and appeals procedure
The privacy aspects of the UBO register are much debated. This year, Privacy First, a foundation that stands up for the right to privacy, even litigated in two instances with the objective to stop the UBO register in its current form, because this would be in violation of the fundamental right to privacy and the protection of personal data. Read more here:
Earlier this year, we already informed you in detail about het UBO-register. A UBO is the Ultimate Beneficial Owner of a legal entity or partnership, i.e. the natural person who ultimately has the ownership or control. If you are already an entrepreneur through a legal entity or partnership, you must arrange your registration as UBO in the register before 27 March 2022, through the Trade Register of the Dutch Chamber of Commerce.
Which data are public and which data are not?
A number of data from the UBO register are public and therefore accessible to everyone. These are name, month and year of birth, state of residence, nationality and nature and extent of the economic interest in the legal entity or partnership. Other data can only be viewed by competent authorities. This concerns place of birth, day of birth, residential address, BSN and TIN, copy of identity document and documents which show the interest and the size of the interest in the legal entity or partnership.
Can data in the UBO register be protected?
Although there are possibilities to protect the privacy of UBOs, these possibilities are relatively limited. Blocking of data can only be requested if it concerns information regarding minors, or persons who receive police protection or are under guardianship or administration. In that case, only the interest and the extent of the interest of the UBO can be seen. The shielded data can still be viewed by Wwft institutions with a financial task and by the competent authorities (think of the Public Prosecution Service and the Tax Authorities).
What was the procedure of Privacy First about?
Early this year, privacy foundation Privacy First initiated summary proceedings against the Dutch State concerning the UBO register.The foundation claimed, inter alia, the temporary suspension of the obligation to provide UBO data to the Trade Register, and the suspension of the right of everyone to consult the UBO register. The privacy organisation also wanted preliminary questions to be submitted to the Court of Justice of the EU about the compatibility of the EU directives (on which the Dutch legislation is based) with the EU Charter of Fundamental Rights and the GDPR.
What did the court in preliminary relief proceedings and the court of appeal rule?
The court in preliminary relief proceedings in The Hague rejected the claims of Privacy First and the foundation also failed in its appeal, given the judgment of 16 November 2021. This means that the Dutch legislation on UBOs does not have to be set aside. According to the court, it has not been made plausible that the UBOs will suffer serious damage in the short term. This is a requirement to be able to (provisionally) suspend legislation based on European directives in preliminary relief proceedings. The Court of Appeal also took into account that an UBO who fears that, by disclosing his personal data, he will run the risk of abduction, extortion or the like, can immediately shield all his data from the general public. Dutch legislation provides for this possibility, according to the court.
If you want to read the judgment in summary proceedings, you can do here . The judgment on appeal can be found here.
Final Remarks
Although Privacy First was ultimately not found to be in the right, we doubt whether this means that the legal discussion about the privacy aspects of the UBO register has been definitively closed. We suspect not. After all, a Luxembourg court did ask preliminary questions to the Court of Justice of the EU. These questions concern the public accessibility of the UBO register and its compatibility with the right to privacy, and the scope of the possibility to block public data. As soon as more is known about the outcome of these procedures, we will of course inform you.
Do you also have questions about company law, the UBO register and/or privacy considerations? Please contact SPEE advocaten & mediation.