Under the Estonian MLTFPA, the UBO is the natural person who ultimately owns or controls a legal entity. For corporations, a UBO is typically identified in two main ways. Firstly, through material ownership, which is defined as a person who directly or indirectly holds more than a 25% share in the company or its voting rights. Secondly, through control, which refers to a person who influences the company’s decisions behind the scenes, regardless of their ownership stake. If, after exhausting all reasonable efforts, no UBO can be identified based on the criteria above, the law establishes a substitute mechanism. In such cases, the members of the highest management body of the legal entity (e.g., the management board) are registered as its UBOs.

Which Entities Must Register Their UBO?

The obligation to register a UBO applies to most legal entities registered in Estonia, including private limited companies (OÜ), public limited companies (AS), general and limited partnerships, commercial associations, foundations, and non-profit associations. The law provides for several specific exemptions, including apartment associations, building associations, companies listed on a regulated market (subject to equivalent EU disclosure requirements), and foundations that do not pursue economic activities.

The UBO Identification and Registration Process in Estonia

The process involves both correctly identifying the UBO and formally registering their data in the e-Business Register. Submissions are made electronically through the official portal, a process seamlessly integrated into Estonia’s digital infrastructure, often utilizing e-Residency cards, Mobile-ID, or Smart-ID. The management board of the entity is responsible for submitting and updating the information. New entities must submit their UBO data upon establishment. For existing entities, any changes to the UBO data must be updated in the register within 30 days of the change occurring. ECOVIS provides full support throughout this process, from analysing your corporate structure to managing the electronic registration with the authorities.

Public Access to the Estonian UBO (e-Business Register) Register

Estonia’s UBO data is publicly accessible through the e-Business Register, and all information can be viewed free of charge. Anyone can query the register to confirm if a person is registered as a UBO. The public can view the following information without any fee:

• Full name
• Personal identification code (or date of birth if no code is available)
• Country of residence
• Information on the nature of their control (e.g., size of share, manner of exercising control)

The public portal can be accessed at ariregister.rik.ee. This system ensures a high degree of transparency and reflects Estonia’s commitment to open-data principles and a trustworthy business environment.

Consequences of Non-Compliance in Estonia

Failure to comply with UBO registration duties carries significant sanctions that can directly impact a company and its management. The primary consequences include:

• Fines: A fine of up to €400,000 can be imposed on the legal entity for failing to submit UBO data, submitting incorrect or incomplete information, or failing to update it in a timely manner. The responsible natural person (e.g., a member of the management board) can also be fined up to €2,400 for the same violations.
• Business and Financial Restrictions: Obliged entities, such as banks and financial institutions, are required to refuse to establish a business relationship or may terminate an existing one if a company fails to provide accurate UBO information. This can severely hinder a company’s ability to open bank accounts, secure financing, or conduct day-to-day operations.
• Reputational Damage: Non-compliance can lead to increased scrutiny from authorities and business partners, potentially damaging the company’s reputation and trustworthiness in the market.

Ensure Your Compliance and Avoid Penalties in Estonia

Correctly identifying your Ultimate Beneficial Owner and ensuring their proper registration is a critical legal requirement. Our team of experts provides a comprehensive service that covers both the UBO identification based on your specific corporate structure and the complete handling of the registration process. By entrusting this task to us, you can be confident in your compliance and avoid the severe penalties associated with any errors. Contact our team for personalized advice or book an online consultation.