In a preliminary ruling, the Court of Justice of the European Union has ruled that a provision in the 5th Money Laundering Directive concerning unrestricted access to a register of beneficial owners is invalid.
The judgment ...
In its judgment of 22 November 2022 (C‑37/20 Luxembourg Business Registers and C‑601/20, Sovim, ECLI:EU:C:2022:912), the Court of Justice ruled that those provisions of the 5th Money Laundering Directive that require Member States to ensure that in all cases any member of the general public has access to information on the beneficial owners of companies registered in their territory are invalid.
According to the Court, the general public's access to information on the beneficial owners of a company constitutes a serious interference with the fundamental rightsto respect for private life and to the protection of personal data, as enshrined respectively in Articles 7 and 8 of the Charter of Fundamental Rights. This is because the information on beneficial ownership would enable an unlimited number of persons to obtain knowledge of the material and financial situation. It is also deemed abusive if this data can not only be freely accessed, but also retained and disseminated.
... and its consequences
The provision of the Money Laundering Directive in question has been declared invalid by the Court of Justice of the European Union.
This means the Austrian regulation, which transposed the Union law provision of the Money Laundering Directive into Austrian law, has subsequently become contrary to Union law.
As a consequence, Section 10 of the Beneficial Owners Registration Act (WiEReG), which enables the general public to inspect information on beneficial ownership, infringes Union law, but arguably it is also in violation of Austrian constitutional law.
The legislator will therefore have to amend Section 10 of the Beneficial Owners Registration Act.
Data subjects who oppose the "free" publication of their data could seek redress before the national courts.
For further information, please contact our experts at CERHA HEMPEL:
Alistair Gillespie, LL.M., BSc