Beneficial ownership: the person behind the structure

Beneficial ownership · the person behind the structure, explained from zero

Every company is owned by someone — but the shareholder on the paperwork is not always that someone. This dossier explains, from zero, what beneficial ownership means, how the EU, UK and Swiss registers each answer "which human being controls this entity?", and how an investigator walks a chain through all three. No prior knowledge assumed; every rule is cited to the instrument that contains it.

The gist in four lines, if you read nothing else:

A beneficial owner is the natural person who ultimately owns or controls an entity — legal ownership can stack forever, beneficial ownership stops at a human.
Roughly 25% is the shared threshold, but each regime words it differently, and every regime adds a control-in-fact test to catch anyone who arranges the percentages to hide.
The three registers show different audiences: the UK shows the public, the EU shows those with a legitimate interest, Switzerland (from 1 Oct 2026) shows only authorities.
Every register is self-declared — read it as a claim to verify, not a fact.

The idea: find the natural person, through any structure

A company can be owned by a company, which is owned by a trust, whose trustee is a company incorporated somewhere else. Legal ownership can be stacked indefinitely; beneficial ownership cannot, because it is defined to stop only at a human being. The FATF — the intergovernmental standard-setter whose Recommendations are the template for every serious AML system — defines the beneficial owner of a legal person as the natural person(s) who ultimately owns or controls a customer, or on whose behalf a transaction is being conducted, including those exercising ultimate effective control; its glossary adds, in terms: "Only a natural person can be an ultimate beneficial owner." For trusts and similar arrangements, the definition simply lists the parties — settlor, trustee, protector, beneficiaries, and anyone else exercising ultimate effective control.

Two mechanics inside that definition do most of the work:

The ownership test and the 25% convention. The FATF standard does not actually mandate 25%. Its interpretive notes describe a "controlling ownership interest" that may be based on a threshold — "e.g. 25%" — and cap any national threshold at a maximum of 25%. The number is a convention that nearly everyone adopted at the ceiling; each regime below writes it slightly differently, and the differences matter.
Control in fact. Ownership percentages are necessary but not sufficient. Every regime adds a second, open-textured test — control "via other means", "significant influence or control" — precisely because a person determined to hide will arrange the percentages to fall below whatever line the statute draws. The tests are cascading: where the ownership test identifies no one, the control test still applies.

Why registers exist. Recommendation 24, as revised in 2022, requires countries to ensure that adequate, accurate and up-to-date beneficial-ownership information "can be obtained or accessed rapidly and efficiently by competent authorities, through either a register of beneficial ownership or an alternative mechanism" — a multi-pronged approach in which the company itself, a public authority, and supplementary measures each hold part of the picture. The three systems below are three different answers to how much of that picture anyone else gets to see.

The EU: one definition, directly applicable

Until now, EU beneficial-ownership rules lived in directives, transposed 27 slightly different ways. From 10 July 2027, Regulation (EU) 2024/1624 — the AMLR, the single rulebook — applies directly in every member state. Its Chapter IV was written against exactly the divergence the directives produced — the recitals record that member states applied different methods to identify the beneficial owners of the same entity — and it is drafted with corresponding precision:

The threshold is "25% or more" of shares, voting rights or other ownership interest (Art. 52(1)), counted at every level of the structure. Indirect holdings are calculated by multiplying the interests along each chain and adding the chains together: a person holding 50% of a company that holds 50% of the target holds 25% — and is a beneficial owner.
Control is defined separately (Art. 53): through ownership, it means 50% plus one; "via other means" it includes majority voting power, the right to appoint or remove a majority of the board, relevant veto or decision rights, profit-distribution decisions — and, expressly, informal channels: agreements with owners, relationships between family members, and formal or informal nominee arrangements. Control via other means must be checked "independently of and in parallel to" the ownership test (Art. 51).
The threshold can go lower. For categories of corporate entities identified as higher-risk, delegated acts may set a lower threshold — at most 15% in the standard case, and in any case below 25% (Art. 52(2)).
When no owner is found, the file must say so. An entity that has exhausted the tests records the steps taken and reports its senior managing officials to the register instead, with a justification (Art. 63(3)–(4)). Changes must reach the register within 28 days; the entity must re-verify its information at least annually (Art. 63(2)). Nominee shareholders and directors must disclose their status and their nominator to the entity, which reports both to the register (Art. 66).

The registers themselves are governed by the companion directive, Directive (EU) 2024/1640 (AMLD6). Each member state keeps a central register whose administrators are empowered to demand board resolutions, partnership agreements, trust deeds and powers of attorney to check a filing (Art. 10(4)), and must verify filings and run them against targeted-financial-sanctions designations (Art. 10(7), (9)).

Who may look is the part the Court of Justice rewrote. The 2018 directive had opened beneficial-ownership data to "any member of the general public"; in Joined Cases C‑37/20 and C‑601/20 (Luxembourg Business Registers, Grand Chamber, 22 November 2022) the Court declared that provision invalid, holding that general public access "constitutes a serious interference with the fundamental rights enshrined in Articles 7 and 8 of the Charter". AMLD6 is the legislated answer: access for any person who can demonstrate a legitimate interest in preventing or combating money laundering, its predicate offences or terrorist financing (Art. 12(1)) — with the interest presumed for named categories including journalists and media, civil-society organisations and academia connected with that purpose, persons likely to enter into a transaction with the entity, and third-country obliged entities performing due diligence (Art. 12(2)). Access is granted without alerting the entity concerned; journalists and civil-society organisations also receive historical data and a description of the control structure, and cannot later be identified to the beneficial owner as the ones who asked (Art. 12(4)). Member states had to bring exactly these access articles (Arts. 11–13, 15) into force by 10 July 2026 (Art. 78(1)) — so legitimate-interest access is the current EU position, a year before the rest of the framework applies.

So what — the EU model is now: precise arithmetic, low tolerance for "no beneficial owner found", and gated transparency. A reader who last looked in the era of fully public registers (2018–2022) holds an out-of-date map in both directions: the public door closed in November 2022, and the legitimate-interest door — wide enough for journalists, NGOs and prospective counterparties — was required to be open from July 2026.

Check yourself. A person holds 50% of Company A. Company A holds 50% of Company B, the entity you are investigating. Under the AMLR, is that person a beneficial owner of Company B?

Yes — at exactly the threshold. Art. 52(1) counts indirect holdings by multiplying along the chain: 50% × 50% = 25%, and the EU test is "25% or more". Two traps sit in that arithmetic. First, had either link been 49%, the product would be 24.5% and the ownership test would fail — at which point the control test in Art. 53 still runs independently, and a right to appoint the board or a veto over distributions would make the person a beneficial owner anyway. Second, the same facts give a different answer in London: the UK's Schedule 1A condition is "more than 25%", so exactly 25.0% does not meet it. Same structure, same percentages, two answers.

The UK: the oldest public register, and its overseas annex

The UK put beneficial ownership on a public register earlier than either of the other two systems here, and runs two distinct registers.

The PSC regime. Since 6 April 2016, UK companies have had to identify their people with significant control under Part 21A of the Companies Act 2006, inserted by the Small Business, Enterprise and Employment Act 2015. Schedule 1A sets five conditions: holding, directly or indirectly, more than 25% of the shares; more than 25% of the voting rights; the right to appoint or remove a majority of the board; the right to exercise, or actual exercise of, significant influence or control; and a fifth condition catching trusts and firms whose trustees or members meet a condition, where a person has significant influence or control over that trust or firm. The data is filed at Companies House and is free and public — the feature that makes the UK the natural starting point of almost any tracing exercise.

Note the wording: "more than 25%". A person at exactly 25.0% meets the EU and Swiss ownership tests ("25% or more" / "at least 25%") but not the UK shareholding condition. The boundary case falls on different sides of the Channel — a small fact with a practical consequence: percentage thresholds are legal drafting, not natural law, and must be read in each regime's own words.

Identity verification. The register's historical weakness was that nobody checked who was filing. Under the Economic Crime and Corporate Transparency Act 2023, identity verification at Companies House became a legal requirement on 18 November 2025: new directors and PSCs must verify (via GOV.UK One Login or an authorised corporate service provider), and existing ones are swept in over a 12-month transition as their companies file confirmation statements.

The Register of Overseas Entities. UK land owned through foreign companies was the classic opacity pattern, and the Economic Crime (Transparency and Enforcement) Act 2022 answered it with a second register, live since 1 August 2022: an overseas entity that owns or wants to acquire UK land must register its beneficial owners at Companies House. The reach is retrospective — it captures land held since 1 January 1999 in England and Wales, since 8 December 2014 in Scotland, and since 5 September 2022 in Northern Ireland — and the enforcement mechanism is conveyancing itself: without an Overseas Entity ID, the land registries will not register the title. Information must be verified by a UK-supervised agent before filing (since 15 January 2023), and the entity must file an update statement annually.

The trusts gap — and the 2026 loosening. Where the beneficial owner of an overseas entity is a trustee, the trust's details are filed but not shown on the public face of the register. Since 31 August 2025, under Part 3 of SI 2025/231, anyone may apply to Companies House for that trust information — but the application originally required the trust's name, which an outsider by definition rarely knows. SI 2026/778, in force 9 July 2026, removed that requirement, and provides that where an application touches a person under 18 the legitimate-interest test bites only on that part of the information, leaving the rest disclosable. For tracing UK property held through overseas entities, you no longer need to know the trust's name in order to ask about it.

So what — the UK now runs the most open system of the three: a public PSC register, a public overseas-entities register, and an application route into the trust layer that was loosened in the reader's favour in July 2026. Its historical weakness — self-reported, unverified data — is being closed by ECCTA identity verification, but the register's past is unverified, and a filing made in 2019 proves only what someone chose to file in 2019.

Switzerland: from bank forms to a federal register

Switzerland has long collected beneficial-ownership information — it simply kept it in different hands. Until October 2026 the mechanics are these:

The bank asks. Under Art. 4 AMLA, a financial intermediary must establish the beneficial owner "with the due diligence required in the circumstances", and must obtain a written declaration from the customer where the customer is not the beneficial owner or doubt exists, where the customer is a domiciliary company or an operating legal entity, or for cash transactions of considerable value. That written declaration is the famous Form A of the banks' CDB 20 code of conduct; Form K does the same for the controlling persons of operating companies, who are defined in Art. 2a(3) AMLA as the natural persons holding at least 25% of capital or votes, or controlling the entity in another way — failing whom, the most senior executive is recorded instead. A false Form A is the classic predicate for forgery charges alongside a Swiss AML case.
The company is told. Under Art. 697j CO, anyone acquiring shares in an unlisted company who reaches or exceeds 25% of capital or votes must, within a month, notify the company of the natural person for whom they are ultimately acting. The company keeps its own list; no authority holds it. Bearer shares — historically the anonymity instrument — are permitted only for listed companies or as intermediated securities (Art. 622(1bis) CO).

What changes on 1 October 2026. Parliament adopted the Transparency of Legal Entities Act (TJPG/LETA, BBl 2025 2900) together with a revised AMLA on 26 September 2025, and the Federal Council brought both into force on 1 October 2026 (decision of 12 June 2026). The mechanics, from the statute:

Definition (Art. 4 TJPG): the beneficial owner is any natural person who ultimately controls the company, directly or indirectly, alone or in concert with third parties, through at least 25% of capital or votes — or controls it in another way. Fallback where no one qualifies: the most senior member of the managing body.
A federal register, electronically kept by the Federal Office of Justice (Art. 20), with a control body at the Federal Department of Finance checking accuracy (FOJ; the register runs at transpareg.admin.ch, piloted since 16 June 2026). Companies (AG, GmbH, cooperatives, SICAV/SICAF and others) file; foundations, associations and listed companies (with their more-than-75%-held subsidiaries), among other exemptions, are outside the duty; foreign entities with a Swiss branch, Swiss effective administration or Swiss real estate are inside it (Arts. 2–3).
Deadlines: new entities file within one month of commercial-register entry (Art. 9(4)); changes within one month of knowledge (Art. 10); existing entities file on their first commercial-register change or, at the latest, within staged windows of three to six months from 1 October 2026 — with up to two years only where every beneficial owner already appears in the commercial register as member or officer (Art. 51). Shareholder notifications already made under Art. 697j CO carry over (Art. 49).
Access is enumerated, and the public is not on the list. Prosecution, police, tax, sanctions and other named authorities may query the register online (Art. 26); financial intermediaries and the newly covered advisers may query it only so far as needed for their AMLA due-diligence duties (Art. 27). There is no public-access provision. Financial intermediaries who find a discrepancy between the register and their own file must — after giving the customer a chance to correct it — report it within 30 days (Art. 30).
Teeth: intentional breach of the reporting duties carries fines up to CHF 500,000 (Art. 43), prosecuted by the Federal Department of Finance. The register entry is declaratory, and an intermediary may rely on it only where its own AMLA-grade checking reveals nothing to the contrary (Art. 23) — the register supplements Form A diligence; it does not replace it.

The revised AMLA also extends due-diligence duties to certain risk-bearing advisory activities — the Federal Council's release names this as the second pillar of the package — bringing structuring advisers towards the perimeter lawyers and fiduciaries have long tested.

So what — from 1 October 2026 Switzerland stops being the jurisdiction where beneficial-ownership information exists only bilaterally, in bank files and company drawers. But the register is a tool for authorities and obliged entities, not for the public: an outside investigator's view of a Swiss company remains the commercial register — the legal shell — plus whatever the chain reveals in more open jurisdictions.

Check yourself. From 1 October 2026 Switzerland has a federal beneficial-ownership register. You are a journalist tracing a Swiss company. What does the register give you?

Nothing. The TJPG enumerates who may query, and the public is not on the list: named authorities — prosecution, police, tax, sanctions — under Art. 26, and financial intermediaries and newly covered advisers under Art. 27, the latter only so far as their AMLA due-diligence duties require. There is no legitimate-interest door as in the EU and no public register as in the UK. This is the sharpest of the three contrasts, and the one most often got wrong: "Switzerland now has a register" is true and tells an outside investigator nothing about what they can see. Your Swiss visibility remains the commercial register — directors, capital, GmbH quota-holders — plus whatever the chain exposes in more open jurisdictions, or a route through mutual legal assistance.

The register that was breached

The counterargument to every centralised register materialised this summer. During the night of 29–30 July 2026, an unknown third party gained unauthorised access to Liechtenstein's beneficial-ownership register (the Verzeichnis wirtschaftlich berechtigter Personen) and copied data relating to some 31,000 legal entities; the Government took the register offline and precautionarily disconnected further systems holding sensitive data, describing the intrusion as a targeted attack at a high technical level and stating that, on current knowledge, no data was altered or deleted.

Held to this practice's own discipline, the incident proves less than either side of the register debate wants it to: one breach of one register does not establish that the class is indefensible — the mechanism has not been published, and the Swiss register's exposure will be determined by its own control design, not by Liechtenstein's. What the breach does establish is concrete: a central register concentrates exactly the data — name, birth date, nationality, extent of control — that its subjects were compelled to file, and register security is now part of register design, three months before Switzerland opens its own.

Walking a chain — and where each register lies to you

The mechanics of an actual trace, register by register:

Start where the data is public. For a UK company, Companies House shows the PSC filings free, with the condition met and the band of control stated. For UK land, the title register names the proprietor; if that proprietor is an overseas entity, its beneficial owners are on the Register of Overseas Entities — and if the chain runs into a trust, the trust information can be applied for, since 9 July 2026 without knowing the trust's name.
Cross into the EU on legitimate interest. National registers answer under Art. 12 AMLD6: the request must connect to preventing or combating money laundering, its predicates or terrorist financing, but journalists, civil-society researchers and prospective counterparties are presumed categories — and the entity is not alerted.
Expect the wall in Switzerland — and plan around it. No public register exists, before or after 1 October 2026. The public trail is the commercial register (directors, registered capital, GmbH quota-holders); the beneficial-ownership layer is reachable by authorities, via mutual legal assistance, or through an obliged entity's own file — not by open-source inspection.
Read every register as a claim, not a fact. All three systems rest on self-declaration — the Swiss register says so on its own front page — corrected after the fact by verification duties and discrepancy reporting (obliged entities must report register-versus-file mismatches: Art. 24 AMLR; Art. 30 TJPG). The AMLR states the investigator's rule in a recital: consulting the register "should not be the obliged entity's primary source for verification".
Know the standard evasions, and the provisions written against them. Threshold engineering: four holders at 24.9% each meet no ownership test anywhere — which is exactly why every regime carries a control-in-fact condition, why the EU counts holdings "individually or cumulatively" and in concert, and why the AMLR provides for lower thresholds for high-risk categories. Nominees: a name that appears for a fee; the AMLR obliges nominees to disclose their nominator (Art. 66), and FATF R.24 asks countries to make nominee status visible or license it. The respectable fallback: "no beneficial owner identified — senior managing official listed instead" is a lawful entry in every regime (Art. 63(4) AMLR; Art. 4(2) TJPG; managing officers on the ROE). Read it as a flag, not an answer: it means the tests ran out, not that no one is in control.

Check yourself. You pull a filing and it reads: "No beneficial owner identified; senior managing official listed." Has the company complied — and what should you do with that entry?

It is compliant, and it is a flag, not an answer. Every regime expressly permits the senior-official fallback once the ownership and control tests are exhausted (Art. 63(4) AMLR; Art. 4(2) TJPG; managing officers on the UK's overseas-entities register), so the filing breaks no rule. But it records that the tests ran out, not that no human controls the entity — which is exactly the entry a well-structured concealment produces on purpose (four holders at 24.9%, a diffuse board, a nominee layer). Treat it as the trigger for the control-in-fact analysis: who appoints the board, who holds veto or distribution rights, what agreements or family relationships sit off the share register. The fallback is where the register stops and the investigation starts.

So what — reading for practitioners. Three registers, three disclosure philosophies: the UK shows the public, the EU shows those with a reason, Switzerland shows the authorities. A chain that spans all three is therefore asymmetrically visible, and structuring practice knows it — which is why the UK end of a structure is often the cleanest and the Swiss end the quietest. For a compliance team, the operational rules are: verify against the entity's own documents, not the register alone; treat threshold-adjacent holdings and senior-official fallbacks as triggers for the control-in-fact analysis; and diarise the dates that change the map — the Swiss register's staged filing windows from 1 October 2026, and the AMLR's full application on 10 July 2027. Instrument stages are tracked on Regulatory Watch.

Sources

FATF, International Standards on Combating Money Laundering and the Financing of Terrorism & Proliferation — the FATF Recommendations, consolidated text as updated June 2026 (glossary definition of beneficial owner; INR.10 and INR.24 threshold and multi-pronged-approach provisions).
Regulation (EU) 2024/1624 (AMLR), OJ L, 19 June 2024 — Arts. 51–67, 90; recital 54.
Directive (EU) 2024/1640 (AMLD6), OJ L, 19 June 2024 — Arts. 10–13, 78.
CJEU, Joined Cases C‑37/20 and C‑601/20, Luxembourg Business Registers (Grand Chamber, 22 November 2022), ECLI:EU:C:2022:912.
Companies Act 2006, Part 21A and Schedule 1A — legislation.gov.uk.
Economic Crime (Transparency and Enforcement) Act 2022 (c. 10), Part 1; Guidance for the Registration of Overseas Entities (August 2025), GOV.UK.
Economic Crime and Corporate Transparency Act 2023 (c. 56); Companies House, Changes to UK company law — identity verification (mandatory from 18 November 2025).
SI 2025/231 (in force 28 February 2025; Part 3, 31 August 2025) and SI 2026/778 (in force 9 July 2026) — legislation.gov.uk.
Anti-Money Laundering Act (AMLA/GwG, SR 955.0), Arts. 2a, 4; Code of Obligations (SR 220), Arts. 622, 697j — Fedlex.
Bundesgesetz über die Transparenz juristischer Personen (TJPG), BBl 2025 2900 (adopted 26 September 2025) — Fedlex; Federal Council media release of 12 June 2026 (in force 1 October 2026); Federal Office of Justice and transpareg.admin.ch register pages.
Government of the Principality of Liechtenstein, statement on unauthorised access to the VwbP register, 30 July 2026.

Orientation, not advice · verify against the primary texts · instrument stages tracked on Regulatory Watch