Beneficial Owner Configuration Guide

Different countries have different legislation, and different obliged entities within the same country may choose to implement national legislation in different ways.

T-rank has a highly customizable approach to defining beneficial ownership. You may choose among several models; models can be combined and thresholds adjusted. You may even specify a cascading approach where model combinations are tried one by one until beneficial owners are identified.

For a more thorough review of T-rank's recommendations regarding the choice of calculation methods, see our white paper.

Models

Integrated ownership (integrated)

Integrated ownership is sometimes referred to as Effective ownership, Indirect ownership or Cash rights. It is the sum of any direct shareholding and indirect shareholdings an entity has in another, also taking any circular ownership into account.

Beneficial owners are most commonly defined as the natural persons who ultimately own or control a customer. In T-rank's opinion, integrated ownership is the best way to measure the owns part of this definition.

When calling the /v2/beneficial endpoint, this model is specified by the name integrated. The corresponding threshold is specified in the threshold_integrated parameter. Typical values are 25 (at least 25%) and >25 (more than 25%).

Voting Power (vp)

Voting Power is a (indirect) shareholders ability to influence the outcome of a vote at a general assembly. A shareholder with 100% voting power has complete control (is a majority shareholder). A shareholder with 50% voting power will be in a position to change the outcome of a vote in 50% of all possible voting combinations among the shareholders.

T-rank considers voting power to be the best way of defining Beneficial Ownership by means of influence in a company (the control part of the beneficial ownership definition).

When calling the /v2/beneficial endpoint, this model is specified by the name vp. The corresponding threshold is specified in the threshold_vp parameter. The default and recommended value for threshold_vp is 49.8.

Ownership at Each Level (simcon)

This is a model used in some national legislations, stating that if there is more than a certain threshold of ownership on each level between a natural person and a customer, the person should be considered a beneficial owner.

Clearly, if a person has some ownership in a company through a chain of minority shareholdings, that person will have no influence in the company, and the cash rights will become marginal. This is not a model recommended by T-rank.

The T-rank implementation of this model is a top-down recursive implementation. If a person has more than the threshold ownership in two companies, and these companies in sum have more than the threshold percent ownership in a third company, the person will be said to satisfy the model for the third company as well. We also adjust direct ownership for any circular self ownership not induced by the owner in question in the owned entity. For versions where we have both ownership and voting rights data, having more than the threshold percent of either voting rights or equity shares on each level will be sufficient.

When calling the /v2/beneficial endpoint, this model is specified by the name simcon. The corresponding threshold is specified in the threshold_simcon parameter. Only predefined values are supported for threshold_simcon - see API sprecification for specifics.

Control of Voting Rights (control)

This is the minimum definition in AMLD4. If a person - directly and through companies he/she controls, controls more than the threshold percent of the voting rights in the target company, he/she is a beneficial owner.

When calling the /v2/beneficial endpoint, this model is specified by the name control. The threshold for the share of voting rights that must be controlled is specified in threshold_control_share. Control is defined by means of voting power. How much voting power is needed for control may be specified in threshold_control_control and defaults to 99.9.

Beneficial Owner Registers (bo-register)

Note: Only supported in the Tieto version.

When a person is registered as a beneficial owner in a national register, that person becomes beneficial owner.

In order to gain access to the Danish and Finnish BO registers, you must be an obliged entity. In order to gain access to the Norwegian BO register, you must have applied for and been given access to the register through The Brønnøysund Register Centre. You must also delegate this access to T-rank and notify T-rank about the delegation.

When calling the /v2/beneficial endpoint, this model is specified by the name bo-register. If you also submit the parameter include_combine_reg=true, BO registers and any other models you have specified will be chained.

Norwegian Beneficial Owner Register Definition (ge50c-gt25).

Note: Only supported in the Tieto version.

This model mimics the definition set forth in the Norwegian Beneficial Owner Register legislation. If a person - directly and through companies he/she controls - holds more than 25% of the shares or voting rights in the target company, he/she becomes a beneficial owner. Control is defined as having at least 50% of the voting rights at every step of the control chain.

When calling the /v2/beneficial endpoint, this model is specified by the name ge50c-gt25.

Role (role)

Note: Only supported in the Tieto version.

A person having one of specified roles in the entity will be regarded as a beneficial owner. Note that this model is always active for foundations and trusts, regardless of which models you specify. Thus, this model is usually only specified as a fallback model when using a cascading approach.

When calling the /v2/beneficial endpoint, this model is specified by the name role. The parameter bo_roles can be used to specify a comma-separated list of roles that will trigger beneficial ownership.

Combining Models

The model parameter in /v2/beneficial may contain a comma-separated list of models, meaning that a person will become a beneficial owner if he/she satisfies at least one of the listed models.

Cascading Approach

Cascading approach means that the system should first try to find beneficial owners using one set of models. If none is found, try another set of models, and so on.

In v2/beneficial, a cascading approach is specified by separating each step in the sequence with colons.

Example:

model=vp,integrated:bo-register:role

First, check if there are any beneficial owners by applying the Integrated ownership and Voting Power models. If none are found, look in national beneficial owner registers. If still none are found, return the CEO and Board of Directors.

Family Relations

Note: Only supported in the Tieto version and for people registered in the Norwegian Population Register. In order for this to work, the calling party must have extended access to the Norwegian Population Register, and must have delegated these rights to Tieto.

When turned on, the owners of the company will be checked against the population register to determine whether they are close family according to the Norwegian AML legislation, If they are, they will be treated as a single unit when checking any of the models integrated, vp and simcon. When a set of close family members are found to satisfy a model, all members (who have ownership in the company) will be returned as beneficial owners.