Summary 


This article will explain what the shareholding confirmation question within our secure web form means.


We will elaborate on Nominee director/shareholding confirmation, shares held in bearer form, and holding shares on behalf of another individual or entity. 


Please click on the region the the Reporting Entity (law firm, real estate agency, fund, etc.) you are transacting with is based in:


TABLE OF CONTENTS



New Zealand AML: Summary


A nominee is an individual or entity who is acting on behalf of another person (the true owner). The nominee is listed as a Director or Shareholder, however has no control or beneficial ownership of the company, and is only acting on instruction of the true owner. If you have a nominee director or shareholder, you will have a Deed of Nomination. 

 

It is rare for New Zealand, Australia or United Kingdom Companies to have any nominee directors or nominee shareholders, if you haven’t heard of them, chances are there are no nominees in your own entity structure. 

 

If you do not have any of the below - please tick "NO". 


Click the arrow circled as shown below to expand the secure web form:


Select "No" and then click "submit" to confirm shareholding



Select "No" and then click "submit" to confirm shareholding



What is a nominee?

 

In business, a nominee is an individual or entity who is acting on behalf of someone else (the true owner). The overall ownership, benefits and liabilities still lie with the true owners who may be a Domestic or International business.



What is a Nominee director/shareholding confirmation ?

 

A nominee Director is listed as a Director, however has no control over the company, and is acting on instruction of the true owner. 


A nominee Shareholder is listed as a Shareholder, however has no beneficial ownership of the company, and is holding the shares on behalf of the true owner. 


A nominee General Partner is a company who is listed as the General Partner within a Limited Partnership, however is acting on behalf of the true owner. 



What are shares in bearer form?

 

Shares held in bearer form are when an individual (listed publicly as “The Bearer”) owns shares anonymously in the form of a physical share certificate. The only way of knowing who the owner is, is if they are holding the share certificate in their hand. 

 

Bearer shares are considered high-risk in the eyes of the AML/CFT Act as this method of ownership is highly unregulated, and it is very easy to hide the real beneficial owner. This means that it is very rare in New Zealand and illegal in Australia and United Kingdom.




What if my entity structure does have any of the above?

 

You will find when you click "YES" on our web form that we will ask for you to upload supporting documents for your company as shown below. You will then be contacted by the First AML team assigned to your case to provide Source of Wealth evidence. 



 

See: What is a Source of Wealth?


Australian AML: Summary


All Australian reporting entities are legally obligated to identify the true beneficial owners of their customers. A beneficial owner is an individual who ultimately owns or controls an entity such as a company, trust or partnership. 



The identity of true beneficial owners can be kept anonymous to the public by having non-beneficially held shares, shares which are held on behalf of another entity/individual. 



What does holding shares on behalf of another entity or individual mean?


If an individual or entity is holding shares on behalf of another individual or entity, their shares are non-beneficially held. This means that the shareholder does not benefit directly from the shares, and are holding them on behalf of someone else (the true owner). 



The true owner receives the direct benefits from the shares, such as voting rights and rights to the dividends paid. Details of the true beneficial owner are not listed on the ASIC extract, which keeps the true owner’s identity anonymous from the public. 

 


An example of this is a trustee who is holding shares for the beneficiaries of a Trust. The trustee is named as a shareholder on the ASIC, however the beneficiaries of the Trust are the individuals who receive the direct benefits from the shares. 



What if my entity structure does have any of the above?


If you have the above shareholding arrangement in your entity structure, please click “YES” on our secure web form when prompted. 



You will find that when you click “YES” on our web form that we will ask you whether the shares are held on behalf of a Trust or not. 



If the shares are held on behalf of a Trust, click “YES”. You will be asked to upload a copy of your Trust Deed and any amendment which has been certified within the past two years. Please see the certification guidelines here

  


What if my entity structure does not have any of the above?


If the above shareholding arrangements are not applicable to you, please click “NO” on our secure web form when prompted. 



United Kingdom AML: Summary


All UK relevant persons are required to identify beneficial owners and ultimate beneficial owners of their customers. A beneficial owner is an individual who ultimately owns or controls an entity such as a company, trust or partnership.

The identity of true beneficial owners can be kept anonymous to the public by having non-beneficially held shares, shares which are held on behalf of another entity/individual. One way this can be achieved is via nominee director/shareholding arrangements.


How do I know if my entity has any nominee directors, nominee shareholders or shares in bearer form?

It is rare for entities to have nominee directors and/or shareholders.

A nominee director is an individual or entity acting on behalf of the nominator (who is not illustrated on the company register).

A nominee shareholder is holding shares on behalf of the nominator (ultimate beneficial owner). If you do have any nominees, you will have a Deed of Nomination or an equivalent document.

Shares held in bearer form are when an individual (listed publicly as “The Bearer”) owns shares anonymously in the form of a physical share certificate. The only way of knowing who the owner is is if they are holding the share certificate physically. Most UK & EU companies are prohibited from issuing bearer shares.


What if my entity structure does have any of the above?

If you have a nominee director or shareholder or shares in bearer form arrangement in your entity structure, please click “YES” on our secure web form when prompted.

You will find that when you click “YES” on our web form you will be asked to upload a copy of your Deed of Nomination and any supporting documents e.g. amendment deeds. Based on the information provided, we may need to verify additional individuals and/or ask for further supporting information.


What if my entity structure does not have any of the above?

If the above shareholding arrangements do not apply to you, please click “NO” on our secure web form when prompted.