Beneficial owner of a German GmbH: who counts, and who must file

The beneficial owner (wirtschaftlich Berechtigter, often called UBO, ultimate beneficial owner) is the individual who ultimately owns or controls a company (§ 3 GwG): for companies, anyone holding more than 25 % of the shares, more than 25 % of the voting rights, or comparable control. If no such person can be identified, the legal representative, for a GmbH the managing director (Geschäftsführer), is deemed the beneficial owner. So there is always a beneficial owner. Every German GmbH, UG and AG must report them to the transparency register (Transparenzregister) and keep the entry current.

This page explains the terms so that filings and questions from banks make sense. It does not replace a legal assessment: for nested or disputed structures, the classification belongs with a lawyer or tax adviser.

The basic rule: more than 25 percent

A person is a beneficial owner of a company if they, directly or indirectly,

• hold more than 25 % of the share capital,
• control more than 25 % of the voting rights, or
• exercise control in a comparable way (§ 3 GwG), for example through veto rights or voting agreements.

Note the words "more than": exactly 25.0 % is not enough, 25.1 % is. And it is always an individual: a holding company can never be the beneficial owner itself.

Indirect ownership: follow the chain to a person

If another company holds the shares, the chain is followed: whoever controls the intermediate company is an indirect beneficial owner of the subsidiary. For a German GmbH owned by a Swiss AG, for example, the person behind the Swiss AG is the one to report.

The fictitious beneficial owner (§ 3 (2) GwG)

What if nobody is above the 25 % threshold, say five shareholders with 20 % each? Then the fallback rule applies: the legal representative, managing shareholder or partner is deemed the beneficial owner (§ 3 (2) GwG), the so-called fictitious beneficial owner (fiktiver wirtschaftlich Berechtigter). For a GmbH that is the managing director. Two consequences:

• There is no "empty" filing: a company without a major owner still files, in that case its management as fictitious beneficial owner.
• "Fictitious" does not mean without effect: the fictitious beneficial owner appears in the register and in every extract a bank requests, just like a real one.

What is filed for each beneficial owner?

Duty to file and fines

German companies must actively and without delay report their beneficial owners to the transparency register (§ 20 GwG). The former rule under which an entry in the commercial register counted as a filing no longer exists. Every later change, for example a share sale, must be reported as well.

Breaches are administrative offences (§ 56 GwG): up to 150,000 € for intentional breaches, up to 100,000 € otherwise, and in serious, repeated or systematic cases up to 1 million euros or twice the economic benefit. Fines are imposed by the Federal Office of Administration (Bundesverwaltungsamt). Gaps often come to light through discrepancy reports: banks and notaries must report differences between the register and their own findings (§ 23a GwG).

We transmit the filing for a simple GmbH or UG, as a first filing or a change: Transparency register filing.

Frequently asked questions