Mandatory acceptance procedure for lawyers
The Law of 11 January 1993 on the prevention of the use of financial systems for money laundering and terrorist financing, in short ‘the anti-money laundering law’, may not mean much to you. Yet this law has implications, not only for the relationship with your bank, your notary or other financial advisers, but also for your relationship with your lawyer.
For the implementation of the anti-money laundering law, the Order of Flemish Bars has issued regulations that must be strictly complied with by all lawyers as of 30 December 2011. These regulations require every lawyer to carry out an acceptance procedure for every client and every case file.
As we consider it important to inform you about this, you will find an explanation below.
We assess the nature of the contract
We are required to check the nature of the contract you wish to assign to us, so that we can determine whether the anti-money laundering law is applicable.
Insofar as this contract relates to specific matters that the legislator has designated as ‘money-laundering sensitive’, the anti-money laundering law may apply, and we are required to carry out an identity investigation. This specifically relates to the following assignments:
- Acting in your name or on your behalf in financial transactions, or transactions relating to real estate.
- Assisting you in the preparation or execution of one of the following transactions:
i. The purchase or sale of real estate or companies.
ii. The management of funds, securities or other assets.
iii. The opening or management of bank, savings or securities accounts.
iv. The organisation of contributions necessary for the foundation, operation or management of companies
v. The foundation, operation or management of companies, trusts, fiduciaries or similar legal structures.
The anti-money laundering law is not applicable to advice regarding the determination of your legal position, and to conducting, preparing and even avoiding legal proceedings, and these activities therefore do not require an identity investigation.
The identification procedure
Insofar as it would appear that the contract to be entrusted to us falls under the application of the anti-money laundering law, we are obliged to inquire about your identity, and that of any legal person who may represent you. We will ask you for a copy of your identity card, and, if it concerns a company, an extract from the Central Database for Enterprises. We may also have to ask you about the origin of the funds or asset components.
The final beneficiaries
We are required to identify the final beneficiaries of a client who is a legal person. This means that we must inquire about the natural persons who are assumed to exercise control over the company. In this case, exercising control means that they have a decisive influence on the appointment of the majority of the board members and/or directors, or on the orientation of the company.
In practical terms, we must inquire about the identity of all shareholders who own at least 25% of the shares in the company. If these shareholders are also legal persons, additional information is required to establish the identity of the natural persons who are the shareholders of those underlying companies. It is necessary to follow the chain of successive owners, and the shareholders of these owners, until the final owner has been identified. If this data needs to be adjusted in the course of our business relationship, we ask you to provide us with this information spontaneously.
Are you obliged to provide us with the information that we request?
We are prohibited by law from entering into a business relationship with you and are obliged to terminate our provisional interaction with you if we fail to receive the requested information within two weeks of the first request. It is therefore important that you grant your cooperation to the acceptance procedure.
What do we do with your data?
We guarantee full discretion with regard to all the data you entrust us with, both before and during our business relationship. The anti-money laundering law does not affect our professional secrecy. We will therefore only disclose the identification data that you have provided if the money laundering legislation requires us to do so.
Please ask us if you would like to receive a copy of the identification sheet that we keep. It will be provided immediately.
We rely on your understanding with regard to the acceptance procedure that we must follow, and assume that you will cooperate accordingly. Please be assured that this acceptance procedure will not in any way affect our professionalism and commitment to you.
Please contact us if you would like further information.