New EU Beneficial Ownership and Reporting Requirements: Implications for German Companies and Foundations

The EU Anti-Money Laundering Regulation (Regulation (EU) 2024/1624, the AMLR) will apply directly in all EU Member States from July 10, 2027, establishing a uniform European rulebook. In Germany, the German Money Laundering Act (Geldwäschegesetz, GwG) is proposed to be repealed and replaced by new national legislation supplementing the EU framework. The broader EU anti-money laundering package introduces, among other measures, an EU-wide cash payment limit, a revised scope of obliged entities, stricter requirements for internal controls to monitor financial transactions, a central European supervisory authority and tougher sanctions. It also changes the requirements for identifying and reporting beneficial owners. This client alert focuses exclusively on those changes.

The AMLR's beneficial ownership rules will require German companies and foundations to revisit determinations made under the GwG, even where their ownership and governance arrangements have not changed. The principal changes concern the inclusion of holdings of exactly 25%, the calculation of indirect interests, the identification of control beyond share ownership and the identification of a foundation's beneficial owners as beneficial owners of companies in which the foundation holds a qualifying ownership interest or over which it exercises control.[1]

The practical message: Companies should begin their reassessment in 2026 rather than treat the reform as a filing exercise for July 2027. Family-held groups and foundation-owned businesses should give particular attention to voting pools, reserved rights, beneficiary arrangements and the information that must move through their ownership chains.

Key Takeaways

• Exactly 25% will count. The general ownership threshold changes from the German rule of "more than 25%" to "25% or more." The AMLR does not introduce a universal 15% threshold.[2]
  
  
• Indirect ownership requires a fresh calculation. Interests are generally multiplied along ownership chains and aggregated across chains. Separate rules apply where ownership and control coexist at different levels; a mathematical result below 25% is not necessarily decisive.[3]
  
  
• Control remains an independent route. Acting in concert, relevant veto rights, appointment rights and, depending on the circumstances, family relationships can establish beneficial ownership without a qualifying economic stake.[4]
  
  
• A foundation's beneficial ownership can flow downstream. Where a foundation (Stiftung) holds a qualifying ownership interest in, or controls, a company, the foundation's natural-person beneficial owners are also identified as beneficial owners of that company.[5]
  
  
• The register will require more information and stronger processes. Expanded personal and structural data, prompt change notifications, annual verification and standardized EU filing formats should be built into the implementation project.[6]

A New EU Rulebook, Not a New German Register

The AMLR harmonizes substantive beneficial ownership requirements directly across the EU. Directive (EU) 2024/1640 (AMLD6) separately governs national central registers, verification powers and access. Germany's Transparency Register (Transparenzregister) is already a full register (Vollregister); companies should not assume that entries in the Commercial Register satisfy their separate transparency obligations. Nor does the reform replace national registers with one EU filing destination.[7]

Germany's implementation legislation remains a developing element of the framework. The Federal Ministry of Finance published a ministerial draft on October 28, 2026, proposing to replace the GwG with a new Money Laundering Combating Act (Geldwäschebekämpfungsgesetz). The proposal should be distinguished from enacted law. The analysis below distinguishes existing German duties from the adopted EU rules scheduled to apply in July 2027.

Ownership: Lower Entry Threshold and Revised Calculation Logic

Direct interests. Under section 3(2) GwG, a natural person generally qualifies through ownership or voting rights exceeding 25%, or through comparable control. Article 52(1) AMLR instead includes direct or indirect ownership of 25% or more of shares, voting rights or other ownership interests, including rights to profits, other internal resources or the liquidation balance. A capital-only review will therefore be insufficient.[8]

Example 1: Four equal shareholders. Four individuals each hold 25% of a GmbH's shares and votes. Assuming no other control arrangements, none qualifies under the current German percentage test solely because of that holding. Under the AMLR, all four qualify through ownership. Current control and fallback rules must nevertheless be considered separately.[9]

Indirect interests. Current German law principally looks for control of an intermediate entity holding the relevant stake. The AMLR adds an express multiplication-and-aggregation methodology: Multiply the interests along each chain, then add the results of the relevant chains. Interests must be considered at every ownership level, subject to Article 54's mixed ownership/control rules.[10]

Example 2: No majority at the intermediate level. An individual owns 50% of Holding GmbH, which owns 50% of Target GmbH. Assuming no special control rights, the individual's indirect interest in Target GmbH is 50% × 50% = 25%. The individual qualifies under the AMLR even without controlling Holding GmbH. The bare 50% holding would not, by itself, establish the controlling influence over Holding GmbH required by the current German indirect-control approach.[11]

Example 3: Separate chains must be combined. An individual owns 40% of Holding A and 40% of Holding B. Holding A owns 40% of Target; Holding B owns 30% of Target. Assuming ordinary proportionate rights and no additional control arrangements, the indirect interests are 16% and 12%, producing an aggregate 28%. The individual qualifies through ownership even though neither chain, viewed alone, reaches 25%.[12]

Multiplication is not the whole analysis. Article 54 identifies both individuals who control entities holding qualifying interests in the target and individuals with qualifying interests in entities that control the target. For example, an individual holding 30% of Holding GmbH, which holds 60% of Target's shares and votes, has a calculated indirect economic interest of only 18%. Nevertheless, the individual qualifies under Article 54(b): The individual has a qualifying ownership interest in a company that controls Target. Conversely, an individual controlling a holding company that owns 40% of Target can qualify under Article 54(a), despite a diluted economic interest below 25%.[13]

Potential high-risk thresholds. Article 52(2) permits lower thresholds for specified higher-risk corporate categories through Commission-delegated acts. The prescribed lower threshold is generally no more than 15%, although a higher threshold below 25% may be adopted if more proportionate. The Commission's assessment is due by July 10, 2029. This mechanism is not a general reduction to 15% for all German companies in July 2027.[14]

Control: Voting Pools, Veto Rights and Family Influence

The AMLR requires control through other means to be assessed independently of and in parallel with ownership. Identifying a majority shareholder does not end the inquiry.[15]

Article 53(3) expressly covers the ability to exercise a majority of voting rights, including where shared by persons acting in concert; appoint or remove a majority of the relevant board or governing body; exercise relevant veto or decision rights attached to shares; or take decisions concerning profit distributions or shifts in assets. Article 53(4) adds a fact-sensitive assessment of formal or informal agreements, family relationships and nominee arrangements.[16]

For family-held companies, this requires a review of how decisions are actually made, not merely who appears on the shareholder list. If a voting arrangement gives three siblings holding 20% each joint control of a majority, they cannot be excluded from the control analysis simply because each holds less than 25%. Equally, kinship alone does not require the aggregation of all relatives' holdings or the reporting of every family member. The relevant question is whether the relationships or arrangements confer control in the circumstances.[17]

Relevant veto rights are expressly included, but the statutory qualifier "relevant" matters. A minority-protection provision should not automatically be equated with control without examining its scope and effect. Companies should assess reserved matters, distribution rights, asset-disposal rights and appointment powers against the AMLR's standard of the ability to exercise significant influence. Comparable control and shareholder agreements are already relevant under the GwG; the EU reform makes the categories more explicit and requires a renewed assessment, rather than introducing all non-equity control concepts for the first time.[18]

Foundations: Role-Based Identification and Downstream Attribution

Article 57 provides a separate, role-based regime for foundations and other legal entities similar to express trusts. Beneficial owners include the natural-person founders, members of the management body in its management and supervisory functions, beneficiaries subject to Article 59, and any other natural person exercising direct or indirect control. Where a legal entity occupies one of the specified positions, its beneficial owners must also be identified. This is not a 25%-of-foundation-assets test.[19]

Compared with section 3(3) GwG, the express inclusion of founders and the supervisory function warrants particular attention. Foundations should classify their governing bodies by function and assess supervisory councils, advisory bodies and reserved powers rather than rely solely on their German titles.[20]

Identifying beneficiaries requires care. If beneficiaries have not yet been determined, Article 59(1) permits identification of the class and its general characteristics; individuals become beneficial owners when identified or designated. Article 59(2)(c) allows class-only treatment for certain nonprofit or charitable structures where the Member State has reached the required low-risk conclusion following an appropriate risk assessment. Charitable status alone is therefore not an automatic exemption.[21]

The portfolio-company consequence is material. Under Article 55, where a foundation holds, individually or cumulatively, a qualifying ownership interest in a company, or controls it directly or indirectly, the foundation's natural-person beneficial owners are also the company's beneficial owners. In the ordinary case, the ownership limb requires a stake of at least 25%; a smaller stake may still be relevant through control.[22]

Example 4: A foundation's 40% portfolio investment. A private foundation holds 40% of Portfolio GmbH. Its Article 57 beneficial owners include its founder, management and supervisory members, and designated individual beneficiaries, as applicable. Article 55 carries those natural persons through to Portfolio GmbH. It is not necessary for each person to control Portfolio GmbH individually or have an individual economic entitlement equivalent to 25% of its shares. The company cannot stop its inquiry at the foundation's legal ownership.[23]

A change in a foundation's reportable officeholders or beneficiaries may consequently require a reassessment and update at portfolio-company level, even though the foundation's shareholding remains unchanged. The foundation and affected companies should establish a shared notification process.[24]

Reporting: More Data, Prompt Updates and Annual Verification

Existing duties continue. Section 20 GwG already requires covered entities to obtain, retain, update and promptly report beneficial ownership information. Beneficial owners and relevant shareholders have corresponding information duties. Existing omissions or errors should be corrected under current law, not deferred until the AMLR applies.[25]

Under Articles 62 and 63 AMLR, the principal changes include:

• Expanded identification data: all first names and surnames, place and full date of birth, residential address, country of residence, nationalities, identity-document number and, where available, a unique personal identification number, with the required description of the sources of those numbers.
  
  
• Interest and structure information: the nature and extent of the interest, its commencement date and, for multi-entity structures, a description identifying the entities or arrangements, their relationships and ownership percentages.
  
  
• Timing and review: initial collection within 28 calendar days of formation, with submission to the central register without undue delay after formation; subsequent changes must be notified without undue delay and in any event within 28 calendar days. Information must be verified at least annually. The outer deadline is not permission to delay a filing that can be made sooner, and annual verification is not a blanket requirement to refile an unchanged declaration.
  
  
• Documented fallback: where no beneficial owner is identified after exhausting the prescribed means, or substantial and justified doubts remain, the entity must document its efforts and submit a reasoned statement with details of all relevant senior managing officials. Those officials are not simply deemed substantive beneficial owners in the manner of the current German fallback.[26]

An important October 2026 development: Commission Implementing Regulation (EU) 2026/2354, adopted on October 16 and published on October 22, establishes common submission formats and minimum acceptance requirements, applicable from July 10, 2027. These include structured descriptions of ownership and control, with an ownership/control representation or appropriate structured submission for layered structures. The transition to these formats should not be confused with a blanket requirement to resubmit every pre-existing entry solely because the format changes or with an exemption from reporting actual changes in beneficial ownership.[27]

AMLD6 requires stronger register verification, document-request and inspection powers, subject to safeguards. Register access remains separately regulated: Tthe expanded collection of personal data does not make every data field publicly available. Some register-access provisions had an earlier national transposition deadline of July 10, 2026; that date does not accelerate the AMLR's new ownership definition.[28]

Finally, a company's own notification duties must be distinguished from discrepancy reporting by AML-regulated obliged entities, such as banks. Article 24 AMLR generally requires those entities to report discrepancies without undue delay and within 14 calendar days of detection, subject to specified correction routes and exceptions. It is not the general deadline for a company's own change notification.[29]

What Companies, Family Groups and Foundations Should Do Now

During the remainder of 2026:

• Appoint a legal or compliance owner for the transition and reconcile existing Transparency Register entries with current ownership, governance and beneficiary records. Correct current-law deficiencies immediately.
  
  
• Identify holders of exactly 25%; recalculate indirect interests across all relevant chains; and separately test mixed ownership/control arrangements. Retain the calculation and the legal basis for each conclusion.
  
  
• For family groups, collect voting-pool agreements, shareholder arrangements, powers of attorney, nominee arrangements and evidence of actual decision-making. Review vetoes and reserved matters individually rather than apply blanket assumptions about minority rights or family membership.
  
  
• For foundations, inventory founders, management and supervisory functions, controllers and designated beneficiaries or classes. Identify portfolio companies affected by Article 55 and establish responsibility for passing changes downstream.

In the first half of 2027:

• Complete data-gap remediation against Articles 62-64 and the adopted filing formats, including full addresses, identity-document details, interest commencement dates and ownership/control documentation. Handle sensitive personal data through appropriately restricted processes.
  
  
• Update shareholder and beneficiary questionnaires, appointment and succession procedures, transaction checklists and contractual information undertakings so that changes are escalated promptly through the group.
  
  
• Establish event-driven updates and an annual verification cycle, with evidence of review and a mechanism for responding to bank inquiries and discrepancy notices.
  
  
• Monitor the German implementing legislation, official register instructions and any further EU measures. Confirm filing and transition arrangements before July 10, 2027, rather than assume that a current register entry remains correct under the new definition.

Bottom line: The reform changes both who must be identified and how that conclusion must be supported. A coordinated ownership, governance and data review is the most effective preparation, particularly where family arrangements or foundations sit above operating companies.

This alert reflects publicly available materials reviewed as of November 11, 2026. It provides general information and is not advice on any particular structure. Examples are hypothetical and assume proportionate ordinary shares and votes except where stated. Proposed German legislation and structure-specific classifications require continued monitoring.

This communication is for general information only. It is not intended, nor should it be relied upon, as legal advice. In some jurisdictions, this may be considered attorney advertising. Please refer to the firm's data policy page for further information.