The aforementioned amendments to legal acts, which came into effect on August 1, stipulate that legal entities that have started to carry out one of these activities must notify the administrator of the Register of Legal Entities, i.e. the Center of Registers, within 5 working days of the start of the activity. Companies that carried out these activities before the entry into force of the law, i.e. on August 1 of this year, must notify the Register Center no later than December 1 of this year.
“We urge legal entities that carry out one or more of these activities and have not yet informed about it, to hurry to do so. This information will help to better ensure the prevention of money laundering and terrorist financing, increase transparency and mutual trust”, says Jolanta Kazlauskienė, head of the Center for Registration of Persons at the Register Center.
She reminds that administrative responsibility may be applied if the data is not provided, in addition, the institutions responsible for the prevention of money laundering, having determined that such an obligation has not been fulfilled, could apply the enforcement measures within their competence.
Natural persons also have a similar obligation to report on one or more specified activities – they must report it to the State Tax Inspectorate (VMI).
Audrius Valeika, deputy director of the Financial Crimes Investigation Service (FNTT), says that the changes to the law, which created the obligation for real estate agent (broker), tax consulting, and accounting service providers to declare their activities, were adopted in order to remove the measures of the Council of Europe’s expert committee , aimed at combating money laundering and terrorist financing (MONEYVAL), identified shortcomings in Lithuania.
“It is important to note that having the registers of the mentioned sectors will make it easier for the competent authorities to apply risk-based supervision, manage possible risks and provide methodological assistance in the field of money laundering and terrorist financing prevention,” says A. Valeika.
He points out that by submitting this information, legal entities confirm that they, members of its management or supervisory bodies and beneficiaries are familiar with the legal acts governing the prevention of money laundering and terrorist financing and comply with their requirements.
How to do it?
Until now, legal entities had to notify the Center of Registers about the ongoing activities of a trust service provider, company establishment and administration service provider, virtual currency exchange operator and depository virtual currency wallet operator. Legal entities can report on ongoing activities by filling out the report form JAR-PSA.
The completed form can be submitted electronically through “E. delivery” system, by mail or by personally visiting one of the Customer Service Departments of the Register Center. It should be noted that in order to report several ongoing activities, it is sufficient to submit one application.
In addition, upon termination of activity, the Registry Center must be notified no later than within 5 working days from the end of activity.
According to the data of the Center of Registers, 22 legal entities have already reported on the activities of real estate agent (broker), 87 legal entities on tax consulting activities, 235 legal entities on the activities of an accounting service provider or the performance of accounting functions.
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**Interview with Jolanta Kazlauskienė and Audrius Valeika on Recent Amendments to Financial Reporting Regulations**
**Editor:** Welcome, Jolanta Kazlauskienė, head of the Center for Registration of Persons at the Register Center, and Audrius Valeika, deputy director of the Financial Crimes Investigation Service (FNTT). Thank you both for joining us today. There have been significant changes to the regulations regarding the reporting of certain financial activities. Jolanta, could you explain the key points of these recent amendments that came into effect on August 1?
**Jolanta Kazlauskienė:** Thank you for having us. The amendments require legal entities that engage in specified activities—like real estate, tax consulting, or accounting services—to notify the Register of Legal Entities within five working days of starting those activities. For those who were already conducting these activities prior to the law’s enactment, they must provide this information by December 1. This initiative is vital for preventing money laundering and enhancing financial transparency.
**Editor:** Audrius, why was it deemed necessary to introduce these changes specifically for legal entities in these sectors?
**Audrius Valeika:** The changes were made in response to feedback from the Council of Europe’s MONEYVAL committee. They identified several shortcomings in Lithuania’s approach to combatting money laundering and financing of terrorism. By enforcing this reporting obligation, we aim to rectify those deficiencies and improve our overall risk management and supervision processes.
**Editor:** What are the implications for entities that fail to comply with these new requirements?
**Jolanta Kazlauskienė:** We must stress that there are administrative responsibilities associated with non-compliance. If legal entities fail to provide this information, they risk enforcement actions from authorities tasked with anti-money laundering efforts.
**Audrius Valeika:** Furthermore, by reporting their activities, legal entities demonstrate their understanding of and adherence to the legal frameworks aimed at combating these financial crimes, which aids in building mutual trust and transparency with regulatory bodies.
**Editor:** Regarding natural persons, what obligations do they face under these new regulations?
**Jolanta Kazlauskienė:** Natural persons who engage in certain specified activities must report to the State Tax Inspectorate (VMI). This mirrors the obligation placed on legal entities, reinforcing the idea that both entities and individuals are accountable for reporting relevant financial activities.
**Editor:** Thank you both for your insights. It appears that these amendments are a critical step in fortifying Lithuania’s financial system against potential abuse. Any final thoughts you’d like to share?
**Audrius Valeika:** Yes, we encourage all legal entities to act swiftly. Timely reporting is crucial not just for compliance but for the integrity of our financial landscape.
**Jolanta Kazlauskienė:** Absolutely. The more transparent we are, the more effectively we can combat financial crime. Thank you for highlighting this important issue.
**Editor:** Thank you again, Jolanta and Audrius, for your time and valuable information.
