Article 59 Identification of a class of beneficiaries

This article deals with a specific practical challenge that arises under Articles 57 and 58: what happens when the beneficiaries of a trust or similar legal arrangement have not yet been identified or designated?

Rather than leaving a gap in beneficial ownership transparency, Article 59 provides a workable interim rule — identify the class of beneficiaries and its general characteristics, with individual beneficiaries becoming beneficial owners the moment they are identified or designated.

The article also carves out a limited set of situations where identifying only the class is sufficient on a permanent basis, such as pension schemes and low-risk non-profit or charitable structures, subject to Member State risk assessments.

Important points:

• Trustees and persons holding equivalent positions in trusts or similar legal arrangements must identify the class of beneficiaries and its characteristics where individual beneficiaries are not yet determined, and treat each beneficiary as a beneficial owner as soon as they are identified or designated.
• A reduced obligation — identifying only the class of beneficiaries — applies permanently to pension schemes, employee financial participation schemes assessed as low risk, and non-profit or charitable structures assessed as low risk, with Member States responsible for conducting the underlying risk assessments.
• Member States are required to notify the Commission of the categories they place under the reduced obligation, accompanied by a justification based on their risk assessment, and the Commission must share these notifications with other Member States.