Strengthened Obligations in the Transparency Register Call for More Disclosure

Strengthened Obligations in the Transparency Register Call for More Disclosure

In August 2025, Germany will enforce expanded reporting requirements for its Transparency Register, targeting foreign companies and various sectors, including real estate, financial, and insurance intermediaries [1]. The aim is to enhance transparency and combat money laundering, following measures initiated by the European Union.

The Transparency Register is designed to identify the economically beneficial owners of German companies. Each obliged person is responsible for making the entry and ensuring its accuracy. Businesses must report beneficial ownership information to meet stricter anti-money laundering and transparency standards [1].

Foreign companies indirectly or directly owning real estate or shares in entities with real estate in Germany, with a minimum 90% shareholding, will trigger reporting duties [1]. To comply across sectors, businesses need to:

1. Identify and disclose their beneficial owners by registering them with the Transparency Register.
2. Ensure compliance with newly broadened obligations, especially for foreign entities holding stakes in German real estate or involved in investment chains [1].
3. Maintain diligent record-keeping and meet due diligence requirements, as non-compliance may lead to notarization refusals for real estate transactions and other legal restrictions.
4. For financial intermediaries, align with additional relevant regulations such as those enforced by BaFin (Federal Financial Supervisory Authority), which oversees financial market participants and ICT third-party providers, and impose fines or sanctions for regulatory violations [4].
5. Monitor upcoming related regulations, for example, crypto-asset reporting requirements under DAC8 starting January 2026, which impose further transparency measures on crypto service providers [3].

Businesses across all sectors should consult legal and compliance experts to integrate these requirements into their operational and reporting structures proactively. Employing services that specialize in legal entity setup, payroll, and compliance in Germany can simplify meeting these burdens [2].

It's essential to note that legal entities under private law and registered partnerships, such as stock corporations (AG), limited liability companies (GmbH), general partnerships (OHG), limited partnerships (KG), GmbH & Co. KG, registered cooperatives, and foundations, are subject to this obligation [5]. Companies must register on the website www.transparenzregister.de to submit the required information [6].

Transition periods have been granted for existing companies. For instance, AG, SE, and KGaA have until March 31, 2022, to make the notification, while GmbHs, cooperatives, European cooperatives, and partnerships have until June 30, 2022 [5]. The Transparency and Financial Information Act (TraFinG) will come into force starting August 1st [7].

Violations of the reporting obligation can result in fines of between 50 and 100,000 euros, with higher fines for persistent violations [8]. Brokerage firms should check whether they have already deposited all the necessary information with the Transparency Register [8]. Economically beneficial owners are natural persons who hold more than 25% of the capital shares or voting rights, or exercise comparable control [9]. In a stock corporation or a limited liability company, if no specific person fits the criteria, the board members or managing directors are considered the fictitious economically beneficial owners [9].

In summary, from August 1, 2025, Germany demands expanded and stricter reporting of beneficial ownership via the Transparency Register—covering foreign companies with real estate and extending to multiple sectors—to enhance transparency and combat money laundering. Compliance involves registering ownership information, instituting rigorous due diligence, and staying current with broader supervisory requirements [1][3][4].

1. Foreign companies participating in the German real estate market, as well as other financial and insurance intermediaries, should be aware of the expanded reporting requirements for the Transparency Register as of August 2025.
2. In order to meet the stricter anti-money laundering and transparency standards, businesses from various sectors must proactively identify and disclose their economically beneficial owners, ensuring compliance with the Transparency Register and related regulations.

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