ARE YOU AWARE OF WHAT THE UNIQUE BENEFICIAL OWNERS REPORT CONSISTS OF AND THE DEADLINES TO SUBMIT THE INFORMATION TO THE COLOMBIAN TAX AUTHORITY (DIAN)?

  • The Unique Beneficial Owners Report (RUB) is a registry that must be completed by all Colombian legal entities, non-legal entity structures, or similar entities in order to identify the individuals acting as their final beneficial owners. In this context, the final beneficial owner is not limited to those who obtain an economic benefit from the entity, but also includes those who exercise control over the entity.
  • An individual is considered to exercise control over a legal entity when it has the capacity to make or impose significant decisions in the management or direction of the entity. There is no restriction on the number of final beneficial owners that an entity may have. Any individual who meets the criteria can qualify as a final beneficial owner. The criteria are not mutually exclusive and may coexist. In other words, an individual can be considered a final beneficial owner if it meets one or more of the specified criteria.
  • Domestic companies are required to conduct due diligence in order to identify all individuals who directly or indirectly hold more than 5% of the entity’s capital or voting rights, and/or who are entitled to more than 5% of the assets or profits. In addition, those who exercise control over the entity through other means than ownership or benefit must also be included.
  • If, after conducting the due diligence, no individuals meets the criteria or it is not possible to obtain this information from the shareholder(s), the individual who holds the position of legal representative of the Colombian company, or who holds greater authority in relation to the management or direction functions of the entity, must be reported as the final beneficial owner.
  • The submission of information in the Unique Beneficial Owners Registry (RUB) follows the same process as submitting exogenous information through magnetic media, before the tax and customs administration (DIAN). Therefore, we recommend that you coordinate this matter with the person in charge for this function in the company. To do so, please access the official web page of the DIAN using the company’s credentials and follow the provided instructions. The information to be reported should be updated as of the date of conducting the due diligence. For instance, if the information is uploaded on June 25th, it should reflect the current information as of that date. Similarly, if it is uploaded on July 21st, it should reflect the current information as of that date, and so on.
  • It is important to note that neither the law nor the resolution issued by the DIAN define clearly the exact process of conducting a due diligence to obtain the required information. In fact, this matter was brought to the attention of the Legal Office of the DIAN, but no clarification or definition was provided. Hence, the most crucial aspect is to maintain evidence of official communications sent to the shareholders requesting the information, as well as the responses received from them, whether they provide the information or explain their inability to do so. In this way, the company will be able to at least register the information of the legal representative of the Colombian company or the individual exercising the highest authority within it. This will help prevent the DIAN from alleging non-compliance with the obligation to submit the RUB within the established deadline (July 31st, 2023), which could lead to the sanctions stipulated in Article 658-3 of the Colombian Tax Statute.
  • Should you require any guidance or assistance in fulfilling this obligation, please let us know.