(Ne)vynutitelnost sankcí dle zákona o evidenci skutečných majitelů

In its ruling No. 27 Cdo 1368/2024 dated 25 August 2025, the Supreme Court of the Czech Republic confirmed that part of Czech Act No. 37/2021 Coll., on the Register of Beneficial Owners, as amended (the "Act"), which grants the general public access to information about beneficial owners, conflicts with EU law. As a result, the state cannot impose and enforce sanctions for the failure to register beneficial owners.

In the respective case, lower courts ordered the registering entity to remedy the missing entry in the Register of Beneficial Owners. The affected entity refused to do so, citing the privacy protection of the individuals who were to be listed in the Register of Beneficial Owners. According to the appellate court, the registering entity failed to comply with its legal obligation and the absence of registration in the Register constituted a discrepancy within the meaning of Section 2(l) of the Act. The concerned entity appealed to the Supreme Court.

The Supreme Court granted the appeal, emphasizing that the Act transposes Directive (EU) 2015/849 of the European Parliament and of the Council, the provisions of which regarding unrestricted public access to information about beneficial owners were declared invalid by the Court of Justice of the EU in the joined cases WM and Sovim. The Czech legislature has not yet reflected the conclusions of the Court of Justice, nor has it adopted an amendment limiting public access to the Register and align the Act with EU case law and the new AML Directive 2024/1640/EU.

The ruling follows the previous case law of the Supreme Administrative Court, which has repeatedly pointed out that blanket public access to information about beneficial owners may lead to an infringement of the constitutionally guaranteed rights of the persons concerned.

The current Czech legal framework thus places registering entities in a difficult position. On the one hand, it imposes an obligation to register beneficial owners, while on the other hand, compliance with this obligation results in the automatic disclosure of information to the general public, which may represent a disproportionate interference with the fundamental rights of beneficial owners regarding privacy and personal data protection. The Supreme Court concluded that until the Act is amended in accordance with EU law, the state cannot enforce the obligation to register and maintain current data about the beneficial owners of legal entities and trusts in the Register of Beneficial Owners.

The same conclusions apply in the case of the suspension of voting rights of an unregistered beneficial owner. This conclusion was confirmed by the Supreme Court in its most recent ruling No. 27 Cdo 1548/2024 dated 26 August 2025. According to the court, the invalidity of a general meeting's resolution cannot be invoked solely because it was adopted with the votes of the beneficial owner whose voting rights were suspended under the Act due to the failure to fulfill the registration obligation. The court justified its conclusion by the persisting misalignment of the Act with EU law. A similar approach can thus be expected with respect to other private law sanctions established by the Act.

At the same time, it is essential to emphasize that, despite the current case law, the absence of registration in the Register of Beneficial Owners may have negative consequences in commercial practice, particularly concerning obliged entities under AML regulations, where it remains unclear whether and to what extent the above case law will be reflected in their practice.

Authors:

Petra Dobravská

Andrea Musilová