Category: Financial Crime

Sanctioned Russian Oligarch wins right to use yacht on the French Riviera

A sanctioned Russian oligarch has won the right to use his yacht on the French Riviera. Rather, he has successfully challenged French customs due to a number of errors made in the procedure when they boarded the yacht.

Originally published in 2022, this article discusses the legal complexities around asset control and EU sanctions. As of 2025, such cases remain highly relevant in the evolving landscape of international law and yacht management.

The EU sanctions apply across EU member states. French customs authorities are reported to have failed to follow the correct procedures. The court ordered the release of the yacht.

Read the article here.

A superyacht lies at anchor. Image taken from stock - (C) Shutterstock
A superyacht – image from stock.

Legal professionals from different parts of the world have argued that individuals facing such sanctions should succeed in these challenges. Assets are being seized without due process of law. Further, these seizures are taking effect without following any proper court process.

Clearly, there could be a deprivation of the right to one’s own property, without the proper court case to establish whether anyone has committed a crime.

These actions, merely on the basis that an individual has links to (in this case) the Russian government, appear to constitute a right about turn from the fundamental human right to property. This is arguable. The use of wealth to continue to back up the atrocities of war remains worrying. Sanctions of this type might be the only way to stop this practice.

Asteria Advisory’s services include ship & yacht registration, and management & representatation for yachts. We also provide legal support on a more general basis.

Companies Act – Register of Beneficial Owners

On the 1st January 2018, new regulations came into force setting up the register of beneficial owners within the Registry of Companies.  Companies must declare the identity of the ultimate beneficial owners (UBOs).  This applies for UBOs having a share or controlling interest of more than 25%. If there are none, then the company has to indicate who the senior administrators are.

The regulations exclude companies where:
  1. They are listed on a regulated market and disclosure of beneficial owners is already required under the appropriate regulations; or
  2. All shareholders are natural persons disclosed to the companies registrar.

The First Schedule of the regulations sets out a form which is to be delivered together with the M&As whenever a new company is being set up. Declarations must be submitted for each beneficial owner. The declarations must include name, date of birth and nationality, identification details and country of issue of the passport or identity document.  Failure to comply means that the Registrar will not register the company.

The regulations require the Registrar to keep a register for information on the beneficial owners.  The information is not available to the general public except under payment of a fee to download the documents.

Update – December 2023:

A recent European court judgement has confirmed that having this information accessible by the general public is not strictly necessary or proportionate in terms of human law rights and thus, the ability to access beneficial owners’ information has now been limited to licensed entities and subject persons.  Read the article here.

Companies must retain accurate, adequate and up to date information on all beneficial owners in compliance with the regulations.  They must hold this information in a beneficial owners register which they keep at the company’s registered office.

Shareholders and UBOs are bound to provide the information without delay, even upon any change in the beneficial ownership or interest held.  New shareholders shall not be registered unless they comply with this requirment.

Any changes in beneficial ownership must be notified to the registry within fourteen days.  Companies must use the prescribed Form including all the information necessary.  The same applies in the case of a transfer or transmission of shares, where this has entailed a change in beneficial ownership interest held.  Notices of changes must be signed by at least one director or the company secretary.

Power of Authorities

The registry is authorised to exchange the information with tax and other competent authorities as well as to subject persons carrying out CDD in terms of the applicable regulations.  Subject persons requesting such information may demonstrate their legitimate interest in obtaining such information, including on the basis of previous activities and proven track record.  (Note – this might cause problems for new start-ups).

In exceptional cases where the beneficial owner risks exposure to harm owing to  disclosure, such information should not be disclosed.  Subject persons cannot rely exclusively on the register for CDD purposes.  Furthermore, authorities across the EU will have the power to exchange information with each other.

Submission and Liability to fines for default

The rules subject access to information to online registration and a fee of EUR 5.00 for every access to the information on the beneficial owners of each company. Post 2022, this information is only accessible to subject (licensed) persons.

Default will expose every beneficial owner, shareholder, officer and the company jointly and severally to fines.  Officers can only escape this where they have used all due diligence in order to comply with the rules and was not at fault for the failure.

This information is to be provided at every anniversary of each company after the initial submission.  Notably, the rules also apply to commercial partnerships.

False or misleading statements can lead to hefty fines and / or imprisonment.  The rules make provision for electronic submission. This enables subject persons to submit documents on time.

The Second Schedule lists down the applicable administrative penalties for failure to submit on time.

Anti-Money Laundering – New Rules in Force

The Fourth Anti-Money Laundering Directive (AMLD 4) aims to strengthen the integrity of the EU’s financial system by combating money laundering and the financing of terrorism.  AMLD 4 relies on the principle that illicit financial flows can damage not just the Member State concerned, but the stability and reputation of the entire EU financial sector.

The evolution of financial crime

Financial crime has become more sophisticated over time, often involving international networks. This has made tighter controls and increased coordination across jurisdictions more important than ever. The EU’s approach aligns closely with international standards, including those set by the Financial Action Task Force (FATF).  

Key Objectives of AMLD 4

One of the core goals of AMLD 4 is to improve transparency by ensuring that the beneficial ownership of companies is identified and recorded. This means tracing the ownership structure to the individual who ultimately owns or controls the entity. The Directive mandates that this information must be accurate, up-to-date, and easily accessible to competent authorities  

Key Aims of Anti-Money Laundering Legislation

Identifying the beneficial owner is key to avoiding would-be criminals from hiding behind a corporate structure.  This is the raison-d’etre behind the due diligence and other obligations underlying the Directive.

The aim is to look for the individual (natural) person at the very end of the line. Information needs not only be adequate and accurate, but also up-to-date, which is why certain checks need to be repeated regularly.

Main changes in AMLD 4

  • Less Reliance on Simplified Due Diligence: Simplified Customer Due Diligence (CDD) is now only allowed in limited cases. Entities must demonstrate low risk before applying reduced checks—and must continue to monitor the relationship.

  • Enhanced Due Diligence (EDD): Required for high-risk clients, such as asset-holding vehicles, cash-intensive businesses, and transactions involving high-risk jurisdictions.

  • Wider Scope of Politically Exposed Persons (PEPs): The definition now includes individuals in domestic public positions, not just foreign ones. All PEPs are automatically subject to EDD.

  • Central Beneficial Ownership Registers: Companies must maintain beneficial ownership information in a register accessible to national authorities like the MFSA and FIAU in Malta.

  • Lower Transaction Thresholds: The threshold for triggering CDD for cash transactions has been reduced from €15,000 to €10,000. For high-risk gambling operations, the threshold is as low as €2,000.

  • Gambling Sector Inclusion: The entire gambling sector now falls under AMLD 4, not just specific areas, and subject persons must apply CDD when applicable.

  • Tax Crimes as Predicate Offences: Tax offences are now clearly predicate offences across all EU jurisdictions.  This harmonises definitions and enables Member States to better enforce the AMLD 4 rules.

  • Increased National Oversight: Member States must perform their own national risk assessments.  This could may lead to Member States introducing stricter national requirements.

Malta’s Implementation

On 20 December 2017, Malta adopted the Prevention of Money Laundering and Funding of Terrorism Regulations, 2017, in line with AMLD 4. These regulations repealed the 2008 rules and introduced risk-based CDD as the standard approach.

Although the FIAU is revising the Implementing Procedures (Part I), entities are advised that in case of conflict between this document and the regulations, the 2017 regulations will take precedence.

Final Thoughts

AMLD 4 marks a significant shift in the EU’s AML framework. By focusing on transparency, harmonisation, and a risk-based approach, AMLD 4 aims to make financial systems more resilient to abuse. Malta’s regulatory framework continues to evolve to meet these standards, reinforcing its commitment to compliance and integrity in financial services.