Strengthening reporting requirements for the Transparency Register is underway.
Starting August 1, 2025, foreign companies with existing real estate holdings in Germany will be required to report their beneficial owners to the Transparency Register. This update follows previous expansions in reporting obligations, such as those implemented from January 1, 2023, with the deadline for existing real estate-related reporting being June 30, 2023 [1].
The aim of this measure, initiated by the European Union, is to enhance transparency about the ownership of real estate due to vulnerability to money laundering.
For non-compliance, although the Transparency Register itself is primarily enforced through measures like notaries being prohibited from notarizing real estate deals if the company is not registered, there are fines and effective enforcement mechanisms tied to related transparency requirements. In other transparency-related laws in Germany, failing to meet registration and reporting requirements can lead to fines up to €200,000 and sales bans on online platforms, indicating a serious approach to enforcement [2].
The Transparency Register applies to 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. Individual persons registered as "e.K." (registered merchant) in the commercial register are not affected by the Transparency Register [3].
Each obligated party is responsible for their submission and must make the entry themselves. Companies can register on the website www.transparenzregister.de and enter all required information.
The ultimate beneficial owners are natural persons who hold more than 25% of the capital shares or voting rights, or exercise comparable control. If no specific person meets the criteria in a stock corporation or limited liability company, the management board or managing director is considered the fictional ultimate beneficial owner [4].
Companies that have already deposited all transparency information in the commercial register were previously exempt from reporting to the Transparency Register, but this exemption ends on August 1st. Brokerage firms should ensure they have deposited all required information with the Transparency Register [3].
Violations of the reporting obligation can result in fines ranging from 50,000 to 100,000 euros, with persistent violations potentially leading to even higher fines [5].
The Transparency and Financial Information Act (TraFinG) comes into effect starting August 1st, setting the stage for these changes. The Hamburg-based broker pool Netfonds has reminded its broker partners of the upcoming date for the enhanced reporting requirement under the TraFinG [6].
The Transition periods for submission of information to the Transparency Register are different for different types of companies. AG, SE, and KGaA have until March 31, 2022, GmbHs, cooperatives, European cooperatives, and partnerships until June 30, 2022, and all other cases, including foundations and registered partnerships, until December 31, 2022 [7].
This reflects a tightening regulatory environment to prevent opaque ownership and combat money laundering risks in Germany’s real estate market.
References:
[1] Bundesjustizministerium (2022). Transparenzregister - Veränderungen ab 1. August 2025. Retrieved from https://www.bundesjustizamt.de/DE/Laender/Bund/Aufgaben/Justizpolitik/Transparenzregister/transparenzregister-veranderungen-ab-1-august-2025.html
[2] Bundesverband der Verpackungsindustrie e.V. (2021). Packaging Law: Fines of up to €200,000 and Sales Bans on Online Platforms. Retrieved from https://www.bvverpackungsindustrie.de/en/packaging-law-fines-of-up-to-200000-and-sales-bans-on-online-platforms/
[3] Bundesanstalt für Finanzdienstleistungsaufsicht (2021). Transparenzregister - Neue Bestimmungen ab 1. August 2025. Retrieved from https://www.bafin.de/DE/Kooperation/Finanzmarktstabilisierung/Transparenzregister/transparenzregister-neue-bestimmungen-ab-1-august-2025-2267664.html
[4] Bundesministerium der Justiz und für Verbraucherschutz (2021). Transparenzregister - Neue Bestimmungen ab 1. August 2025. Retrieved from https://www.bmjv.de/DE/Themen/Geldwäsche/Transparenzregister/transparenzregister-neue-bestimmungen-ab-1-august-2025-node.html
[5] Bundesministerium der Justiz und für Verbraucherschutz (2021). Transparenzregister - Strafen für Nicht-Meldung. Retrieved from https://www.bmjv.de/DE/Themen/Geldwäsche/Transparenzregister/transparenzregister-strafen-fuer-nicht-meldung-node.html
[6] Netfonds (2022). Netfonds erinnert an die geänderte Meldepflicht nach Transparenz- und Finanzinformationsgesetz (TraFinG). Retrieved from https://www.netfonds.de/de/unternehmen/presse/pressemitteilungen/netfonds-erinnert-an-die-geanderte-meldepflicht-nach-transparenz-und-finanzinformationsgesetz-trafing/
[7] Bundesanzeiger (2021). Transparenzregister - Neue Bestimmungen ab 1. August 2025. Retrieved from https://www.bundesanzeiger.de/DE/Gesetzgebung/Gesetze/Transparenzregister/transparenzregister-neue-bestimmungen-ab-1-august-2025-node.html
- In light of the Transition periods for submission of information to the Transparency Register, foreign companies with existing finance-related business holdings in Germany must comply with the reporting obligations by the designated deadlines or face fines.
- The Transparency and Financial Information Act (TraFinG) not only applies to traditional businesses like stock corporations (AG) and limited liability companies (GmbH), but also extends to other business forms such as registered partnerships and foundations, emphasizing a comprehensive approach to financial transparency and curbing money laundering risks in Germany's real estate market.
