The stakeholders in your organization include legal representatives and Ultimate Beneficial Owners (UBOs). In some companies, a Pseudo-UBO might be a stakeholder. To use our services, we ask you to submit and verify some of your information about these stakeholders.
In this article, you will find examples to help you figure out who the stakeholders are in your Association.
Legal representatives for an Association
A legal representative is a natural person who is authorized to act on behalf of your organization.
In the case of an Association, the legal representatives may be:
- A solely authorized director, or;
- Multiple directors who are jointly authorized, or;
- Attorneys who are authorized with a power of attorney, either solely or jointly with directors.
Ultimate Beneficial Owners for an Association
An Ultimate Beneficial Owner (UBO) owns or significantly controls an organization. A company or legal entity can have one or more UBOs. Note that a UBO is always a natural person, though this person may have a direct or indirect stake in the company.
You can identify a UBO as:
- Persons who have over 25% entitlement to capital, or;
- Persons with over 25% voting rights, or;
- Persons with effective control through other means.
Persons who have over 25% entitlement to capital
In an association, any persons who are entitled to more than 25% of the capital can be designated as UBOs.
As an example, the statutes for the Enjoyable Music Society state that Charlotte is entitled to the profits from the society’s activities. Because of this right to profit, Charlotte is entitled to more than 25% of the capital, which makes her a UBO for the society.
In a different example, the articles of association for the Fun Bowling Club state that 8 people in the club are entitled to profits. All these persons are entitled to less than 25% of the capital, so none of them are a UBO to the club.
Persons with over 25% voting rights
A UBO can also be someone who has over 25% of the voting rights in the organisation.
For example, in a club with 90 members, only the club’s manager has multiple voting rights that equal 35%. Since she has more than 25% voting rights, the manager is the UBO for the club.
Persons with effective control through other means
Persons may be designated as UBOs if they have ownership or control of the company via means other than voting rights. Other means may include being the ultimate policymaker.
For example, Will is the only member who finances the Simple Association. He does not have a formal role in the association, but acts as an external stakeholder. In this case, Will is a UBO for the Simple Association based on effective control.
Do none of these interests apply to your company?
If your organization does not have a UBO, you should identify one or more pseudo-UBOs. A pseudo-UBO is a natural person who belongs to the senior management of an organization like a managing director. These managers must be registered in the Commercial Register as statutory directors. They can be considered Pseudo-UBOs because they fulfill the function of a director.