Disclosing the ultimate beneficial owners does not violate the legal confidentiality of the merchant's records

This requirement must be fulfilled by counterparties without implying access to shareholder registers or other corporate records.

What is the obligation established by Law 2195 of 2022 regarding the disclosure of ultimate beneficial owners?

Law 2195 of 2022, which establishes measures for transparency, prevention, and the fight against corruption, sets forth in Article 12 the principle of due diligence. This principle states that public entities, private legal entities, natural persons, and structures without legal personality that are required to implement SAGRILAFT or to provide information to the Single Registry of Beneficial Owners (RUB)—an obligation arising from tax regulations—must adopt due diligence measures aimed at identifying the ultimate beneficial owners of their counterparties.

These measures must be applied based on the following criteria:

1.  Identify the counterparty to the legal transaction or public contract.

2. Identify the ultimate beneficial owners and the ownership and control structure, reasonably verifying the information.

3. Obtain information about the purpose of the transaction or contract; in the case of public procurement, understand the corporate purpose of the contractor.

4. Continuously monitor the relationship, reviewing that transactions are consistent with the counterparty’s profile, business activity, and the origin of their funds.

Furthermore, the article imposes on the counterparties of the obligated entities the duty to provide the information required of them, in compliance with the principle of due diligence.

It is worth recalling the definition of an ultimate beneficial owner (UBO): any natural person who is the actual owner, controller, or economic beneficiary of a legal vehicle such as a corporation, trust, foundation, or similar structure.

What is the legal confidentiality of the merchant's records?

The legal confidentiality of the merchant’s records is the prerogative that prevents unauthorized third parties from accessing a merchant’s accounting and corporate documents, such as the shareholder registry book. This provision is established in Article 61 of the Colombian Commercial Code and is intended to protect the information contained in a merchant’s books and records, ensuring the confidentiality of business operations and preventing unauthorized access by third parties.

However, this confidentiality is not absolute, as certain exceptions are established by law, such as when there is a judicial order or a request from a competent authority. It is also important to emphasize that this confidentiality does not justify failing to comply with legal obligations, such as the identification of the ultimate beneficial owner under the SAGRILAFT framework.

Does the legal confidentiality established in Article 61 of the Colombian Commercial Code limit the obligation to disclose information about ultimate beneficial owners?

On this matter, the Superintendence of Companies has clearly stated that the legal confidentiality established over a merchant’s books and records applies specifically to the data contained in such documents, including the shareholder registry book.

Accordingly, the purpose of this confidentiality is to prevent these books and records from being reviewed by individuals who are not their owners or who lack proper authorization to access such information. This legal confidentiality, however, does not equate to unrestricted secrecy.

For example, as with the obligation to disclose control relationships under Article 30 of Law 222 of 1995, any natural or legal person exercising decision-making power over a subordinate company is required to register their name in the Commercial Registry to provide public notice to third parties. Nevertheless, such registration does not constitute a waiver of the confidentiality of the shareholder registry book, even if the person is listed as a shareholder of the company. In this context, what is disclosed is the control relationship, not the full content of the shareholder registry.

Similarly, Article 12 of Law 2195 of 2022 expressly establishes the obligation to disclose the ultimate beneficial owner of an operation. This obligation does not, under any circumstance, imply the lifting of the legal confidentiality of the shareholder registry book.

As stated in paragraph 4 of the same article, all counterparties, whether natural persons, legal entities, or structures without legal personality—engaged in business operations with parties obligated to implement SAGRILAFT are legally required to provide the requested information. This follows the principle of due diligence, which seeks to ensure the identification of the ultimate beneficial owner and a proper understanding of the transaction.

Purpose of the Due Diligence Principle

In essence, the principle of due diligence aims to identify and disclose the true identity of the ultimate beneficial owner of the transaction or legal business being carried out. It also imposes the obligation to record the intended purpose or objective of such a transaction.

Accordingly, the due diligence principle emphasizes the need to investigate the origin of the funds supporting the operation, as well as to monitor the transactions carried out during the business relationship, including the destination of the resources involved. All of this is intended to help rule out potential activities related to money laundering, terrorist financing, or the proliferation of weapons of mass destruction.

In conclusion, the Superintendence of Companies has clarified that Paragraph 4 of Article 12 of Law 2195 of 2022 does not modify, replace, or repeal the provisions of Article 61 of the Colombian Commercial Code. Both provisions coexist independently and operate in distinct legal contexts, each with its own scope of application.

How can we assist you?

At Forvis Mazars, we have a team of professionals with deep expertise in applying the due diligence principle, as well as in the design, implementation, execution, and monitoring of the components and stages of the SAGRILAFT system. If you need support in the implementation or compliance with the obligations discussed in this bulletin, please do not hesitate to contact us. We are here to support you in the proper implementation of SAGRILAFT and to ensure compliance with the applicable regulations related to due diligence.