Amendment status not verified — confirm the current text below against the official source.
For the purposes of these guidelines, a) Beneficial Owner means an individual who ultimately owns or controls a client of a reporting entity or the person on whose behalf a transaction is being conducted and includes a person who exercises ultimate effective control over a juridical person. As specified in Rule 9(3) of PMLR, the beneficial owner shall be determined as under: I. where the client is a company, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical persons, has a controlling ownership interest or who exercises control through other means. Explanation.--1. "Controlling ownership interest" means ownership of or entitlement to more than 25% of shares or capital or profits of the company; 2. "Control" shall include the right to appoint majority of the directors or to control the management or policy decisions including by virtue of their shareholding or management rights or shareholders agreements or voting agreements; II. where the client is a partnership firm, the beneficial owner is the natural person(s) who, whether acting alone or together, or through one or more juridical person, has ownership of/ entitlement to more than 15% of capital or profits of the partnership; III. where the client is an unincorporated association or body of individuals, the beneficial owner is the natural person(s), who, whether acting alone or together, or through one or more juridical person, has ownership of or entitlement to more than 15% of the property or capital or profits of such association or body of individuals; IV. where no natural person is identified under (a) or (b) or (c) above, the beneficial owner is the relevant natural person who holds the position of senior managing official; V. where the client is a trust, the identification of beneficial owner(s) shall include 'identification of the author of the trust, the trustee, the beneficiaries with 15% or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership; and VI. where the client or the owner of the controlling interest is a company listed on a stock exchange, or is a subsidiary of such a company, it is not necessary to identify and verify the identity of any shareholder or beneficial owner of such companies. b) Central KYC Records Registry means a reporting entity, substantially owned and controlled by the Central Government, and authorised by that Government through a notification in the Official Gazette to receive, store, safeguard and retrieve the KYC records in digital form of a client as referred to in clause (ha) of Section 2 of the PMLA in such manner and to perform such other functions as may be required under PMLR. c)Client means a person who is engaged in a financial transaction or activity with a reporting entity and includes a person on whose behalf the person who engaged in the transaction or activity, is acting. For the purpose of these Guidelines, a client includes a customer engaged or attempting to engage into a transaction with the Reporting Entity. d) Designated Director means a person designated by the reporting entity to ensure overall compliance with the obligations imposed under chapter IV of the PMLA and the PMLR and includes - a) The Managing Director or a Whole-Time Director duly authorised by the Board of Directors if the reporting entity is a company; b) The managing partner, if the reporting entity is a partnership firm; c) The proprietor, if the reporting entity is a proprietorship firm; d) The managing trustee, if the reporting entity is a trust; e) a person or individual, as the case may be, who controls and manages the affairs of the reporting entity if the reporting entity is an unincorporated association or a body of individuals; and f) such other person or class of persons as may be notified by the Government if the reporting entity does not fall in any of the categories above." e) Person includes an individual; a Hindu undivided family; a company; a firm; an association of persons or a body of individuals, whether incorporated or not; every artificial juridical person not falling within any of the preceding subclauses; and any agency, office or branch owned or controlled by any of the persons mentioned above. f) Principal Officer is defined as an officer so designated by a reporting entity. The Principal Officer would act as a central reference point in facilitating onward reporting of suspicious transactions and for playing an active role in the identification and assessment of potentially suspicious transactions and shall have access to and be able to report to senior management at the next reporting level or the Board of Directors. It is desirable that the 'Principal Officer' is of a sufficiently senior position and is able to discharge the functions with independence and authority. g) Real Estate Agent means a real estate agent as defined under clause (zm) of section 2 of the Real Estate (Regulation and Development) Act, 2016, who negotiates or acts on behalf of one person in a transaction of transfer of his plot, apartment or building, as the case may be, in a real estate project, by way of sale, with another person or transfer of plot, apartment or building, as the case may be, of any other person to him and receives remuneration or fees or any other charges for his services whether as a commission or otherwise and includes a person who introduces, through any medium, prospective buyers and sellers to each other for negotiation for sale or purchase of plot, apartment or building, as the case may be, and includes property dealers, brokers, middlemen by whatever name called and having annual turnover of Rupees twenty lakhs and above. h)Regulator means the Directorate General of Audit (DGA), Central Board of Indirect Taxes and Customs (CBIC) i) Suspicious transaction is defined as a transaction, including an attempted transaction, whether or not made in cash which, to a person acting in good faith- (i) gives rise to a reasonable ground of suspicion that it may involve proceeds of an offence specified in the Schedule to the PMLA, 2002, regardless of the value involved; or (ii) appears to be made in circumstances of unusual or unjustified complexity; or (iii) appears to have no economic rationale or bona fide purpose; or (iv) gives rise to a reasonable ground of suspicion that it may involve financing of the activities relating to terrorism. Explanation.-- Transaction involving financing of the activities relating to terrorism includes transaction involving funds suspected to be linked or related to, or to be used for terrorism, terrorist acts or by a terrorist, terrorist organisation or those who finance or are attempting to finance terrorism.