The number of “definitive deregistrations” or company strike-offs rose by more than 21% in Monaco over the course of 2023, according to the latest figures by IMSEE.
The 2023 Q4 Economic Report by Monaco’s statistics agency IMSEE reveals that 534 businesses were de-registered last year – a significant increase of 21.1% on the previous year. That number was higher still among the companies logged with the Trade and Industry Directory, the Répertoire du Commerce et de l’Industrie de Monaco or RCI. Among these companies, close to 23% were closed.
In contrast, 855 new business or companies were founded in Monaco last year, which equates to a 1.7% drop on 2022 figures. Again, those recorded in the RCI noted a more noticeable contraction of 10%.
While strike-offs had been on the rise throughout the year, the rate at which companies were formally declared to be closed picked up in the second half of the year.
According to IMSEE, the sharp increase in business closures was the “result of a significant regularisation process.”
In 2023, warnings from the Monaco Government regarding a new legal obligation for all companies, civil or commercial, to declare their beneficial owners also began to increase. It was one of the requests made by Moneyval, the anti-money laundering body of the Council of Europe, in its January 2023 report that identified key areas in which Monaco needed to improve its financial supervisory systems.
See more: Monaco to “step up” financial crime action after damning Moneyval report
A request asking Monaco-registered businesses to comply and ensure that their ownership details were up to date was issued in May 2023, along with a warning that “cases of legal entities whose legal status is irregular will be referred to the Court of First Instance”.
As reported by Monaco Life at the time, “A beneficial owner ultimately holds, directly or indirectly, at least 25% of the company’s capital or voting rights; they effectively exercise a power of control over the company by any other means, for example, they can appoint or dismiss the majority of the members of the management bodies; or it is the person or persons who legally represent the company, for example, the manager, managing director, etc.”
See more: Moneyval report: Monaco businesses reminded of obligation to report to government
After a series of general information conferences, events and reminders, aimed at encouraging owners of “unclaimed companies” to come forward, a full list of the companies that had failed to provide the necessary information was made available to the public. It can be viewed here.
The list is described as containing: “any non-trading companies for which a lack of a registered office has been identified or for which statutory term has expired [and] any trading company whose business license or declaration has been revoked or rendered ineffective due to lack of registered office or business activity”.
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Photo source: Romain Dancre, Unsplash