What the chart is for
A regulated provider must identify the natural persons who ultimately own or control a client. For a company owned directly by two individuals, a sentence is enough. For a company owned through three layers of holding companies in different jurisdictions, with a trust somewhere in the middle, words alone stop working. The chart does the job a paragraph cannot.
The analyst will use your chart to do three things: identify every entity whose documents must be collected, calculate each individual's effective interest in the applicant, and spot control that does not come from shareholding, such as a protector's powers or a voting agreement. Your chart should make all three easy.
A good chart is also evidence of your own understanding of the structure. When the person who prepared the chart can explain every box and line, the analyst gains confidence in the rest of the file.
Format and tools
There is no prescribed format. A clean diagram in any drawing tool, a well-laid-out slide or even a neat hand-drawn chart that has been scanned will be accepted by most providers. What matters:
- Top to bottom: individuals at the top, the applicant company at the bottom. Ownership flows downwards.
- One box per entity or person, labelled consistently with the names on their documents.
- Arrows or lines with percentages on every ownership link.
- A title, date and signature. Most providers want the chart signed by a director or authorised person, confirming it is accurate as at the date shown.
- One page if at all possible. If the structure has a large operating group below the applicant, show only the part relevant to ownership of the applicant and note that the rest is omitted.
Use the full legal names that appear on each entity's certificate of incorporation. "ABC Holdings" in the chart and "ABC Holdings Limited" on the certificate is fine. "ABC Group" in the chart when no entity of that name exists is not.
Step by step
- Start with the applicant. Draw a box at the bottom with its full name, jurisdiction and registration number.
- Add each direct shareholder above it, with their percentage. Check the percentages add up to 100 per cent. If they do not, find out why before going further.
- For each corporate shareholder, repeat. Add its shareholders above it, with percentages. Continue until every branch ends in a natural person, a listed company, a government body or another endpoint the provider accepts.
- Label each box with the entity type and jurisdiction, for example "Holding company, BVI" or "Trust, Cook Islands".
- Mark the controllers who are not shareholders: directors of the applicant, trustees, protectors, managers of an LLC, general partners.
- Calculate effective interests for each individual, using the method below, and write them beside the individual's box.
- Add a legend if you use different box shapes or line styles, for example dashed lines for nominee holdings.
- Cross-check against the incumbency certificates and registers you are submitting. Every link on the chart should be evidenced by a document.
What to include at each layer
For every box, include enough information for the analyst to find the matching document without searching:
| Box type | Information to show |
|---|---|
| Company | Full legal name, jurisdiction, registration number, entity type |
| Partnership | Name, jurisdiction, general partner, limited partners above any threshold |
| Trust | Name of trust, governing law, trustee, settlor, protector if any, beneficiaries or class |
| Foundation | Name, jurisdiction, council members, founder, beneficiaries or purpose |
| Individual | Full name as on passport, nationality, country of residence, role, effective interest |
| Listed company | Name, exchange and ticker; no need to go further up |
Where share classes carry different rights, show both economic and voting percentages, for example "40% economic / 60% voting". Providers look at both, because control can sit with a minority economic owner who holds the votes.
Calculating indirect ownership
The basic rule: multiply the percentages along each path from the individual to the applicant, then add the results of all paths.
Worked example 1: a single chain. Maria owns 80% of a BVI holding company. The BVI company owns 50% of a Cyprus company, the applicant. Maria's effective interest is 80% x 50% = 40%.
Worked example 2: two paths. Tomasz owns 60% of a Nevis LLC and 10% of the applicant directly. The Nevis LLC owns 30% of the applicant. Tomasz's indirect interest through the LLC is 60% x 30% = 18%. Adding his direct 10% gives 28% in total. On a quick reading he looks like a 10% shareholder, but he is above the usual 25% threshold.
Worked example 3: three layers. An individual owns 50% of Company A. Company A owns 70% of Company B. Company B owns 60% of the applicant. Effective interest: 50% x 70% x 60% = 21%.
All three examples are illustrative. Two points often trip people up:
- Control can exceed economics. In example 3, the individual owns only 21% economically, but if they control Company A (with 50% and a casting vote, say) and Company A controls Company B, they may control the applicant. Providers look at control along the chain, not only the multiplied percentage.
- Thresholds are lower than you might think. Many providers identify everyone at 25%, but some use 10% for higher-risk activity. Show all effective interests, not just those above 25%, so the analyst can apply their own threshold.
Showing trusts in a chart
Trusts do not have shareholders, so they need special treatment. The usual approach:
- Draw a box for the trust, labelled with its name and governing law.
- Show the trustee as the legal owner of the shares in the underlying company. Many charts place the trustee in the box with the trust, for example "Trustee: XYZ Trust Company Limited as trustee of the Smith Family Trust".
- Above or beside the trust, show the settlor, any protector, and the beneficiaries. For a discretionary trust, name any beneficiaries who are identifiable and describe the class for the rest, for example "issue of the settlor".
- Do not assign a percentage to discretionary beneficiaries, because they have no fixed entitlement. Instead, note "discretionary" on the line.
- For a fixed-interest trust, show each beneficiary's share.
Providers will generally want to identify the settlor, trustee, protector and any beneficiaries who have received or are expected to receive distributions, regardless of percentages. Our pages on trusts and fiduciaries say more about how these structures are onboarded.
Showing nominees in a chart
Where shares are held by a nominee, the chart should show both the nominee and the beneficial owner, with the relationship made clear. A common approach is to draw the nominee in a box with a dashed line up to the beneficial owner, labelled "holds as nominee for", and to cite the declaration of trust in the legend.
Never leave a nominee as the top of a branch. The whole purpose of the chart is to reach the natural person behind the structure, and a nominee shareholder by definition is not that person. If a corporate service provider acts as nominee director, show it as a director of the relevant company, not as an owner. Our guide on nominee directors and shareholders covers the documents that should accompany the chart.
A complete worked example
The following structure is illustrative. The applicant is a Polish operating company, Alfa sp. z o.o. Its shareholders are a Cyprus holding company (70%) and an individual, Anna (30%). The Cyprus company is owned 100% by a BVI company. The BVI company is owned 50% by Anna and 50% by a Cook Islands trust, whose trustee is a licensed trust company. The settlor of the trust is Anna's father, and the discretionary beneficiaries are Anna, her brother Piotr and their children.
The chart would show, from the bottom up: Alfa at the base; the Cyprus company and Anna above it with 70% and 30%; the BVI company above the Cyprus company with 100%; Anna and the trust above the BVI company with 50% each; and above the trust, the trustee, the settlor and the beneficiaries with "discretionary" on the line.
The calculations: Anna holds 30% directly. Her indirect interest is 50% x 100% x 70% = 35%. Her total effective interest is 65%. The trust's indirect interest is 50% x 100% x 70% = 35%, held by the trustee, with no fixed percentage attributable to any one beneficiary. Anna is the controlling beneficial owner. The trustee, the settlor and the identified beneficiaries, including Piotr, would also need to be identified because of the trust's 35% interest.
Documents needed: corporate documents for Alfa, the Cyprus company and the BVI company; the trust deed or a certified extract, and the trustee's details; and KYC for Anna, her father, Piotr and the directors of each company. With the chart and these documents side by side, the analyst can verify every line.
Common mistakes
- Percentages that do not add up to 100 per cent at a layer, with no explanation for the gap. If the rest is held by many small shareholders, say so.
- Entities on the chart with no matching documents in the file.
- Names that do not match the certificates.
- Old charts that pre-date a transfer, a merger or a change of trustee.
- Missing directors and controllers, so the chart shows ownership but not control.
- Charts that show an entire group of fifty companies, burying the ownership path to the applicant.
- No date or signature.
An inconsistent chart is one of the most frequent reasons an application stalls, as our article on why applications are declined explains.
Getting help
This guide is general information and is not legal advice. Your corporate service provider or lawyer will usually have an up-to-date chart on file, and it is worth asking them to review yours before you submit it.
When you apply to CCYFX, include a signed chart with your documents. The onboarding checklist builder lists the documents we need for each type of entity that appears on it.
