02/11/20

AFRICA: Kenya seeks real identity of shareholders of companies.

As published on kbc.co.ke, Saturday 31 October, 2020.

The Office of the Attorney General has moved in unearth identify of individuals who ultimately own or control companies either directly or indirectly with the creation of the Beneficial Ownership E-Register.

In an effort to escalate war on graft and illicit trade, all registered firms are now required to prepare a list of its beneficiaries and submit it electronically to the Business Registration Service portal by 31st January 2021.

The move is expected to reveals names of anonymous investors who wield as much as 10% shares in the firms, and use proxies to engage in corrupt dealings and tax evasion.

Section 93A of the Companies Act, 2015 and the Companies (Beneficial Ownership Information) Regulations, 2020 require all companies registered under the Act to keep a register of its beneficial owners and lodge the same with the Registrar of Companies.

The Service says all officers and authorized persons of existing companies are required to submit a copy of the Beneficial Ownership Register within 30 days of its preparation and to notify the Registrar within 14 days of any change in Beneficial Ownership information.

However, a three-month grace period has been granted.

“Failure to comply with this requirement makes it an offence to the Company and every officer of the Company who is in default,” said BRS Director General Kenneth Gathuma.

As per the Act, individual defaulters who fail to comply could face a fine of up to Kshs 500,000 upon conviction.

“The Beneficial Ownership Register will create greater transparency in the ownership of companies in Kenya and support the government in the fight against corruption, money laundering and financing of terrorism,” said Gathuma.

The Business Registration Service is a semi-autonomous body under the Office of the Attorney General and Department of Justice.

BRS was established by the Business Registration Service Act, 2015 with a mandate to oversee the operations of the Companies Registry, Movable Property Security Rights Registry (Collateral Registry), Insolvency (Official Receivers) Registry and the Hire Purchase Registry in Kenya.