- November 27, 2020
- Posted by: bloomgcfo
- Category: Accounting
All Companies registered in Kenya are now required to submit details of their Beneficial Owners to Registrar of Companies pursuant to section 93A of the Companies Act 2015. On 16th October 2020, the Registrar of Companies operationalized the Beneficial Ownership (“BO”) E-Register with effect from 13th October 2020.
Officers of the companies and Authorized persons are required to comply with the above provision of the Act and submit a copy of the Beneficial Ownership Register within 30days of its preparation and to notify the Registrar within 14 days of any change in Beneficial Ownership Information. Failure to comply with this requirement makes it an offence to the Company and every officer of the company who is in default.
A Beneficial Owner is a defined to mean ‘A natural person who ultimately owns or controls a legal person or arrangements or the natural person on whose behalf a transaction is conducted and includes those persons who exercise ultimate effective control over a Legal person or arrangement.
These Regulations apply to a Beneficial Owner who;
∙ Holds at least 10% of issued shares in the company either directly or indirectly
∙ Exercises at least 10% of the voting rights in the company either directly or indirectly ∙ Holds a right directly or indirectly to appoint or remove a director of the company
∙ Exercises significant influence or control directly or indirectly over the company i.e. The ability to participate in decision making when it comes to matters relating finances and financial policies of a company without necessarily having full control over them.
Beneficial Ownership can be lodged;
∙ During the Initial Registration of a Company
∙ As an update of the BO register for existing Companies
∙ As an amendment to the existing company’s BO information
The particulars of its beneficial owners to be included in the register include;
∙ Full Name
∙ ID Number/Passport Number/Birth certificate Number
∙ KRA PIN
∙ Date of Birth
∙ Postal address, Business address and Residential address
∙ Telephone Number/Mobile Number
∙ Email address
∙ Nature of ownership or control
∙ The date on which a person became a beneficial owner of the company
∙ The date on which a person ceased to be a beneficial owner of the company
∙ Any other relevant Information required by Registrar of Companies
These particulars should be in the prescribed form BOF1 and thereafter lodged with Registrar of companies within 30days of its preparation.
Consequences of Noncompliance;
Failure to register details of the beneficial ownership would nullify
∙ Any transfer of the beneficial owner’s interests,
∙ No rights will be exercisable in respect of that interest,
∙ No shares may be issued under rights of the interest or in pursuance of an offer made to the interest holder,
∙ No payment may be made of sums due from the company in respect of the interest. Restrictions on disclosure of beneficial ownership details;
The general rule is that beneficial ownership information shall not be made available to the public. The Regulations only permit disclosure:
∙ where it is for communication purposes with the beneficial owner for compliance with the Regulations; ∙ in compliance with a court order;
∙ upon the request of a competent authority such as the office of the Attorney General and an investigative agency; or
∙ with the written consent of the beneficial owner.
The Regulations make it an offence punishable by a fine not exceeding KES 20,000 or imprisonment for a term not exceeding 6 months, for the company to unreasonably disclose beneficial owners’ information.
We would be pleased to assist your company to comply with the requirements of the Regulations.
For any enquiries, please contact +254 727 461 478 or email us on firstname.lastname@example.org This article is provided free of charge for information purposes only, it does not constitute legal advice.