- The Business Registration Service extended the period on account of a high number of applications to file the information at the Companies Registry.
- Failure to comply with this requirement after July 31 2021 makes it an offence to the company.
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Companies have six more months to provide the state with the identity of their secret shareholders in efforts to unravel individuals behind various property ownership.
The Business Registration Service (BRS) has extended the period for the submission of beneficial ownership information to July 31 following a high number of applications.
The deadline was initially set for January 31 2021.
“Having taken note of the progress made in filing these registers and in the spirit of encouraging compliance with the Companies Act, BRS has in consultation with stakeholders granted a final grace period of six months ending July 31 2021,” said Kenneth Gathuma, Director General, BRS in a statement.
Failure to comply with this requirement after July 31 2021 makes it an offence and every officer of the company who is in default is liable to a fine upon conviction.
A beneficial owner is the natural person who ultimately owns or controls a legal person 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 arrangements.
The BRS had previously communicated that companies registered under the Companies Act, 2015 and the Companies Act Cap. 486 Laws of Kenya (now repealed) are required to prepare and submit a copy of the Beneficial Ownership registers to the Registrar of Companies within 30 days of its preparation and to notify the Registrar within 14 days of any change in beneficial ownership information.
“We have first operationalised the E-Register for private limited companies and shall progressively operationalise the E-Registers for the other types of companies,” said Gathuma.
He cautioned the public of persons soliciting money to facilitate them in complying with this requirement.
We advise the public to be cautious of persons soliciting money to facilitate them in complying with this requirementKenneth Gathuma, Director General, Business Registration Service
Submission of the beneficial ownership information can be undertaken by any company officer/authorised person online through a the step-by-step beneficial ownership e-register manual available at www.brs.go.ke.
The disclosure of the beneficial ownership information is expected to promote good governance and increase trust in Kenyan companies and ensure greater transparency of company ownership.
This will also help in the fight against corruption, money laundering and financing of terrorism.
The register is not accessible to unauthorised persons but only to competent authorities who may use the register upon request.
There has been concern that nominee shareholding has been a breeding ground for drug dealers, child traffickers, tax evaders, terrorist financiers and others taking advantage of the anonymity to launder money.
The value of blue-chip shares at the NSE held through nominee shareholders is slightly over 10 per cent of the total wealth at the bourse and two per cent of the country’s gross domestic product (GDP).
Safaricom, the company with the largest market capitalisation at the NSE has the largest chunk of nominee shareholding, at Sh58.6 billion.
It is followed by Standard Chartered Bank with Sh41.5 billion and EABL with Sh31.8 billion.
Kenya is one of the places in the world where it is easy to open an anonymous shell company to launder illicit proceeds of criminals and terrorists, according to researchers at the University of Texas-Austin, Brigham Young University, and Griffith University.