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By Batuli Majid, Associate at Grant Thornton
A beneficial owner is an individual person other than a legal person/corporate body who has control over express trust or fiduciary relationships or on whose behalf an undertaking takes place.
The BRS (Business Registration Service); an online platform where Companies and entities are required to lodge the Beneficial Ownership (B.O) information, reiterates on the need for transparency and disclosure on B.O information so as to promote good governance and help mitigate cases of transgression and treachery.
Pursuant to the BO Regulations 2020 and BOI amendment regulations, 2022, a person qualifies as a Beneficial Owner if the person falls under any of these categories:
Disclosure of B.O information is restricted to:
1. Disclosure by the Company
A Company is not required to disclose its B.O information everywhere, however, it should go ahead and disclose to the following:
2. Disclosure by the Registrar
The Registrar may disclose B.O information to:
3. Disclosure by Public Procurement Regulatory Authority
PPRA shall publish in its public portal the BO information of the entities that have been awarded tender by a procuring entity or a contracting authority.
4. Disclosure by the Government
The Government may disclose to the public BO information of any entity if such information affects the country.
Steps of Filing Beneficial Ownership Information of a Company with the Registrar of Companies:
The company should prepare Form BOF1 which contains the information set out and lodge the same with the Registrar of Companies within thirty (30) days of preparing the said Form BOF1.
When a B.O fails to provide the details required to lodge a BOF1, the Company should issue a warning notice stating that it is proposing to restrict the relevant interest of the Beneficial Owner.
The effect of the said restriction is:
A Company is further required to keep a register of its beneficial owners separate from the register of members: The BO information can be kept either in a manual register or in an electronic Register.
Once the register is prepared, the company must lodge the register with the Registrar of Companies within thirty (30) days.
These requirements refer to the first time the BO Register is submitted by a newly registered company or by an existing company in compliance with the BO regulations, failure to which the company may be liable for committing an offence which attracts a maximum fine of Kenya Shillings Five Hundred Thousand (KShs.500,000/-).
An individual who illegally discloses beneficial ownership information for other purposes which are different from what is provided by the regulations commits an offence and upon conviction will be liable to pay a fine not exceeding KShs 20,000/- or to be imprisoned for a period not exceeding six months or to both.