The new Beneficial Ownership Regulations (the Regulations) requires all persons, either a company or an individual, with a registered business name to submit information about beneficial ownership.

What is beneficial ownership and why is it an area of concern?

Fundamentally a beneficial owner is a person who has some control over another person’s activities. The definition of a beneficial owner according to the Anti-Money Laundering Act is very wide and considers various business arrangements.

However in the context of a registered business name it means a natural person who exercises ultimate effective control over your business. It can be a person in whose interest the business is set up or operates. Control can be direct or indirect ownership or by any other means.

The primary objective of the Regulations is to address challenges in combating money laundering and countering financing of terrorism and countering the proliferation financing. The Financial Intelligent Unit (FIU) is the authority responsible in combating money laundering and the financing of terrorism. FIU receives suspicious transaction reports, in relation to suspected money laundering and terrorist financing activities, analyzes and disseminates intelligence for investigation and further action.

Is this applicable to me?

Every managing partner of a registered business name is required to maintain and submit the information about beneficial ownership. The business arrangement can be either a sole proprietorship or a partnership or otherwise.

Also a registered partner who is not a beneficial owner in a business will be required to submit his declaratory statement in prescribed form to the managing partner.

Also a beneficial owner who is not registered as a partner in business will be required to file a prescribed form to the managing director.

The information to be maintained and submitted concerns the legal arrangement with the beneficial owner and any changes in its status which might include personal details of the beneficial owner, information about how she exercises influence over the business, and any agreement available.

The information about beneficial ownership must be kept in strict confidence.

Why should I comply?

To enforce compliance the following sanctions may be applied by the relevant regulatory authorities for non-compliance.

• The managing partner will be liable to a default fine if he or she does not submit the information in time.
• Failure to maintain information about beneficial ownership or to submit the information to the Registrar is a criminal offence punishable by fine of not less than 1 million and not more than 5 million.
• The Registrar can refuse to register or accept a document on the ground that the information about the beneficial ownership has not be supplied or the supplied information is incorrect.

What is the compliance deadline?

Every managing partner of a business which is already registered is required to submit the information about beneficial ownership within 60 days after coming into effect of the regulations. The Regulations came into effect on the 22^nd September, 2023. For the information obtained after coming into effect of the Regulations, it must be filled within 30 days after receiving them.

Filing of information to the managing partner by the registered person who is not a beneficial owner or a beneficial owner who is not a registered partner must be made within 14 days.

In case of lapse of time you can request for extension of time to fill the necessary information to the Registrar. The Registrar can extend the time but not for more than 30 days.

How do I comply?

The information about beneficial ownership must be submitted to BRELA directed to the Registrar of business names (the Registrar) in prescribed forms, as well as supporting documents. This is important to ensure compliance and prevent sanctions.

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