Companies (Beneficial Ownership Information) Regulations, 2020
In exercise of the powers conferred by section 1022 of the Companies Act, 2015, the Attorney General of Kenya has published into law the Companies (Beneficial Ownership Information) Regulations, 2020.
According to the Regulations, every company is required to lodge a Register of Beneficial Owners with the Registrar of Companies. The regulations set out how the disclosures are to be made and the obligations of a company in relation to these disclosures (explained below).
As per the Regulations, a Beneficial Owner is 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.
The Regulations apply to Beneficial Owner who:
Holds at least 10% of the issued shares in a company either directly or indirectly.
Exercises at least 10% of the voting rights in a company either directly or indirectly.
Holds a right to appoint or remove a director whether directly or indirectly.
Exercises significant influence or control, directly or indirectly, over the company.
A company is required to enter the following details in the Register of its Beneficial Owners:
Full name
Birth certificate number, national identification number or passport number
PIN number
Nationality
Date of birth
Postal address
Business address
Residential address
Telephone number
Email address
Profession or occupation
Nature of Ownership or control
Date on which a person became a Beneficial Owner
Date on which a person ceased to be a Beneficial Owner
Any other relevant information the Registrar may require from time to time
A company shall give notice to a person it knows or has reasonable cause to believe that the person is a Beneficial Owner, requiring the person to provide the particulars set out above. Such a person is required to comply within a period of twenty-one (21) days failure to which the company shall issue a warning notice to the person with the following information:
Date the warning is issued and the date of compliance
Copy of the notice issued (to be attached)
Require the person to comply with the notice issued
State that the company is proposing to restrict the relevant interest the person holds in the company
The company shall restrict the relevant interests if the person has not complied with the warning notice within fourteen (14) days, make a note of the restriction issued in the Register, file a copy of the restriction issued with the Registrar and notify the person affected in writing.
Where a person complies with the warning notice after the specified time, the company shall withdraw the restriction, make a note in the Register, and notify the Registrar within fourteen (14) days of the withdrawal.
A company shall not use or disclose information about its Beneficial Owner unless the company is communicating with the Beneficial Owner, complying with these regulations, complying with a court order or with a written consent of the Beneficial Owner.
A company is further required to lodge with the Registrar particulars of any changes of its Beneficial Owners as well as a notice of any person ceasing to be a Beneficial Owner.
What is expected of your company?
Collect details of the Beneficial Owners of the company as outlined above.
Forward the information to the Company Secretary.
The Company Secretary will thereafter complete the Register of Beneficial Owners and lodge the Register with the Registrar of Companies.
Azali, Always at your service!
By D. Njagi, Senior Associate
May 2020
