Beneficiary ownership: Higher penalties for non-disclosed firms
Penalties for companies that fail to disclose their beneficial owners and owners who are politically exposed will be increased, the Office of Registrar of Companies (ORC) has disclosed.
The Registrar of Companies, Mrs Jemima Oware, said the current penalty of GH¢300 a day was not deterrent enough and, therefore, her outfit was in discussions with various stakeholders to come out with new regulations to increase the sanctions.
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“The penalty is not deterrent and companies can actually flout it because they know they can simply pay” she said.
Mrs Oware was speaking in an interview with the Daily Graphic on the sidelines of a two-day workshop for the ORC and its sister organisation from Nigeria -Corporate Affairs Commission (CAC) on how best the two entities could share ideas on strengthening compliance with the disclosure of beneficial ownership in the two countries.
The workshop was organised by the German Development Cooperation (GIZ), in partnership with the UK Aid and the Bill and Melinda Gates Foundation.
Beneficial owner
Under Section 13 of the Companies Act, 2019 (Act 992), any company seeking to be incorporated in the country must disclose its beneficial owner (s) which are persons who directly or indirectly have substantial control over the company.
Among other disclosures such as name, nationality and nature of interest in a company, a company must also disclose to the ORC whether its beneficial owner is politically exposed.
Per Section 35 (15) of Act 992, if a company defaults in disclosing its beneficial owner, every officer of the company responsible for that failure is liable to pay administrative charges of 25 penalty units (GH¢300) each day the company defaults.
Section 35 (14) of Act 992 stipulates that a person who provides false information on a beneficial owner if found guilty could be fined up to 200 penalty unites (GH¢2,400) or serve a term of imprisonment of up to two years.
Increment
The Registrar of Companies said the Companies Act had clothed the ORC with the powers, to come out with legislative instruments (LIs) which it would use to increase the penalty for those who failed to disclose their beneficial owners.
She, however, indicated that any such increment or LIs would not be designed to stifle businesses, adding that “it should not be too punitive or else it will not serve its purpose”.
Benefits
In another interview, the Registrar of the CAC, Alhaji Garba Abubakar, said disclosure of beneficial owners of companies was a crucial tool in the fight against financing of terrorism, money laundering and trans-national crimes”.
“Corporate bodies, particularly companies, are the main vehicles through which proceeds of such crimes are channelled because there is a limit to what an individual can do. The best way to block this is to know the beneficial owners of these companies,” he said.
A consultant on beneficial ownership, Samuel Bekoe, said disclosure of beneficial owners of companies helped tax authorities to prevent tax evasion and tax fraud.
Also, he said disclosure of beneficial owners was also in the interest of companies.
“If a company wants to form any partnership, whether joint venture or otherwise, knowing the beneficial owners will help in its due diligence process,” he said.