New rules to unmask faceless firm owners

Traders check out the trading index during the Bell Ringing ceremony for KENGEN to trade at the NSE at the NSE's offices in Westlands, Nairobi. [Elvis Ogina/Standard]
Details of shadowy shareholders in local firms, including foreigners, will now be laid bare after the Attorney General published regulations requiring firms to keep a register of beneficial owners.

In what is seen as another attempt by the State to combat money laundering, Kenya has joined other jurisdictions such as the European Union in tasking firms to reveal personal details of individuals owners with a stake or voting right of at least 10 per cent.

The Companies (Beneficial Ownership Information) Regulations, 2019, require companies to disclose a myriad of details of an individual who owns a company, either directly or indirectly.

The move is aimed at unmasking shadowy shareholders who might be engaged in illicit financing or even corrupt practices.

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Some shareholders have been taking advantage of a loophole in financial laws that allow one to mask their wealth in public listed companies.

Currently, if one does a search of a company, there is a likelihood he or she cannot see the identity of individual owners of a proxy with a significant stake in a company.

However, six months after the publication of these regulations, every company shall be required to provide the Registrar of Companies with personal information for individuals with at least 10 per cent stake or voting rights in a company. 

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Some of this personal information includes the beneficial owners’ full name, current telephone number, date of birth, postal and residential address, occupation, current email address, passport number or national identification number.

Companies will also be required to reveal the nationality of the beneficial owner, the date on which any individual ceased to be a beneficial owner, nature of ownership or control, and any other detail the registrar may require from time to time.

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European UnionBeneficial Ownership Information