Home Business Editorial: Beneficial ownership (BO) information not being complied with

Editorial: Beneficial ownership (BO) information not being complied with

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The Office of the Registrar of Companies (ORC) is complaining that only 25.8 percent of registered companies have declared their beneficial ownership (BO) information, three months after the deadline requiring businesses to do so.

As at February 27, 2023, the ORC said only 74,316, representing 25.8 percent out of the 287,189 registered companies and businesses, had disclosed BO information to it despite numerous notices to comply with the law.

For failing to comply with the December 31, 2022 deadline, a Principal State Attorney and Assistant Registrar at the ORC, Lysbeth A. Osae, said the over 70 remaining companies, along with some defaulting companies that have also not filed returns in a very long while, are likely to suffer from the ORC’s periodic strike off processes in the coming days.

It would be recalled that the Registrar-General’s Department (RGD) in March 2021 introduced the Beneficial Ownership Transparency Regime as part of the company registration processes under the Companies Act 2019 (Act 992) to ensure companies knew the faces they were transacting business with.

It is in line with the country’s commitment to accelerate beneficial ownership disclosures to promote transparency, curb opacity, and disincentivise corrupt practices.

It is precisely because of this commitment that government introduced the new Companies Act (992) in 2019, mandating companies to submit information about ultimate beneficial owners.

A central register was established in 2020 with ownership data for over 200,000 entities.

According to Ghana’s Companies Act, a beneficial owner is defined as an individual who directly or indirectly, or ultimately owns or exercises substantial control over a person, or company.

A beneficial owner is also one who has a substantial economic interest in or receives substantial economic benefits from a company, whether acting alone or together with other persons.

At the time of incorporation, all companies are required to submit BO information as well as during the filing of annual returns, and whenever they wanted to make changes to their details.

A person who fails to provide the information required or provides false or misleading information to the registrar commits an offence and is liable on summary conviction to a fine of not less than fifty penalty units, and not more than two hundred and fifty units, or to a term of imprisonment not less than one year and not more than two years or both.

Additionally, where a company defaults in complying with the law, the company and every officer of the company is deemed liable to pay to the registrar an administrative penalty of twenty-five penalty units for each day, during which the default continues.

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