‘Beneficial Ownership’ information to be published soon as data collection begins

Adnan Adams Mohammed
In meeting the March 2020 deadline to have a
full information on companies’ beneficial owners, the Registrar General
Department (RGD) will begin collecting data of beneficial owners and upload it
to its electronic registry.
The RGD is almost done with the works on the
upgrading of its electronic registrar system to help create an interface that
will receive the beneficial ownership data from companies. Additionally, the
RGD has designed forms to facilitate the collection of beneficial ownership
data as well as a series of sensitization programmes being rolled out targeting
some specific sectors and industries in order to limit implementation gaps and
challenges.
These forms part of the processes towards the
RGD achieving its resolve to help disclose all beneficial owners of companies
registered under the Companies’ Act.
The identity of the real owners, the
‘beneficial owners’, of the companies that have obtained rights to extract oil,
gas and minerals is often unknown, hidden by a chain of unaccountable corporate
entities. This problem also affects other sectors and often helps feed
corruption and tax evasion. The RGD will publish information on the beneficial
owners of entities winning public contracts as part of EITI requirements,
according information on the OGP website.
As part of global efforts to fight corruption,
tax evasion and money laundering, every country is to be committed to collect
and publish beneficial owners of all companies.
This commitment builds on the Open Governance
Practice (OGP) second action plan’s commitment on Open Contracting. The
commitment is to provide information on the beneficial owners winning public
contracts. The commitment will make public all information on the beneficial
owners of public contracts to enable citizens support government to fight
corruption as well as minimize tax evasion. It will also help Ghana meet other
international requirements.
The commitment is relevant to increasing the
level of transparency by improving accessibility of information on the
beneficial owners of entities winning public contracts. It will also help to
improve rules, regulations, and mechanisms ensure full disclosure of beneficial
owners of public contracts.
In achieving this, the current Companies’ Act,
2019 is expected to streamline the corporate regulatory framework to contribute
immensely in ensuring transparency in the ease of doing business in the country
as well as assisting authorities to counteract money laundering, tax evasion,
and stemming of illicit financial flows.
A key plan of the Act is the development of an
electronic company registry to ensure an improvement in the collection of and
access to beneficial ownership data.
However, where a person fails to provide the
information required or gives false and misleading information, it will be
deemed as an offence liable on summary conviction to a fine of not less than
fifty penalty units and not more than two hundred and fifty penalty units. Such
persons can also face imprisonment for not less than one year and not more than
two years or even both fines and imprisonment.
Where a company defaults in complying, it is
liable to pay an administrative penalty of twenty-five penalty units for each
day beginning from the first day the offence was committed. In monetary value,
twenty-five penalty units is equivalent to GHc300.00.
Also, the Registrar General, Madam Jemima Oware
has already constituted a technical stakeholder forum to fix thresholds for
beneficial ownership disclosure for all the various sectors that will be
incorporated into the new Companies Law, 2019 for implementation next year.
This is on the basis that the Registrar
General’s Department (RGD) made provision for threshold’s to be set in the new
regime to effectively govern beneficial ownership disclosure.
Aside the intent of beneficial ownership regime
in assisting authorities to counteract money laundering, tax evasion, and
stemming illicit financial flows, it is part of strategic measures towards
complying with the 2016 Extractive Industries Transparency Initiative (EITI)
global conference resolution which made beneficial ownership disclosure
mandatory for all EITI implementing countries, of which Ghana is a member. It
gave countries up to January 2020 to fully operationalize the disclosure
regime.
Consequently, the Department brought together
technocrats drawn from key sectors of the economy including members who took
part in drafting the Companies Act, representatives from the Ministries,
Departments and Agencies (MDAs) as well as officials from key sectors such as
extractive, real estate gaming, banking, Civil Society Organisations among
others to make effective contributions into the setting up of thresholds for
disclosure of beneficial ownership.
Key among the discussions was the setting up of
different thresholds for different sectors on the basis that the average
enterprise of some sectors were considered as high value as against others in
relatively low value areas. Most of the participants pushed for zero percent
stake, meaning that all persons having a stake more than this figure in a
business enterprise must disclose beneficial ownership including politically
exposed persons.
Importantly, having such mechanisms in place
was seen as the right implementing factor in the regard that having one percent
stake in an enterprise in the extractive or oil and gas sector could amount to
over US$100 million dollars.
Different countries and international
organisations have used and prescribed varying percentages of thresholds to address
their respective beneficial ownership disclosure. For instance, the United
Kingdom and the European Union’s Anti-money Laundering Directive have threshold
of 25 percent.
“But assuming you set a threshold of 25 percent
as other countries have done, then you are going to let go as much as maybe
US$500 billion because there may be more owners who fall below the 25 percent
threshold”, Dr. Steve Manteaw, Co-Chair of Ghana Extractive Industries
Transparency Initiative (GHEITI) warned.
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