Disclosure of beneficial ownership now mandatory for companies, says CAC registrar

Garba Abubakar, registrar-general of the Corporate Affairs Commission (CAC), says the commission has mandated companies to disclose their beneficial owners at the point of registration.

He said this is to “entrench transparency and to support the anti-corruption initiative” of President Muhammadu Buhari administration.

Abubakar disclosed this at a press briefing themed ‘Beneficial ownership register, an Antidote to Corruption,’ organised by the Civil Society Legislative Advocacy Centre (CISLAC), in Lagos, on Wednesday.

He said all companies that registered with the commission from January 3 till date were mandated to disclose their persons of significant control or beneficial owners at the point of registration.

The CAC registrar also said that for companies that registered earlier than January 3, the disclosure would start from their next annual returns depending on the financial year-end of each company.

He added that companies that have filed their financial annual returns from January till date must mandatorily disclose their persons of significant control.

“Nigeria has started implementing beneficial ownership disclosure in line with the commitment made by Mr President during the London anti-corruption summit in 2016. It took this long to start the implementation because of the absence of a legal framework,” he said. 

“The companies and allied matters act 2020 was re-enacted, and it now provides for mandatory disclosure of persons of significant control. The Corporate Affairs Commission (CAC) is the agency responsible for giving effect to the provision of this new law, since the 3rd of January this year, the CAC has deployed an electronic register that covers all aspects of our registration services, and this includes the disclosure of beneficial ownership. 

“From January 3 till date, every company registered with CAC must disclose its persons of significant control or beneficial owners at the point of registration and whenever there’s any change in the information or at a point of filing of annual returns for new companies registered from third January till date, the information is available if you go to pre.cac.gov.ng, you click on any company registered from the third January to date, you can view that information at no cost.

“For companies registered earlier than that date, the disclosure will start from their next annual returns, and that depends on the financial year-end of each company.

Companies that have filed their financial annual returns from January till date must mandatorily disclose their persons of significant control. 

“All essence of doing this is to entrench transparency and to support the anti-corruption initiative of the government, so that as a citizen if you have reasons to believe that the information in the portal is not a true reflection of the ownership of the company then you can escalate this information and report to relevant agencies for investigation.”

Also speaking, Auwal Rafsanjani, executive director of CISLAC, said the availability of the move by the commission would enable anti-corruption agencies and relevant stakeholders to monitor the movement of illicit funds and the persons behind it.

He also said that by signing the Companies and Allied Matters (Amendment) Act 2020, the Nigerian government marked significant progress in the implementation of beneficial ownership transparency.

Rafsanjani added that provision should be made for a fully automated information technology system with human supervision that will have access to relevant data, to verify the credibility of the registered information regularly.

“The Nigerian government has marked significant progress in the implementation of the beneficial ownership transparency as indicated by the signing of the Companies and Allied Matters (Amendment) Act 2020 and ongoing process towards the establishment of a central register for disclosure of all corporate entities in the country that would subsume and complement the beneficial ownership register for extractive sector companies already established by the NEITI in December 2019,” he said.

“Let us be clear that beneficial ownership and the more general issue of money laundering is not only a Nigerian or African problem. But as long as inefficiency and the lack of political will to sanitise our systems persist, consequences in the form of terrorism financing, transnational organised crime, tax evasion and illegal enrichment of politically exposed persons will prevail.

“We thus seek advocacy for identifying a verification process that ensures people in the official register are authentic- that is, they are who they say they are, authorized- that is those persons have agreed to be involved in a legal entity, and that all the registered data is valid.”