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A beneficial owner ('BO) is a person who owns or controls an entity. Section 93A of the Companies Act introduced mandatory beneficial ownership registers for private companies. The Companies (Beneficial Ownership Information) Regulations of 2020 were promulgated to implement this provision.

Who can be a beneficial owner?

Only a natural person can be a BO. Under Regulation 3(2), a BO is one who meets either of the following requirements:

1. Shareholding: holds at least 10% of the company's issued shares directly or indirectly. Indirect shareholding is when one has company shares through a proxy or intermediary.
2. Voting rights: exercises at least 10% of the voting rights in the company either directly or indirectly.
3. Power to appoint or remove a director: holds a right, directly or indirectly, to appoint or remove a company director.
4. Significant influence or control: directly or indirectly participates in a company's finance matters or financial policies, whether or not they have control over them.

How to Register Beneficial Ownership Information

How to download bof1 form from ecitizen

1. Log into e-citizen.
2. Under 'My Businesses', select the company.
3. Click on 'enter beneficial owners'.
4. Fill in the requisite details.
5. Add shareholding and voting rights as applicable.
6. Select complete.
7. Download forms for signing.
8. After signing, scan and upload the signed forms.
9. Review the application to verify the details entered are correct
10. Select Finish

Download step by step tutorial on how to get FORM BOF

What information is required for beneficial ownership?

Details of the beneficial owners required:

1. Identification details: Name, I.D/birth certificate/passport number
2. Contact details: postal address, phone number, residential address, email address
3. Personal details: KRA Pin, nationality, date of birth, occupation
4. Date when they became a B.O
5. Date when they ceased being a B.O
6. The Registrar may further require any other relevant details.

Penalty in default and registration deadline

The following are penalties for failing to provide BO information:

1. A fine not exceeding Kshs. 500,000
2. A fine of Kshs. 50,000 daily after the deadline.

The company and each of its officers will be fined individually. Officers include directors, company secretaries, and managers.

Who can access Beneficial Ownership information?

The BO register is confidential. It may be accessed as follows:

1. Upon request by a government authority such as the Attorney General; or
2. With the written consent of the company.

Credits: Lawyer Wangu