What constitutes a beneficial owner?
A beneficial owner, as defined by Section 4 (1) of the Financial Intelligence Act 2012, refers to a natural person who either ultimately owns or controls a customer or transaction or exercises ultimate effective control over a legal entity such as a company or trust. This definition encompasses various scenarios, including direct and indirect ownership or control.
According to Schedule 5 of the Financial Intelligence Bill, individuals falling under the following categories are considered beneficial owners:
- Those on whose behalf a transaction is conducted.
- Individuals holding 25 percent or more of shares, voting rights, or other ownership interests.
- Senior managing officials within the entity.
- Those exercising joint control over the legal person.
- Individuals with the power to appoint or remove most of the board of directors.
- Persons with significant influence over decision-making or policy.
- Those deriving economic benefits from the entity.
- Individuals exerting influence or ultimate control through other means.
The beneficial ownership declaration: when and how to submit.
To facilitate compliance with these reporting obligations, BIPA has introduced the Beneficial Ownership Declaration Form (BO form), comprising three sections:
- Section A: Company information and type of beneficial ownership.
- Section B: Details of beneficial owners and attestation.
- Section C: Completion notes.
Entities registered or seeking registration with BIPA must submit the BO form under these following circumstances:
- During the registration process.
- Within seven working days of any material change in beneficial ownership information.
- Annually, at the end of each financial year.
- During the first transaction or amendment with BIPA after August 7, 2024.
- Concurrently with the filing of the entity’s annual duty with BIPA.
Signing and documentation requirements
The BO form must be signed by the director, shareholder, or member of the entity. If the entity engages the services of an Accountable Institution (AI) (such as FHC Consultants Namibia (Pty) Ltd) both the AI and the entity’s representative must sign the form.
Additionally, each beneficial owner’s passport or ID card copy must be certified and submitted along with the BO form. If an AI signs the form, proof of registration with the Financial Intelligence Centre is also required.
Seeking assistance and ensuring compliance
In a landscape increasingly emphasizing transparency and accountability, adherence to beneficial ownership reporting requirements is essential. By fulfilling these obligations diligently, entities not only uphold regulatory compliance but also contribute to fostering integrity and trust within the business environment.
For further clarification or assistance regarding these mandatory reporting obligations imposed by BIPA, entities are encouraged to reach out to Arné Bester at FHBC Consultants Namibia (Pty) Ltd via email at arne@fhbcnam.com.