With effect from 31 March 2017, companies will be required to maintain beneficial ownership information in the form of a register of registrable controllers, and to make the information available to public agencies upon request.
Existing companies will be given a transitional period of 60 days from the date of commencement of the new law (31 Mar 2017) to set up the register of controllers, after which they must have and continue to maintain the required registers.
Companies incorporated on or after 31 Mar 2017 will have a transitional period of 30 days to set up the register.
Who is a “Controller”?
A Controller is defined as an individual or a legal entity that has a “significant interest” in or “significant control” over the company.
A controller who has significant interest in a company with share capital when he/she has:
- Interest in more than 25% of the shares or
- Shares with more than 25% of total voting power in the company
A controller who has significant control on a company when he/she:
- holds the right to appoint or remove directors who hold a majority of the voting rights at directors’ meetings;
- holds more than 25% of the rights to vote on matters that are to be decided upon by a vote of the members of the company; or
- exercises or has the right to exercise significant influence or control over the company.
What needs to be done
Companies are required to take reasonable steps to identify their controllers and obtain information on the controllers by sending out notices to:
- anyone whom they know or have reasonable grounds to believe to be controllers,
- anyone who knows the identity of the controllers or is likely to have that knowledge.
Companies are required to enter information into their registers of registrable controllers within 2 business days after receiving replies from controllers to notices sent by companies.
As part of the annual return filing, companies are required to declare whether the company is keeping its register of registrable controllers at its registered office or the registered office of its appointed registered filing agent.
Maximum penalty for non-compliance is $5,000.
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