Kenyan-based businesses must legally maintain a list of all the people who directly or indirectly own or control their firm in order to avoid fines of Ksh2,000 plus an additional Ksh100 every day all over the default timeframe.
The Anti-Money Laundering and Combating of Terrorism Financing Laws (Amendment) Act, 2023, states as much.
President William Ruto enacted the Act into law on September 1, 2023, requiring all businesses to disclose all of their stakeholders.
Part of the Act states, “Every entity is required to preserve records of its substantial owner’s knowledge for a period of not less than ten years from the moment in which the individual quits to be a beneficial owner.”
The Act also requires businesses, with the exception of publicly traded corporations, to provide a copy of any changes they make to their register of beneficial owners with the Registrar within fourteen days of the changes being made.
Within 30 days of the modifications being effective, publicly traded firms must notify the Registrar of Firms of any such revisions.
According to the Act, “a company that does not comply with the requirements will be liable to pay an administrative penalty of Ksh2,0000 to the Registrar, as well as each officer of the company in default.”
“The company and each officer of the company in default shall pay to the Registrar an additional administrative penalty of Ksh100 for each day of default if the company keeps neglecting to comply.”
Official documents must be maintained by company officers for seven years after dissolution, at which point the company’s name is struck from the official registry.
Furthermore, the Act establishes guidelines for small and medium-sized firms’ hiring practices.
Consequently, every company with paid-up share capital less than Ksh5 million is required to designate a permanent resident of Kenya as either a secretary, local director, or contact person.
On September 15, 2023, the Act became operative.