The Seychelles Beneficial Ownership Act, 2020 (“BO Act”) and The Seychelles Beneficial Ownership Regulation, 2020 (“BO Regulation”) came into effect on 28 August 2020. Legal person or legal arrangement, including International Business Companies (here refers to the “Company”), must identify its beneficial owners and report the requested details to the Financial Intelligence Unit (“FIU”).
Under the new Act, every company is required to take the following action:
Identifying the Beneficial Owner and Legal Owner
The following are the definition of Beneficial Owner and Legal Owner:
(1)
Beneficial Owner
Pursuant to Sec. 3 of the BO Act, beneficial owner refers to one or more natural persons who ultimately own or control a customer or the natural persons on whose behalf a transaction is being conducted and includes those natural persons who exercise ultimate effective control over the company. That said, it refers to the natural persons who ultimately own more than 10% of the shareholding or have the ultimate control over the company.
Further explained by the Regulation, beneficial owner means a natural person who:
(a) ultimately has a controlling ownership interest of 10% or above in a company; or
(b) exercise control of the company through other means.
If no natural person meets the above statements, the natural persons who hold the position of a senior managing official of the company will be classified as the beneficial owners.
The company may adopt Cascading Test (also known as the three-tiered information-gathering approach) by Organization for Economic Cooperation and Development (“OECD”) to ensure the availability of beneficial ownership information.
(2)
Legal Owner
Similar with beneficial owner, legal owner also refers to the entity that holds shares, other rights or interest on behalf of other persons. The major different is legal owner can be a corporate structures, legal arrangement or legal person, but the beneficial owner must be a natural person.
The natural person that has ultimate control of legal owner is also considered as the beneficial owner.
Companies are required to identify the legal owners in order to further identify the beneficial owner. Nominee is considered as one of the legal owner. If interest is held by nominee, the information of each nominee must be included in the Register of Beneficial Owners.
Preparing Required Document and Requirement
Provided by the Regulation, every company must prepare and provide a completed and signed Declaration of Beneficial Ownership by each beneficial owner and a Register of Beneficial Owner with a special format.
For your reference, the following are the minimal information that needs to be provided in order to prepare the required document:
(1)
Name of Company
(2)
Company Identification Number (“CI no.”)
(3)
Particular of Beneficial Owner
(a) Name
(b) Residential address
(c) Service address
(d) Date of birth
(e) Nationality
(4)
Whether interest is held by nominee (if so, the information of item (a) – (e) of the nominee and nominator should be provided)
The mentioned document will be submitted to FIU for the purpose of establishing a secure and centralized Register of Beneficial Owners of each Seychelles Entities. The information of the beneficial owners nor the legal owners is inaccessible to the public.
Change of Beneficial Owner
Whenever there is change on beneficial owner, it is the beneficial owner’s obligation to inform the company within 14 days starting from the date of change of beneficial owner and its particular. The Declaration of Beneficial Ownership and updated Register of Beneficial Owners should be submitted to the FIU within 14 days starting from the notice of change received from the beneficial owner.
You should inform us and provide the information listed on item 2 so that we could prepare the Declaration of Beneficial Ownership (if applicable) and update the Register of Beneficial Owners accordingly.
If the beneficial owner does not fulfill its obligation, the company may take any action it deems appropriate under Sec. 10 (４) of the BO Act.
Important Date and Keynote of the Regulation
Existing companies are required to comply with the Regulation by filing a Register of Beneficial Owners and Declaration of Beneficial Ownership by 31 January 2021.
New companies formed on or after the mentioned date are required to comply with the Act and Regulation immediately.
Since time is running short, you are required to identify and provide the relevant information and documents as soon as possible to comply this new Regulation.
If you are interested to know more about the BO Act or the BO Regulation, please refer to the link below:
