Financial Crime World

UGANDA MOVES TO ENHANCE TRANSPARENCY WITH NEW BENEFICIAL OWNERSHIP REGULATIONS

Kampala, Uganda - January 2023

The government of Uganda has taken a significant step in enhancing corporate transparency by introducing new regulations on beneficial ownership. On January 5, 2023, the Honorable Minister of Justice and Constitutional Affairs, Norbert Mao, signed two new regulations: The Companies (Beneficial Ownership) Regulations and The Partnership (Beneficial Owner) Regulations.

What are Beneficial Ownership Regulations?

Beneficial ownership regulations require companies and other legal entities to disclose information about their true owners, including natural persons who ultimately own or control the entity. This includes individuals who exercise ultimate control over a company, partnership, or trust.

  • A beneficial owner is defined as a natural person who:
    • Owns or controls 25% or more of the shares in a company
    • Exercises significant influence or control over a company
    • Receives significant economic benefits from a company

Key Features of the New Regulations

The Companies (Beneficial Ownership) Regulations and The Partnership (Beneficial Owner) Regulations introduce several key features, including:

  • Requirements for companies to maintain a register of beneficial owners, which must be kept at the Uganda Registration Services Bureau (URSB)
  • Obligations on directors and officers to provide accurate information about beneficial owners
  • Sanctions for non-compliance with the regulations

Impact on Uganda’s Economy

The introduction of these regulations is expected to have a significant impact on Uganda’s economy by:

  • Reducing illicit financial flows and money laundering
  • Improving transparency and accountability in corporate governance
  • Enhancing investor confidence and promoting economic growth

Conclusion

The new beneficial ownership regulations are a critical step towards enhancing corporate transparency in Uganda. They will help to prevent the misuse of anonymous companies for illicit financial activities, promote economic growth, and reduce poverty. The government’s commitment to implementing these regulations demonstrates its dedication to combating money laundering and ensuring that Uganda’s economy is transparent and accountable.