What is a beneficial owner?
According to Regulation 4(1)(a) of the Companies Act Regulations, 71 of 2008, a beneficial owner is defined as follows:
What is a beneficial owner? A beneficial owner is a natural person who ultimately owns or controls a company, either directly or indirectly. Specifically, a person is considered a beneficial owner if they:
- Hold a beneficial interest of 5% or more of the total securities in a class issued by the company. A beneficial interest gives the person the right or entitlement to receive or participate in distributions relating to the company's securities.
- Exercise or have the ability to exercise significant influence or control over the company. This includes: -- Being married in community of property to someone with a beneficial interest -- Being the parent of a minor child with a beneficial interest -- Acting under an agreement with someone else who has a beneficial interest -- Being the holding company of a company with a beneficial interest -- Being entitled to exercise or control the majority voting rights at the company's general meetings -- Giving directions or instructions to the company that the directors are accustomed to following.
In summary, a beneficial owner is any individual who ultimately owns or controls the company through their level of shareholding, ability to influence decisions, or relationship to other owners, even if indirectly or through other entities. Companies are required to maintain a register of beneficial owners with stakes of 5% or more.
Disclaimer:
Please note that the information provided does not constitute legal or professional advice, but rather the applicability of existing theory to a given practical situation. Due care is taken to ensure that the information is correct, but it remains subjective and an interpretation of application of information.