Preem & Partners | 29th August, 2023
The Nigerian government, through the Corporate Affairs Commission [“the Commission”], introduced the Open Central Register of Persons with Significant Control [the “PSC Register”], also known as Beneficial Ownership Register, on the 25th of May, 2023. The PSC Register is a public register that reflects the true ownership and control of companies and Limited Liability Partnerships [LLPs] in Nigeria and is accessible electronically on the company registration portal [“CRP”] of the Commission. The launch of the Register is rooted from section 10 of the Persons with Significant Control Regulations, 2022 [the “PSC Regulations”] which governs the operation of the Register.
A person with significant control [“PSC”], otherwise known as a beneficial owner1 is ultimately an individual who exerts significant control or influence over a Company an LLP – either directly or indirectly. To fall under the ambit of the PSC Regulations, the individual must meet the following requirements:
i. own or possess at least 5% issued shares in the company or interest in the LLP;
ii. hold at least 5% of the voting right in the company or LLP; or
iii. hold the right to appoint or remove majority of the directors in the company or partners in the LLP.[1]
The PSC Register, accessible to the general public at no cost,[2] holds profound significance. Stemming from Nigeria’s commitment at the Anti-Corruption Summit in London on 12th May, 2016, it serves as a crucial tool in combating corruption, illicit financial flows, and other illicit activities concealed within companies and LLPs.
By granting access to law enforcement, regulatory agencies, journalists, and media outlets, the PSC Register fosters transparency in Nigeria’s business landscape. This transparency strengthens the media’s role as societal watchdogs and encourages citizen engagement in corporate-public accountability and governance.
PSCs are obligated to inform the company or LLP of their control particulars within seven days of becoming a PSC or within seven days of any changes.[3] Subsequently, the company or LLP must notify the Commission and furnish it with the PSC’s particulars within one month. If a PSC fails to willingly provide their particulars, the company or LLP are mandated to compel the PSC to do so.[4]
The information of the PSC required to be indicated and submitted includes the following:
i. full name;
ii. national identification number;
iii. nationality;
iv. date of birth;
v. place of birth;
vi. telephone number;
vii. email address;
viii. residential address;
ix. service address;
x. PEP [politically exposed person] status [where applicable];
xi. occupation or profession;
xii. nature of ownership or control;
xiii. the date the PSC became a PSC;
xiv. the date on which the Commission is notified of the ownership or control interest held by the PSC;
xv. the date on which any person ceased to be a person with significant control, the date of death of PSC [where applicable, as it relates to cessation of significant control];
xvi. and any other relevant information that the Commission may require.[5]
Despite the submission of these information, the PSC Register does not display certain personally identifiable information such as National Identification Number [NIN], complete date of birth, residential address, phone number, email, photograph, place of birth, etc. This is in compliance with the privacy and data protection laws issued by the Nigeria Data Protection Commission.
The particulars/information indicated by the individual and the company or LLP must be accurate, complete and submitted within stipulated time.[6] False, inaccurate, non-submission or late submission of the particulars and information to the commission attracts penalties of up to N200,000 in fines and imprisonment of up to two years,[7] applicable to both the PSC, the company/LLP.
Non-compliance with the PSC reporting requirement also results in the company’s/LLP’s PSC Register with the Commission being labeled “inactive,” on Commission’s portal.[8] Additionally, the Commission may refuse to approve company/LLP registrations, approve annual return filings,[9] or issue “Letter of Good Standing” to the company.[10]
The launch of the PSC Register is commendable, especially considering its applicability to foreign companies and government-owned entities.[11] Notably, personal data beyond the PSC’s name, service address, occupation, date of notification, percentage of share or interest, are not revealed on the Register, safeguarding individuals’ privacy rights. The electronic mode of notification to the Commission [through the company registration portal], occurring during incorporation, amendment of control particulars, annual return filing, and other post-incorporation submissions,[12] facilitates compliance with the PSC Regulations and makes for seamless operation of the PSC Register regime.
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