Companies doing business in Nigeria are required by the Corporate Affairs Commission (“CAC“) to make some mandatory compliance filings failure of which may attract severe penalties including deletion of any defaulting company from the CAC’s Register of Companies in Nigeria.
In 2022, the CAC published the Persons with Significant Control Regulations, 2022 (the “Regulations”) in the exercise of its powers under the Companies and Allied Matters Act, 2020 (“CAMA“) and with the approval of the Minister of Industry, Trade and Investment. The objective of the Regulations is to provide an effective framework and procedure for the Government to gather, obtain and document relevant information on persons with significant control (also known as beneficial owners) of companies and limited liability partnerships (LLPs). The Regulations apply to all types of company and LLPs.
In furtherance of the above Regulations, the CAC launched a Beneficial Ownership Register (“BOR”) platform. The platform will make it easy to search for information on persons with significant control (PSC). PSCs are persons who have 5% or above shares of a company whether listed in the company’s records as shareholders or not. The CAC Registrar stated that “The BOR will provide a simple, precise, and user-friendly environment for the search and provision of information on persons with significant control (PSC), added that it is accessible in real-time via http://bor.cac.gov.ng,” In a statement issued by the Registrar-General of CAC, Alhaji Garba Abubakar, the move was in line with the Commission’s commitment to curtail illicit financial flows, fight corruption and ensure transparency in business ownership and operations in Nigeria.
The CAC has since begun the implementation of the BOR. In a press release on 12 July 2023, the Registrar-General announced that CAC shall soon commence striking off (i.e. deletion) of defaulting companies and firms from the Register of Companies for failing to comply with the obligations under the Regulation to submit information in relation to their beneficial owners.
In a question-and-answer format, we have put together what you need to know about the BOR.
1. What is the BOR?
BOR is a register that contains information about beneficial owners of companies in Nigeria. The BOR portal is an automated platform where records of PSC collated by CAC during company registration or post-incorporation filings are stored and accessible both to the general public and regulators. The BOR platform offers a search function and information on PSC in accordance with the international standard of beneficiary ownership data standards (BODS) under the guidance of the World Bank. A search of the BOR platform can be initiated with any or all of the following parameters: entity’s name, entity’s registration number, PSC first name, or PSC surname.
2. Who is a beneficial owner or person with significant control (PSC)?
A beneficial owner is the natural person who ultimately owns or exercises significant control over a Company or Limited Liability Partnership (LLP), whether directly or indirectly; or the natural person on whose behalf a transaction is being conducted.
Pursuant to Section 14 of the PSC Regulations 2022, beneficial owners are also recognized as Persons with Significant Control (PSC) in Nigerian companies. According to Regulation 14 of the PSC Regulations and provisions of Section 868 of CAMA, a person has a significant control over a company or limited liability partnership if he or she:
- is directly or indirectly holding of at least 5% of the shares or interest in the company or limited liability partnership;
- is directly or indirectly holding of at least 5% of the voting rights in the company or limited liability partnership;
- has direct or indirect right to appoint or remove a majority of the directors or partners in the company or limited liability partnership;
- has right to exercise significant influence or control over the company or limited liability partnership, and
- has right to exercise significant influence or control over the activities of a trust or firm whether or not it is a legal entity, but would itself satisfy any of the first four conditions if it were an individual.
3. What is the PSC Register?
The PSC Register is a public register kept by the CAC that shows the true ownership and control of all incorporated companies and LLPs in Nigeria. It is easy to ascertain the ownership and control of Companies and LLPs, as well as substantial shareholding of shareholders.
4. What kind of information is available to the public in the PSC Register?
The information to be made freely available to the public are as follows:
- full name of PSC;
- date on which the reportable ownership or control started;
- date of declaration of significant influence or control;
- occupation;
- service address;
- nationality;
- nature of ownership or control in the company or limited liability partnership; and
- unique identifier.
According to Regulation 10 of the PSC Regulations, information available to the general public on the PSC Register does not include Personally Identifiable Information (PII) like National Identification Number (NIN), complete date of birth, residential address, phone number, email address, etc. This is in compliance with the National Data Protection Regulation.
5. Who is obliged to submit a PSC’s information to CAC and when does the obligation arise?
Every person who becomes a PSC of a Company or LLP must disclose to the Company or LLP the particulars of its control or any change in the particulars of control within 7 (seven) days of acquiring or changing such significant control. The Company or LLP, in turn, must notify the CAC within one (1) month of receipt of the PSC’s information. The Company is also required to disclose it in its annual returns to the CAC and update its Register of Members.
Pursuant to Regulation 3 of the PSC Regulations, where the PSC is a government-owned entity, also known as State-Owned Entity (“SOE“), the PSC information to be submitted to CAC in respect of the SOE shall include the same information of the Chief Executive Officer (CEO) of the SOE as is required of an individual who is a PSC of a private company or limited liability partnership.
6. What is the mode of submission of PSC information to the CAC?
Information in relation to a person with significant control shall be submitted to CAC through any of the following modes:
i. during incorporation;
ii. filing of annual returns;
iii. at the occurrence of any change of PSC that may occur from time to time;
iv. at the point of notification of exemption (for a foreign-exempted company).
7. Are there sanctions for non-submission or late submission of PSC information?
Yes, there are sanctions for non-submission, late submission and false statements in PSC information. The sanctions as outlined in Reg. 12 of the Regulations include:
(i) Reflection of the status of the Company or LLP as “INACTIVE” on the PSC Register and other relevant online portals of the Commission;
(ii) Restriction on the relevant interest of the PSC;
(iii) Imprisonment for two years for non-submission of the information by the PSC to the Company or LLP;
(iv) Daily monetary sanctions against the Company or LLP and each officer of the Company or LLP after the one-month timeline for submission of the information to the Commission;
(v) Daily monetary penalty against the PSC after the seven days timeline for submission of the information to the Company or LLP;
(vi) Refusal by the CAC to process any post-registration application submitted by the Company or LLP until the default is corrected;
(vii) Refusal to issue “Letter of Good Standing” to the Company or LLP until the defaulter complies;
(viii) In the case of false statements to the Commission, two (2) years imprisonment for any officer of the Company or LLP so convicted.
8. What are the requirements for PSC filing with CAC?
The requirements for PSC submission are as follows:
- Date of appointment of PSC
- Details of PSC: This should include full names, addresses, gender, email address, phone number, date of birth, Tax Identification Number (TIN), national ID preferably NIN for nationals and international passport for foreigners.
- Any other information or document required by the CAC.
10. What is the cost for PSC filing?
The associated costs for filing PSC with the CAC is as follows:
| S/N | Particulars | Amount ( |
| 1. | Filing of PSC for private company, company limited by guarantee, limited partnership, limited liability partnership and incorporated trustees | 10,000 |
| 2. | Filing of PSC for public company | 15,000 |
Please note that the CAC may direct the company to file any outstanding annual returns or other compliance obligations before approving the filing of PSC information.
10. What is the timeline for completion of PSC filing?
PSC filing with CAC takes an average of 3 days.
Companies and firms are advised to notify CAC of change of PSC (if any) (especially companies and firms registered before the transition to online company registration).
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About KORIAT & CO.
We are a commercial law firm in Lagos, Nigeria with a network of lawyers and consultants in Kenya, Ghana and Rwanda.
The above article is not legal advice and does not automatically make our readers our clients unless they specifically instruct us to act or represent them in any way.
Please contact Koriat & Co. through admin@koriatlaw.com or 09067842241 if you require additional information about or assistance in incorporating a company or making the application for a business licence.
We are available to assist companies with filing of their annual returns, PSC information and other post-incorporation filings as well as regulatory compliance obligations.
