Announcement of Seychelles Beneficial Ownership Act 2020

eychelles Beneficial Ownership Act 2020

By Company Registrations Worldwide, 28th Oct 2020

On the 5th of March 2020, Seychelles passed two new regulations; the Beneficial ownership Act 2020 (BOA) and AML/CFT Act 2020 in replacement of AML Act 2006. Both laws will serve as a positive response of Seychelles to improve its anti-money laundering framework, boost clarity regarding beneficial ownership information to prevent misuse of corporate vehicles in Seychelles, and better align with global standards.

The Beneficial ownership Act 2020 (BOA) opened the executive opportunity for the creation of a centralized data centre for storing and managing information on beneficial ownership in Seychelles. The Financial Intelligence Unit (FIU) was put in charge of managing, maintaining, and safeguarding the security of the database.

The Beneficial ownership Act 2020 (BOA) will affect your obligations as an owner of a Seychelles International Business Company (IBC), as well as its possible effect on the anonymity of beneficial owner in the jurisdiction.

Duties of Seychelles International Business Companies 

The legal person and legal arrangement have a duty to recognize and verify information of its BOs. Additionally, upon receipt of such information from BOs, they must provide an update for registered agent registrable information in the specified form in 14 days.

After a person ceases to be a beneficial owner of the company, the legal person and legal arrangement must keep their information for at least 7 years. A company failing to comply with BOA will be liable for a penalty up to 50,000 SCR.

According to the 2020 Act, the following information must be included in the beneficial ownership register:

  • The name, residential address, service address, date of birth and nationality of each beneficial owner
  • Details of beneficial interest
  • The date on which a person became a beneficial owner
  • The date on which a person ceased to be a beneficial owner
  • The name, residential address, service address, date of birth and nationality of each nominee member (shareholder)

The Effect of the Beneficial ownership Act 2020 (BOA) on Entities

The Act relates to a legal person including a company or foreign company, an association, an IBC, a special license company, a partnership or a foundation incorporated in Seychelles under related Acts. The act additionally applies to a legal arrangement, for example, a resident trustee of an international trust or a general partner of a limited partnership but this act does not apply to a listed company on a securities exchange under Seychelles securities Act or an exchange licensed in a jurisdiction that is an ordinary member of the International Organisation of Securities Commissions (IOSCO), or a subsidiary of a body corporate, partnership or trust listed on securities exchanges as mentioned above.

Obligations of Beneficial Owners (BO) of Seychelles IBCs

Beneficial owner, corresponding to the Act, implies to one or more natural persons:

  • Who ultimately own or control a customer; or?
  • On whose behalf a transaction is being organized; or
  • Who exercises ultimate effective control over a legal person or a legal arrangement?

Every person must notify and provide information within 14 days when becoming a beneficial owner of the company or when there are changes in particulars of the beneficial owners.

 Failing to do so or intentionally providing false information will make BO subject to a fine not less than 50,000 SCR and/or imprisonment not exceeding 1 year. In addition, a BO will also face the following constraints from the company:

  • Rights to transfer shares or other interest
  • Voting rights
  • Rights to acquire additionally issued shares
  • Rights to payment of the interest in respect of capital of legal person or legal arrangement
  • Rights to take part in the management of the limited partnership
  • Benefit to which the owner of the foundation is entitled
  • Cancellation of the interest in the legal person or the legal arrangement
  • Other measures

What is centralized beneficial ownership database?

Beneficial ownership database is a data centre centrally managed by the Financial Intelligence Unit (FIU) for storing information of beneficial owners provided by the legal persons and legal arrangements via their registered agents. The data centre will not be made available for public examination. Only some public authorities in Seychelles are granted access to the database

Following capable authorities will have access to the database:

  • Anti-Corruption Commission of Seychelles.
  • Central Bank of Seychelles.
  • Financial Crime Investigation Unit or any other Unit as may be designated by the Commissioner of Police within the Seychelles Police Force.
  • Financial Intelligence Unit.
  • Financial Service Authority.
  • Office of the Attorney General.
  • Registrar of Associations.
  • Registrar of Companies.
  • Seychelles Revenue Commission.

The registered agent deliberately providing wrong information onto the data centre shall be subject to imprisonment at a maximum of 2 years and/or a fine of no more than 100,000 SCR. In addition, registered agents have the accountability to grant access to the information for some public authorities as per individual written request by such authorities:

  • FIU or the Financial Services Authority.
  • Any law enforcement agency.
  • Registrar of Associations.
  • Registrar of Companies.
  • Seychelles Licensing Authority.
  • Central Bank of Seychelles.
  • Order of a Court.

A resident agent who fails to provide specified information upon request will be subject to a fine not exceeding 50,000SCR per each failure. And a resident agent who intentionally provides inaccurate or misleading information as requested shall be liable to imprisonment not exceeding 2 years and/or a penalty of no more than 50,000SCR.

BOA’s effect on Anonymity of Seychelles IBCs

Before the legislation of the Act, all Seychelles IBCs had to keep its registers of directors, shareholders, and beneficial owners at the company’s registered address. Moreover, an IBC must only file its register of director with the Registrar. Though beneficial owner register was kept at the registered address, an IBC is still responsible for maintaining and keeping it up to date.

Upon passing new legislation, the responsibilities of beneficial owners and IBC itself virtually remain the same. However, the BOA makes way for a centrally managed database of beneficial ownership information submitted through resident agents. This data centre will help to facilitate access to information by competent authorities and law enforcement agencies. It will also make ease of exchange of information on request regarding beneficial ownership between Seychelles and international authorities.

Upon completion of the testing phase and the Platform is ready to go live, all legal persons and legal arrangements through its registered agent shall be notified of same. Similarly, the FIU aims to issue regulations to provide further guidance on the procedure for uploading information on the BO database, as per section 13(3) of the BO Act. The BOA will come into force on 31st January 2021. 

Company Registrations Worldwide can assist you to incorporate a company in Seychelles and meet all ongoing filing obligations. Please Contact Us or call+353 1 6874518, a member of our team would be happy to assist you.