Yes. A Kenyan company that never lodged its beneficial ownership register, or lodged it once and then let it go stale, is exposed to administrative penalties, prosecution and, where it ignores a Registrar’s directive to lodge, a route to being struck off the register of companies under section 894 of the Companies Act, 2015. The beneficial ownership register is a continuing obligation under section 93A, not a one-off filing, and the Registrar has already issued a public notice invoking that ground against companies that did not comply with a lodging directive.
What section 93A requires of every company
Section 93A(1) says every company shall keep a register of its beneficial owners, and section 93A(2) requires the company to enter the information prescribed in the regulations. The obligation to lodge a copy with the Registrar applies to a proposed company when it submits its incorporation documents and to existing companies within the period set in the section (section 93A(3)). Lodging is not the end of it. Under section 93A(5), a company other than a public listed company must lodge a copy of any amendment to its register within fourteen days after making the amendment. A public listed company has thirty days (section 93A(6)). Records of a beneficial owner’s information must be kept for at least ten years from the date the person ceases to be a beneficial owner (section 93A(7)).
The practical result is that a company which filed a correct register in 2024 can be out of compliance today. A new investor, a share transfer, or a change in who can appoint or remove directors changes the register, and the fourteen-day clock then runs.
Who counts as a beneficial owner
The Companies (Beneficial Ownership Information) Regulations, 2020 (Legal Notice 12 of 2020, as amended) define a beneficial owner as the natural person who ultimately owns or controls a legal person, or on whose behalf a transaction is conducted, including those who exercise ultimate effective control. The test is not satisfied by looking at the first name on the share register. “Ultimately owns or controls” covers ownership exercised through a chain of ownership or by means of control other than direct control.
Regulation 3(2) says a beneficial owner of a company is a natural person who, individually or jointly, holds at least ten percent of the issued shares directly or indirectly, exercises at least ten percent of the voting rights directly or indirectly, holds a right to appoint or remove a majority of the board, or exercises significant influence or significant control over the company. The Regulations define significant control to include control through informal means and through differential voting rights, and they note that a shareholding well below a specified threshold may still give a minority shareholder control. Regulation 3(2A) applies a separate test for companies limited by guarantee.
Under regulation 4, a company must give notice to a person it knows or has reasonable cause to believe is a beneficial owner, requiring the person’s particulars, and that person must comply within twenty one days of the notice. If the person does not, regulation 5 requires a warning notice, and regulation 7 requires the company to restrict the person’s relevant interest if the person has not complied within fourteen days of the warning notice. Nominee shareholders and nominee directors must disclose their status and the nominator’s particulars (regulation 4A).
How an unfiled register leads to strike-off
Section 894(1) lets the Registrar write to a company if the Registrar reasonably believes it is not carrying on business or is not in operation. Section 894(1A) lists grounds that may support that belief, including a failure to file annual returns or financial statements for five years or more, and a failure to lodge a copy of the beneficial ownership register after being issued with a directive under section 93A. Section 93A(12) allows the Registrar to give a directive to a company in breach of section 93A(3)(b), specifying the requirement breached, the action required, a fourteen-day period to comply and the consequence under section 894.
The Business Registration Service published such a notice on 11 April 2025, signed by the Deputy Registrar of Companies, citing both grounds in section 894(1A) and referring to Directive No. 1 of 2024, issued on 17 October 2024 with a compliance deadline of 30 November 2024. The notice required the companies on its list to confirm in writing within thirty days whether they were active. The statute then sets the sequence: a first letter, a second registered letter if there is no answer within a month, a Gazette notice if there is still no answer, and, at the end of the period in that notice (three months), power to strike the name off the register (section 894(2) to (4)). On publication of the striking-off notice in the Gazette, the company is dissolved (section 894(6)). The liability of every officer and member continues despite dissolution (section 894(7)).
Penalties for non-compliance
Section 93A(8) makes a company, and each officer in default, liable to an administrative penalty of two thousand shillings for failing to lodge an amendment on time, and section 93A(9) adds one hundred shillings for each day the default continues. Failure to comply with the initial lodging requirement in section 93A(3)(b) is an offence, with a fine of up to five hundred thousand shillings for the company and each officer in default, and a further fine of up to fifty thousand shillings for each day the failure continues after conviction (section 93A(10) and (11)). Individual officers are therefore personally exposed alongside the company.
What to check now
Confirm that the beneficial ownership register was actually lodged with the Registrar, not just prepared internally. Compare it with your current share register, board appointment rights and any voting arrangements, and amend it where ownership has changed. Check that notices under regulation 4 were issued to every person who may be a beneficial owner, and that responses are on file. Finally, check whether the company has any letter from the Registrar referring to section 894, because the time limits in that section start from the date of the letter.
How We Can Help
Clay & Associates Advocates can review your beneficial ownership register against the shareholding and control position of your company and advise on lodging amendments and responding to a Registrar’s letter. Our regulatory compliance practice advises on Companies Act obligations, and our article on outsourcing the company secretarial function explains how companies manage these filings. You can contact us to discuss your company’s position.
Sources: Companies Act, 2015, sections 93A and 894; Companies (Beneficial Ownership Information) Regulations, 2020, regulations 2 to 7; Business Registration Service notice of 11 April 2025.
Frequently asked questions
How soon must a company lodge a change to its beneficial ownership register?
Under section 93A(5), a company other than a public listed company must lodge a copy of the amendment within fourteen days after making it. A public listed company has thirty days under section 93A(6).
Can a company be struck off just for not lodging its beneficial ownership register?
Section 894(1A)(b) lists failure to lodge the register after being issued with a section 93A directive as a ground on which the Registrar may form a reasonable belief that a company is not carrying on business. Striking off then follows only after the letters and Gazette notice in section 894 and if the company shows no cause to the contrary.
Does striking off end the directors’ liability?
No. Section 894(7) preserves the liability of every officer and member, and the Court can still liquidate a company whose name was struck off.
Who is a beneficial owner if the shareholder is another company?
The Regulations look through the chain to the natural person who ultimately owns or controls the company, so the register must name individuals and not stop at the corporate shareholder.
