Sources claim that the rush was brought on by banks locking the firm accounts because they didn’t update their information to reflect beneficial ownership by the deadline.
“There was a November, 30, 2023 deadline that was given to companies to have their bank account details updates with beneficial ownership. Many companies ignored this directive. On November, 30, all companies that had not updated their details had their accounts frozen by banks,” a source privy to the matter told the Bazzup News media.
After the deadline passed, banks proceeded to freeze the accounts of other companies, which prompted them to expeditiously amend their details with URSB.
A source at URSB has told this website that the government agency responsible for business registrations in the country has since last week seen a surge in application to update beneficial ownership details by companies.
“We receive an average of 500 applications per day but we expect this number to go up to 700 per day in the next few weeks,” the source said.
This website has also separately learnt that URSB has ensured the process is strict going through the information provided before an application is passed and this has ensured that not all applications can be processed in a day and consequently cross over to the next day.
The URSB head of public relations and corporate affairs, Denis Nabende confirmed a surge in the number of applications by companies to update their details.
“It is true we have seen an upsurge in applications for data updates on the Online Business Registration System (OBRS). We have however increased the number of staff working on this to speed up the processing of applications. We appeal for patience from clients as we deal with the huge volume of applications.
He noted that URSB has worked with the Uganda Bankers Association and carried out several trainings on company data updates and annual return filings to make it easy for companies to update their company details.
“We reiterate to clients that the exercise of data update is free and is done online via the Online Business Registration System (OBRS),”he added.
URSB earlier this year started enforcing laws that require companies and partnerships to declare the beneficial owners of the businesses.
This is in accordance with the Companies (Beneficial Ownership) Regulations of 2023 and the Partnership (Beneficial Owner) Regulations of 2023.
A beneficial owner is a natural person who has the final ownership or control of a company or partnership.
In this case, such a person is one who is not a registered director of an entity.
It can also mean a natural person on whose behalf a transaction is conducted in the company or partnership, including a person who exercises ultimate control over that entity.
It has always been common practice for a person to register a company, not in their names, nor do they usually appear anywhere in the operations or supervision of the company and the requirement is meant to check on this.
Therefore, the regulations that require for beneficial ownership were developed and implemented to partly to deal with money laundering and illicit finances as a response to calls on Uganda by the international anti-money laundering platform, the Financial Action Task Force (FATF), to improve her safeguards against money laundering, illicit financing, and terrorism funding.
The regulation is also one of the ways to ensure Uganda gets off the grey list for money laundering.