‘Nigeria lacks legal framework to prosecute non-disclosure of beneficial ownership’ —Rafsanjani

By Abubakar Jimoh

The Civil Society Legislative Advocacy Centre (CISLAC) has hitherto been involved in series of interventions on Beneficial Ownership disclosure with specific focus on the extractive sector as a means to promoting Transparency and Accountability, curbing Illicit Financial Flows and promotion of tax transparency. At a Global Forum for Asset Recovery (GFAR) held recently in Washington, USA, the Executive Director of CISLAC made some disclosures on Nigeria’s progress in Beneficial Ownership transparency.

 There are indications that beneficial owners hide behind legal person members of a company in the award of contracts without being identified in Nigeria.

This disclosure was made by the Executive Director, Civil Society Legislative Advocacy Centre (CISLAC), Auwal Ibrahim Musa (Rafsanjani) at Global Forum for Asset Recovery (GFAR) held in Washington, USA.

The Executive Director, who was also a Nigerian delegate at the Forum, bemoaned absence of legal requirement for Nigerian companies to maintain a register of Beneficial Ownership.

He said: “In Nigeria, beneficial owners can hide behind legal person members of a company without being identified. No legal requirements for Nigerian companies to maintain a register of Beneficial Ownership.

“We don’t have established Central Register of Beneficial Ownership information and no clear rules on access for all law enforcement and tax agencies to Beneficiary Ownership information are available.

“We don’t have legal framework for prosecution of non-disclosure of beneficial owner is available.

Citing the Nigeria’s oil and gas sector as a case, the CISLAC’s boss explained that Nigeria as the world’s fifth largest producer of oil lost an estimated 9 billion USD since 2013 through shady practices in the oil and gas industry.

“Many of the names contained in the register of companies operating in Nigeria’s oil and gas industry are not the real owners.

“Although it is a legal requirement to submit the names and details of directors/ shareholders of a company before it can be registered, this is regarded as a mere formality;

“Lack of transparency allows influential officials to use their positions to extract maximum rent from a country’s mineral resources with minimum or no benefit to the citizens. A case in point is OPL 245 and Malabu Oil,” he added.

The Executive Director berated the continued loss of the nation’s revenue to malicious tax incentives offered by the government to multinational corporations, giving chances to illicit financial flows.

 “Nigeria may have lost as much as around 50 billion USD annually to illicit financial flows through money laundering, tax evasion and corruption.

“Oil and gas, and others companies with unclear owners enjoy tax holidays, credits and tax breaks on the expense of potential state revenues,” he added.

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