Beneficial Ownership Transparency in Africa in 2022

39 Pages Posted: 21 Mar 2023 Last revised: 19 Apr 2023

See all articles by Rachel Etter-Phoya

Rachel Etter-Phoya

Tax Justice Network; University of St Andrews

Njutapvoui kpoumie Idriss Hamed

The Tax Justice Network

Francis Kairu

Tax Justice Network Africa

Florencia Lorenzo

Tax Justice Network

Eva Danzi

Tax Justice Network

Date Written: March 13, 2023

Abstract

Beneficial ownership transparency is gaining ground in Africa. At the start of 2023, 23 of 54 African countries have laws and regulations requiring the real people - the beneficial owners - behind legal vehicles to disclose themselves to a government authority. More than half of the continent has committed to publicly disclose the beneficial owners in sectors prone to corruption and fraud: public procurement and the extractive industries.

Lifting the veil of secrecy that shrouds the owners of companies, partnerships, trusts and foundations is a central tool for African governments to tackle illicit financial flows. The case studies included in this paper - from Cameroon, Kenya, Liberia, and Senegal - show the impacts of beneficial ownership transparency or the consequences of its absence. The absence of beneficial ownership transparency may have helped facilitate the capture of state resources and minerals by politically connected elite, and the theft of funds meant for responding to the Covid-19 pandemic.

In the wake of the scandals illustrated in the case studies, African nations introduced new laws for beneficial ownership transparency or sealed loopholes in existing legislation.

This paper examines the commitments of all African countries to beneficial ownership transparency. It delves more deeply into the 18 African jurisdictions covered by the Tax Justice Network’s Financial Secrecy Index 2022. This includes assessing who has to register, when they have to register, and if the public has access to information on the real owners of companies.

For effective beneficial ownership transparency, African countries can take further action, as outlined by the Tax Justice Network’s Roadmap for Effective Beneficial Ownership Transparency. For beneficial ownership transparency to help in the fight against illicit financial flows, all owners of all legal vehicles need to register and keep their information up to date with a government authority. All information should be accessible to the public, and there should be rigorous verification mechanisms in place and sanctions that are strong enough to act as a deterrent.

Keywords: Anti-corruption, beneficial ownership transparency, Africa, tax abuse, money laundering

JEL Classification: [F63], [H26], [K20]

Suggested Citation

Etter-Phoya, Rachel and Hamed, Njutapvoui kpoumie Idriss and Kairu, Francis and Lorenzo, Florencia and Danzi, Eva, Beneficial Ownership Transparency in Africa in 2022 (March 13, 2023). Available at SSRN: https://ssrn.com/abstract=4395017 or http://dx.doi.org/10.2139/ssrn.4395017

Rachel Etter-Phoya (Contact Author)

Tax Justice Network ( email )

38 Stanley Avenue
Chesham, Bucks HP5 2JG
United Kingdom

HOME PAGE: http://taxjustice.net/

University of St Andrews ( email )

St Andrews, KY16 9AL
United Kingdom

Njutapvoui kpoumie Idriss Hamed

The Tax Justice Network

Francis Kairu

Tax Justice Network Africa

Florencia Lorenzo

Tax Justice Network ( email )

Eva Danzi

Tax Justice Network ( email )

Israel

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
130
Abstract Views
482
Rank
404,334
PlumX Metrics