Plans by the Attorney General Kihara Kariuki to have companies submit a copy of beneficial owners register has been commended by the International Monetary Fund (IMF) as a right step to fight corruption and increase transparency in public finance.
The IMF staff team led by Mary Goodman made the commendation during a meeting with Treasury, Central Bank of Kenya and other government officials as Kenya awaits approval of the Executive Board for second disbursement amounting to Kshs. 43.9 billion ($410 million) as part of the approved Kshs. 250.4 billion ($2.34 billion) 38-month arrangements under the Extended Credit Facility (ECF) and the Extended Fund Facility (EFF) approved on 2nd April 2021.
“Noteworthy is that the authorities continue to push forward with their agenda to increase transparency and fight corruption. They will shortly publish an audit of all COVID-related expenditures in Financial Year 2019/2020,” Ms Goodman noted.
She went on, “They are also strengthening public accountability, and the public procurement portal should soon publicize comprehensive information on all firms that win procurement contracts, including the names of their beneficial owners. In addition, the authorities’ plan to adopt a common payroll system at the national and county level should help contain spending growth and limit the scope for corruption.”
The semi-autonomous Business Registration Service domiciled in AG’s office on 30th October 2020 had given firms until 31st January 2021 to keep the register containing information of owners and lodge the same with Registrar of Companies.
However, BRS Director General Kenneth Gathuma gave companies companies a grace period of six months until 31st July 2021.
“The Beneficial Owners Register will create greater transparency in the ownership of companies in Kenya and support the government in the fight against corruption, money laundering and financial terrorism,” said Gathuma.
IMF backs the loan facility to support Kenya’s long-term economic vitality and respond to shocks which have been triggered by COVID-19 pandemic with 2021 growth projection of 6.3%.