Disclosure requirement under amended section 90 of the Companies Act 2013, sets a deadline on 11th Sep, for all companies to disclose the names of individual to either directly or indirectly hold more than 10 per cent stake in the entity or exercise significant influence or control over its affairs.
It will no longer be possible to mask the ultimate beneficial ownership of the company. The new disclosure requirement under the companies significant beneficial owners rules 2018 which was notified on 13th June 2018 is aimed at bringing transparency in the manner in which the shares of companies are being held.
The Threshold limits for the disclosure of beneficial ownership of the entity in the SBO rules is 10 per cent of the shareholding visa-vis 25 in section 90 of the Companies Act.
The company is also required to file a return giving details about the significant beneficial owners with the registrar of the companies.
The return shall contain the name, address and other details about these beneficial owners. It has been made mandatory for every individual holding the beneficial interest of 10 per cent or more in the shares of the company or exercising significant influences or control to make a declaration to the company.
The penalty for failure to disclose is fine from 1 lakh to 10 lakh rupees.
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