By Anthony Isaac
Disclosing the real owners of oil and gas, and mining assets in the country through the Beneficial Ownership register will reduce corruption, curb illicit financial flows and check tax evasion, the Federal Government has said.
The Minister of Finance, Budget and National Planning, Mrs. Zainab Ahmed disclosed this in Abuja at a round table on Beneficial Ownership Register in Nigeria organized by the Media Initiative on Transparency in Extractive Industries (MITEI) in partnership with the Nigeria Extractive Industries Transparency Initiative (NEITI).
Nigeria is due to unveil the beneficial ownership register on December 12 as part of its commitment to the global Extractive Industries Transparency Initiative (EITI) which placed a December 31 deadline for all member states to have the register in place.
Mrs. Ahmed explained that lack of transparency has been a long-standing issue in the global extractive industry, where anonymous companies (companies where the ultimate or beneficial owners are hidden) have been used to enable corruption, tax evasion, money laundering and other illegal activities in the sector.
According to her, “In Nigeria, we have experienced significant challenges in managing sector corruption, leading to significant loss of revenues, security challenges, and eroding public trust.
“The reality has served as a sobering wake-up call and resulted in a move towards establishing measures and standards that mandate the disclosure of the beneficial owners of such anonymous companies, and the coordinated development of a national public register in the extractive industries and beyond.
“These steps are in line with government’s priority area focused on fighting corruption and improving governance and moving towards an open, transparent, and citizen centred approach to policy-making and implementation”, she explained.
She pointed out that as member country of the EITI, Nigeria has made long-standing commitment to ensuring transparency in its extractive sector, stressing that under the Open Government Partnership (OGP), NEITI reinforced its commitment to the development of the beneficial ownership register, while the Corporate Affairs Commission (CAC), resolved to undertake a review of its laws to ensure disclosure of beneficial owners of companies in all public companies.
“Nigeria is therefore amongst the countries taking bold steps towards the use of public beneficial ownership registers as a critical policy-making tool in the fight against corruption, particularly in resource rich sectors such as the extractive industries”, she added.
On the importance of establishing a public central register of company owners, she said: “Through the establishment of such a central register, we will be better able to follow monies linked to tax evasion, corruption, drug trafficking, money laundering and terrorism financing. The resulting impact would be increased transparency, improve revenue collection and a reduction in corruption”.
Also speaking at the event that attracted the extractive sector regulators, civil society organisations and journalists, the Minister of State for Petroleum Resources, Chief Timipre Sylva said the push for beneficial ownership register in Nigeria accurately reflects the pulse of the ministry’s stands on the need for transparency in the sector.
Sylva who was represented by his Chief of Staff/Senior Technical Assistant, Engr. Moses Olamide, stressed the need for openness in the industry.
The minister said there is need to clearly identify the key players in the Oil and Gas Industry with a view to understanding the “identity of who does what, where and how.”
He further reiterated that the current effort at reviewing the Petroleum Industry Bill captures Beneficial Ownership with a view to creating an Open and Globally aligned process that will ensure transparency.
In his lead paper, the Executive Secretary of NEITI, Waziri Adio, stressed that setting up a national beneficial ownership register is only a means to an end, pointing out the need for such to be an all-inclusive document.
Addressing the issues of the absence of legal backings to compel disclosure of company ownership, Adio stated that the laws establishing regulatory agencies in Nigeria empower them to make bye-laws and policies which are banding on stakeholders.
Speaking during a panel session, the acting Registrar-General of CAC, Azuka Azinge said the requirements for beneficial ownership register are adequately provided for in Sections 119, 791 and 868 of the Companies and Allied Matters (Repeal and Re-enactment) Bill 2019.
Azinge who was represented by Peter Nyaw Gai stated that when the issues concerning the bill are sorted out, a proper legal framework or foundation for implementation should have been laid for the enforcements.
“Beneficial ownership is currently not only in the front banner of the global space but an absolute necessity to ensure transparency and accountability, integrity of financial system and check corruption, money laundering and financial terrorism”, he added.
Earlier, the National Coordinator of MITEI, Mr. Bassey Udo said beneficial ownership register would open up the industry to public scrutiny and accountability.
He added: “We believe when our God-given minerals are honestly mined by people we know and their proceeds equitably used for the purposes that God gave to us, we will have less strife; there will be jobs for our people; our schools will have happy teachers and books; our hospitals will have drugs for the sick, while other infrastructures engenders national economic growth and prosperity. That is why we are here”.