Liberia publishes regulations on beneficial ownership transparency: our reflections

Active participants during a technical consultation session with data users, providers and collectors in Liberia

If there’s anything I’ve learnt from my engagement with and support to countries implementing beneficial ownership transparency (BOT) in Africa and elsewhere, it’s the fact that the implementation of beneficial ownership (BO) reforms is a truly iterative process. You just don’t get it right on your first attempt. As an emerging area of policy reform, this is to be expected.

Due to the dynamic nature of international standards such as the Financial Action Task Force Recommendations, or the new BO requirements in the Extractive Industries Transparency Initiative (EITI) Standard, legislating for BOT should be an evolving process as much as possible.

Three countries I've been supporting as part of my role as technical lead for BO implementation in Africa, Liberia, Nigeria, and Zambia, demonstrate this iterative approach well.

Liberia, 2020: initial enactment

In Liberia, beneficial ownership transparency was first legislated for in the amendment to the Associations Law of 2020. However, the beneficial ownership provisions in the Associations Law, as noted in our scoping assessment, were sparse. There were several gaps in the legislative framework which needed to be addressed, and Liberia began its journey to address these gaps by starting to develop a regulation on beneficial ownership transparency in late 2022. This journey has been and continues to be supported by the Opening Extractives (OE) programme, which the Government of Liberia signed up to and officially launched in July and September 2021.

Discussion among participants during a technical consultation session with data users, providers and collectors in Liberia

New regulation in 2023

In August 2023 Liberia published its regulation on the declaration of beneficial ownership information for domestic entities. The regulation provides for the collection, processing, verification, maintenance, publication and accessibility of beneficial ownership information of domestic entities. It was drafted in accordance with the Business Corporations Act of 2020.

This is a product of extensive consultation between government and non-government stakeholders which took place before the regulation was drafted, and after a draft was prepared.

The regulation stands as a testament to the commitment of government, civil society, media and international partners to advance BOT implementation under the OE programme and this certainly takes Liberia closer to improving transparency, particularly within the extractive sector.

Beneficial ownership transparency implementation continues to remain an evolving process in Liberia, There is also evidence of this iterative approach in other countries.

Nigeria

Nigeria established a beneficial ownership regime in 2020 through the Companies and Allied Matters Act (CAMA). In 2023, a beneficial ownership regulation was published which clarifies certain provisions of CAMA and provides more guidance on implementation.

Zambia

Similarly, Zambia first introduced provisions on beneficial ownership transparency in the 2017 Companies Act. The Act was amended in 2020 to clarify the definition of a beneficial owner, among other things. Currently, the Companies Act is undergoing amendments to further improve the framework for beneficial ownership disclosures.

Next steps for Liberia

The iterative process ultimately helps with achieving BOT implementation with impact. For Liberia, with a regulatory and legislative framework in place, the Beneficial Ownership National Steering Committee is now working towards establishing a beneficial ownership register before the end of 2023. Liberia is receiving technical support from the Stolen Asset Recovery (StAR) Initiative’s “Program on Enhancing Transparency of Beneficial Ownership and Raising Awareness of Beneficial Ownership Risks to Combat Money Laundering”. Sol Krause, Financial Sector Specialist at StAR, said: “Requiring companies to report their true owners or controllers, and making sure this information is checked and verified, is a critical step in the fight against transnational money laundering and corruption. We welcome Liberia’s significant progress in adopting strong regulations and building a register of beneficial ownership. We are pleased to be partners in this process.” The first iteration of the Liberia register will be launched at the end of September in Monrovia.

Press release on Liberia's register launch.