Beneficial ownership transparency and data protection in South Africa

Conclusion

BOT serves a legitimate purpose and is not overtly in contravention of POPIA. This is because disclosure of BO information is a necessary measure in combating financial crimes and the misuse of corporate entities and is thus in the public interest. Existing literature supports the position that BOT does not overtly contravene data protection legislation. Moreover, POPIA provides for the application of the provisions of POPIA, permitting the processing of personal information which is in line with legal obligations and exemptions for certain functions, such as those related to combating financial misconduct, contained in POPIA.

However, as lawmakers and regulators in South Africa develop the necessary legal and regulatory frameworks to meet specific policy aims, including complying with FATF’s Recommendations on BO disclosure, it is critical to ensure that the provisions and purposes of POPIA are not contravened. It is important that, in implementing BOT policies and creating BO registers, measures are made to mitigate the potential negative effects of: collecting personal information; processing, including storing and analysing, that information; and providing public access to that information. These measures can be implemented whether South Africa opts for a non-public BO register that is only accessible to competent authorities, or a publicly accessible register publishing certain data fields.