DISCLOSURE OF SIGNIFICANT BENEFICIAL OWNERS (India)

Author: Rashmi Grover

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Publisher: Nagashima Ohno & Tsunematsu

Journal / Book: NO&T Asia Legal Review No.3 (August, 2018)

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*Please note that this newsletter is for informational purposes only and does not constitute legal advice. In addition, it is based on information as of its date of publication and does not reflect information after such date. In particular, please also note that preliminary reports in this newsletter may differ from current interpretations and practice depending on the nature of the report.

Background
In compliance with India’s obligations to align its regulatory framework with the recommendations of Financial Action Task Force, an intergovernmental organisation constituted to formulate policies to combat money laundering and terror financing, the Ministry of Corporate Affairs, in June 2018, notified Section 90 of the Companies Act, 2013 (“Companies Act”) and also introduced the Companies (Significant Beneficial Owners) Rules, 2018 (the “SBO Rules”).

Similar to other jurisdictions, the intent behind introduction of the SBO Rules is to prevent use of companies as mere conduits for money laundering or other illegal activities and to bring transparency regarding the ultimate ownership of companies.

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