More than 100,000 companies axed off CIPA’s register
Re-registration ends with 47.6% of companies complying
More than 200,000 business names struck off No further extension, CIPA says
About 117,000 companies have been struck off the Companies and Intellectual Property Authority (CIPA) register after the December 2 deadline to re-register on the Online Business Registration System elapsed.
BusinessWeek has learnt that another 200,846 business names were also removed from CIPA’s books in line with the deadline.
Under the provisions of several Acts passed in 2018, any company that did not migrate to the Online Business Registration System (OBRS) was due to be de-registered after December 2. The Investment, Trade and Industry ministry had provided a six-month extension from June 2, to cater for movement restrictions caused by the coronavirus (COVID-19).
With the deadline’s expiry, there will be no provision for ‘dormant’ companies; all companies in Botswana will either be active and registered online or de-registered.
The policy move is part of government’s effort to plug money laundering loopholes and also enhance the ease of doing business.
On Wednesday, CIPA awareness and communication manager, Marietta Magashula told BusinessWeek there would be no further extensions of the registration period. Those who missed the deadline may apply for a restoration of their business names with compelling reasons why they missed the re-registration if they have not already been allocated to new investors.
Magashula said 105,845 or 47.6% of companies, and a total of 18,990 or 8.6 percent of business names had re-registered before the deadline.
“We must emphasise that there was no expectation of 100% compliance due to reasons such as that the company or business may have never operated,” she said.
“(In addition) the shareholders/proprietors may have passed on and consequently the business ceased to operate.
“Some companies/business names may have been registered specifically for tenders that were never won, and then abandoned as a result.”
Magashula said some companies/business names may have been registered in order to carry out a specific project or tender and then ceased to operate following closure of the project/tender.
Company secretaries, meanwhile, were in the business of registering and selling off shelf companies, and may not have re-registered those that remained unsold.
Previously, company secretaries told BusinessWeek that some businesses had expressed discomfort with the new statutes requiring them to disclose their beneficial owners as part of the re-registration exercise.
According to Armstrong Attorney’s pupil attorney, Kagi Mogae, the introduction of amendments around beneficial owners was designed to squeeze loopholes in the law for money laundering and other practices. A ‘ beneficial owner’ is defined as a person who directly or indirectly, through any contract, arrangement, understanding, relationship, or otherwise is the ultimate beneficiary of a share or other securities in a company, he said.
“The law requires that companies disclose who their beneficial owners are to ensure that they are not being used as a vehicle for money laundering, terrorist financing, or other illegal activities,” Mogae said in a previous commentary.