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Pakistan intensifies its efforts against money laundering with UBO register

Chris Hamblin, Editor, London, 3 September 2018

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The Securities and Exchange Commission of Pakistan has issued Circular No 16 of 2018, with a view to maintaining a register of ultimate beneficial ownership of 'legal persons.' Private banks and other wealth managers will have to take heed of the new rules on behalf both of their own shareholders and of the holdings of their customers.

The regulator has issued the circular to all companies, activating an obligation they have to comply with s453 Companies Act 2017. The circular has directed all the companies having legal persons as their members/shareholders to obtain and maintain up-to-date information relating to their ultimate beneficial owners, i.e. natural persons who ultimately own or control them.

Section 453 requires every officer of a company to endeavour to prevent the commission of any fraud or offences of money laundering, including the countless predicate offences listsed in the Anti-Money Laundering Act 2010 (VII of 2010) with respect to the affairs of his company.

The minimum information to be maintained in the register includes the beneficial owner's full name, his/her father's or husband's name, NIC/NICOP/passport number, nationality, country of origin (in case of foreign national or dual national), email address (if available), usual residential address, the date on which the name was entered in the register and the date on which the person ceased to be a beneficial owner, along with reasons for this cessation. In exceptional cases where no natural persons are identified and the company has to give information about its senior managing official(s), this is to include date of birth, NIC/NICOP/passport number, nationality and residential address.  

Companies have to obtain the ultimate beneficial ownership information from their members and also maintain and update this information on a register of beneficial ownership. The information has to be obtained and maintained "irrespective of the number of levels of ownership pattern, until the natural person exercising ultimate ownership or control and lying at the end of the ownership chain is revealed."

The circular contains "minimum fields of information" that the companies have to fill in. If they are unable to identify any natural persons having exhausted all possible means, or if there is any doubt that the persons they have identified are the beneficial owners, they ought to put the names of the natural persons who act as their senior managing officials on the register of beneficial ownership.

The regulator has issued the circular to help Pakistan comply with the Financial Action Task Force's 40 recommendations, which serve as the foremost international  standards for the fight against money laundering. Pakistan is a member of the Asia Pacific Group, a FATF-style  regional body.

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