Nigeria averts sanction, unveils BO register for transparency, accountability

…387 oil, gas, mining firms on-board as register goes live
In compliance with Extractive Industries Transparency Initiative (EITI) regulations, Nigeria yesterday, unveiled a beneficial ownership register in an attempt to deepen transparency and accountability in the extractive sector.

Requirement 2.5 of the EITI Standard (2016) specifies that by January 1, 2020, all member-nations must ensure that their oil, gas and mining companies that apply for, or hold a participating interest in an exploration or production of oil, gas or mining licence or contract publish the names of their real owners.

With the new development championed by Nigerian Extractive Industries Transparency Initiative (NEITI), from January 1st next year, beneficial owners in the mining, oil and gas sector according to EITI standard must be real, live persons; must not be a proxy or a nominee.

Such owners could be an individual who does not necessarily have an ownership stake in the company, but benefits economically from the company’s activities through other agreements or controls the company through means other than formal ownership stakes or voting rights as well as someone, who holds a certain number of shares or voting rights in a company.

Coming few days after President Muhammadu Buhari ordered the Accountant General of the Federation (AGF), Ahmed Idris, and all accounting officers to publish daily payments of N10 million while the ministries, departments and agencies (MDAs) must document any expenditure above N5 million, Nigeria may be heading in the right direction of Open Government Partnership (OGP) initiative, which Nigeria is a signatory.

The initiatives could be useless if Nigerians fail to hold government accountable on the basis of the information.

Executive Secretary of NEITI, Waziri Adio, who spoke at the launch of the initiative in Abuja, said the register is a practical and potent tool that countries could use to tackle tax evasion, corruption, conflict of interests, illicit financial flows, money laundering, and even drug and terrorism financing.

NEITI had stated that non-disclosure of beneficial owners was costing Nigeria and other developing countries about $1 trillion in shady deals.

Adio said: “It is good for resource-rich countries like ours. It is good for the citizens of such countries. And it is good for legitimate businesses. Ownership transparency advances the frontiers of transparency and accountability in more than symbolic ways.

“When these ills are reduced or eliminated, resource-rich countries will have more resources to invest in the welfare of their citizens and in physical infrastructure needed for individuals and businesses to thrive. Legitimate businesses, and most businesses are, also stand to benefit from knowing who they are doing business with, from reduced exposure to reputational risks, from having a level-playing field, and from improved trust in their operating environment.”