4,000 firms flouting rules
June 10 deadline
$3,300 fine due
Kuwait is expected to net nearly KD4.1 million ($13.5 million) from financial penalties imposed on 4,000 companies flouting transparency rules related to their ownership.
The government had given more than 150,000 businesses operating in Kuwait until June 10 to disclose what it terms as “the actual beneficiary or owner” as part of a crackdown on money laundering.
Kuwait’s Ministry of Commerce and Industry warned that companies would be subject to a penalty of KD1,000 ($3,300) if they failed to disclose the ownership information before the deadline.
Nearly 4,100 businesses have failed to comply with Tuesday’s deadline and have been told by the ministry to pay the fine, the Arabic language daily Al-Rai said.
The ministry is acting as per an Emiri decree in line with recommendations by the Paris-based Financial Action Task Force (FATF) with the aim of stepping up the fight against money laundering and the funding of terrorism, the report added.
In a recent statement, the ministry clarified that the actual beneficiary does not necessarily have to hold capital shares or voting rights in the company.
The beneficial owner may exert actual or legal control or influence through any means, whether direct or indirect, or may act as the company’s legal representative, it said.
“The purpose of declaring the beneficial owner is to promote transparency in economic and financial transactions.
“This initiative aims to ensure that such information is accessible to law enforcement agencies, judicial authorities, and regulatory bodies, in line with the recommendations of FATF,” it added.
In March the ministry warned businesses in Kuwait that they face heavy penalties or closure if they are found to be involved in money laundering or the funding of terrorism.
Kuwait issued its first comprehensive law in this regard in 2013. It imposes heavy financial penalties and prison terms of up to 10 years.
