Control based SBO identification beyond the current legislation

Critical analysis of a recent RoC’s Order u/s 90 of the CA, 2013

– Neha Malu, Deputy Associate |


The requirement of identification of Significant Beneficial Owners (“SBOs”) for companies in India kicked in with effect from 13th June, 2018[1]. It marks its origination based on the recommendations issued by the Financial Action Task Force (“FATF”). However, since its inception, neither the regulator nor the regulatees have been able to take a sigh of relief when it comes to implementing the directive for identifying an SBO for their company. There were several rounds of amendments[2], followed by extending the requirement to identify such SBO for LLPs[3] and thereafter introducing the concept of ‘designated persons’[4] for sharing the information of beneficial owners. Not only that, but to ensure companies do not miss their identification spree, the RoC has been sending advisory to several companies since the last year being 2023 seeking clarification on why they have not or whether they have identified the company’s SBO.

In the present article, the Author discusses the legal framework governing SBOs in the Indian parlance with a specific focus on the identification of SBOs who have or is said to have control  without any shareholding or voting rights in the light of the Adjudication Order[5] issued by the Registrar of Companies, NCT of Delhi and Haryana (“ROC”), in the matter of LinkedIn Technology (“Order”) and also delves into the discussion under the FATF guidance in this respect.

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