STAFF WRITER
THE Namibian Chamber Commerce and Industry (NCCI) says it will continue engaging the Business Intellectual Property Authority (Bipa) to give a lifeline to the 140 000 businesses that are at risk of being deregistered in Namibia after failing to comply with the Beneficial Share Ownership Declaration.
NCCI Chief Executive Officer Titus Nampala told Namibia Business Review that the Chamber is encouraging business owners, both big and small, to comply with regulations although it bemoaned the challenges that such could bring on the overall expenses incurred by business owners in the country.
“Namibia is experiencing a renewed wave of entrepreneurial spirit among young people, with many economically active individuals engaging in what is commonly referred to as a ‘side hustle’ to supplement their monthly income. However, it has been noted that the country still has a high level of informality.
“Depending on how this status quo is defined, Namibia must gradually transition to a stage where all entrepreneurial activities, regardless of size, are recognised. This is not merely a matter of formalisation or regulatory requirement, but a crucial step to ensure that entrepreneurs are visible and can be supported in their growth,” Nampala said.
The beneficial share ownership declaration requires all businesses operating in Namibia to declare all shareholders who benefit from their operations.
The obligation of the Beneficial Ownership Declaration was established through amendments to the Companies Act of 2004 and the Close Corporation Act of 1998, and took effect in July 2023.
The Chamber believes that all regulatory requirements should be communicated well in advance and accompanied by effective nationwide awareness efforts. Additionally, a thorough assessment must be conducted to fully understand the financial and operational implications of compliance, as well as the time needed for enterprises to adapt. This will allow entrepreneurs, both large and small, adequate time to comply.
BIPA has been going through an intense public campaign programme encouraging business owners to comply with the regulations but announced through a statement two months ago that about 140 000 of the business registered with the authority were not yet compliant and faced the risk of deregistration through a phased approach Nampala said Namibia needs to enhance and promote a strong and innovative entrepreneurial culture, through a conducive operating ecosystem and a responsive regulatory framework.
“Such an environment will enable the country to achieve its economic aspirations and address the various economic challenges affecting society.
“In this regard, all economic facilitators, regulators, and policymakers must work in harmony to promote entrepreneurship in the country. Compliance with existing and emerging regulatory requirements is essential in creating a law-based environment. At the same time, it is crucial to remain mindful of the country’s stage of entrepreneurial development and the associated cost of compliance,” he said
Nampala said NCCI will maintain a continuous engagement process with various regulators, including Bipa and others, regarding the implementation of Beneficial Ownership regulations, with the aim of finding practical and amicable solutions to the challenges entrepreneurs face in complying with the law.
“The Chamber, therefore, appreciates the collective efforts being made towards the registration of beneficial ownership, as required by law, and supports its objective to promote transparency within the economy. The Chamber further acknowledges that these regulatory changes will impact the country’s entrepreneurial landscape and may impose cost burdens on businesses, particularly given the limited timeframe for compliance,” he said.
According to Nampala, the chamber will also proactively engage with offices, ministries and agencies, and other regulatory authorities to ensure that future regulatory changes are communicated on time and that the private sector is fully involved.
“This is crucial to ensure that the business community has sufficient time and resources to prepare and comply effectively. Finally, the Chamber calls on the broader business community to actively participate in policy consultations. It is essential that entrepreneurs and sectoral representatives are given a platform to assess and provide input on any proposed regulatory changes before they are implemented or passed into law,” he said.
In an earlier statement, Bipa highlighted that an order was issued in April, warning all defiant business owners of possible deregistration.
“In a directive issued on 11 April, Bipa notified all non-compliant entities of the risk of deregistration, effective from 16 May, if they fail to comply by this deadline. Deregistration carries substantial legal and financial ramifications for both the entity and its associated interests,” Bipa said.
It added that, “Deregistration can lead to adverse consequences, including the potential loss of existing contracts, especially those related to public procurement, possible restrictions or closure of business bank accounts, deterrence to potential investment, and increased vulnerability to legal challenges, particularly for entities involved in ongoing litigation,”
In Namibia, the Financial Intelligence Act makes it mandatory for all companies and close corporations at registration and annually, thereafter, to submit to the Registrar of Companies and Close Corporations, up-to-date information on beneficial ownership
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