Transparency of beneficial ownership information continues to be a central concern for governments and the public, as demonstrated by media coverage surrounding data leaks in recent years (Panama Papers). These leaks have often demonstrated that the lack of transparency hid crimes. For example tax evasion, money laundering, terrorist financing or attempts to avoid potential sanctions. The “beneficial owner” (BE) is the “natural person”, the flesh-and-blood human being, who owns or controls a legal entity (e.g. a company, foundation or trust), whether directly or indirectly. Knowing who is behind a legal entity (or several of them) tells us who ultimately benefits from multi-billion FCFA contracts.

The establishment of a Register of Beneficial Owners (RBO) by countries implementing the EITI has three meanings in terms of governance of oil, gas and mining resources:
Firstly, knowing the Effective Beneficiaries allows public authorities to guarantee ownership of natural resources to the People, to reduce the possibilities of loss of income for the State, and to further mobilize revenues to finance development. The Beneficiary declaration can also help extractive sector regulatory bodies in decision-making.
Secondly, with regard to Civil Society, the identification of Effective Owners is an issue of transparency and accountability because it offers a means of accountability and the possibility of holding mining rights holders liable in the event of a breach to their obligations.
Third, for extractive companies, the disclosure of Beneficial Owners helps establish healthy competition through knowledge of the identity of all commercial partners.

Why declare the beneficial owners?
The declaration of beneficial owners aims to promote tax transparency and above all to combat money laundering and the financing of terrorism by allowing the competent authorities and bodies (tax administration, UEMOA banking commission, GIABA, CENTIF, the national committee of the initiative for transparency in the extractive industries, judicial authorities, etc.) to better understand the people who hold control of a company. This obligation also makes it possible to guarantee the transparency of companies and to facilitate commercial exchanges.

In Senegal, who is concerned by the declaration of beneficial owners?
All legal structures, whatever their legal status (SARL, SA, SCI, SCP, associations, NGOs, GIE, etc.) and their sector of activity, are concerned by this obligation. Indeed, according to the provisions of article 633 of the General Tax Code, legal entities are, whatever their form and activity, whether or not they are subject to tax, required to identify their beneficial owners and to keep a register to this effect at their headquarters in Senegal

  • Natural persons owning or controlling, directly or indirectly, the legal or natural person registered, or declaring its activity;
  • Individuals holding, directly or indirectly, at least 2% of the voting rights of the reporting company;
  • Natural persons exercising, by other means, a power of control over the management, administrative or executive bodies of the reporting company;
  • In the absence of identification according to the two preceding criteria, the beneficial owners are the natural persons who occupy directly or indirectly, in particular through one or more legal entities, the position of legal representative of the reporting company.
BENEFICIAIRES EFFECTIFS DES ENTREPRISES

OSIDEA, as a civil society actor in Senegal, attaches importance to transparency and good governance of the extractive sector, particularly in the context of oil and gas exploitation.

Progress in extractive sector transparency in Senegal has enabled CIPE to identify the right CSO actors (PWYP) leading BOT reform in Senegal, whose work assessing gaps in extractive sector transparency efforts provides insights useful information that will inform the dialogue on BOT within the framework of this project.

CIPE considers the CSO community ahead of the private sector in understanding the value of BOT to the economy and engaging in advocacy on this issue. This is evidenced by the fact that the weaknesses of the BOT reform framework in the extractive sector reflect a lack of private sector engagement to ensure adequate review and use of transparency mechanisms to conduct due diligence and ensure accountability.

Thus, the CIPE intends to rely on the Observatory for Monitoring Economic Development Indicators in Africa (OSIDEA) to strengthen advocacy on BOT to public authorities with better involvement of the national private sector and parliamentarians through monitoring and the evaluation of public policies.

In a context where we are talking about oil exploitation for the year 2024, Senegal attracts a lot of investors. To this end, offenses related to financial justice represent a significant threat to the integrity of our financial system.

Thus, it is essential for OSIDEA as a civil society organization to adapt its strategy and work with stakeholders (States, Parliamentarians, local elected officials, Members of civil society, Journalists, etc.) around the following challenges :

  • Encourage the adoption of significant measures aimed at strengthening the prevention of capital flight;
  • Raise awareness among young and female entrepreneurs on issues related to access to justice and the regulatory framework in the economic sector and mainly on issues related to the Actual Beneficiaries of Businesses;
  • Advocate for the strengthening of the system for repressing offenses linked to corruption and extortion;
  • Ensure that Senegal complies more with the standards set at the international level and more particularly in transparency in the extractive sector;
  • Strengthen access to information relating to the management of public affairs
  • Strengthen the protection of people who report these acts of corruption, enrichment, etc.
  • Strengthen the power of control bodies;
  • Support the authorities in the implementation and monitoring of recommendations regarding transparency of beneficial owners;
  • Strengthen or grant total autonomy to control bodies in order to avoid any bias
  • Avoid certain targets being assimilated to political figures.
  • Raise awareness in the justice system of the need to expedite access to information related to the Actual Beneficiaries of Companies;

OSIDEA is aware of the need to strengthen the knowledge of stakeholders on the country’s economic issues in order to better prepare them for their responsibilities.
One of the current objectives of the Observatory is to capitalize on its partnership with CIPE in order to strengthen its Support Project for Improving Access to Justice for Economic Actors in Senegal (PAMEJAS) financed by the German GIZ cooperation. It will allow us to be able to reach several targets that can participate in the improvement
Among the stakeholders targeted in the implementation of this Project, are:

  • the Ministries of Justice of Senegal
  • the Litigant Information Office,
  • Chambers of Commerce,
  • Entrepreneur Associations,
  • the Association of Women Magistrates of Senegal (AFMS),
  • the Association of Senegalese Jurists (AJS),
  • the Union of Magistrates of Senegal (UMS)
  • the Senegal Bar
  • the French Development Agency (AFD) through its Project to support civil and commercial justice in Senegal.

The Project aims to strengthen the capacities of economic actors and raise awareness among populations on issues of access to justice. These exchange and training frameworks could thus be privileged opportunities to improve their knowledge on the issues linked to the transparency of effective ownership in terms of appropriation of existing legal and institutional provisions at the level of Senegal.
This approach will make it possible to link up with the initiative which has already begun between the International Center for Private Enterprise (CIPE) and OSIDEA in the area of promoting the transparency of Beneficial Owners since 2022.

Lesson learned on the progress made in the current environment :
In terms of lessons learned, it is clear that there is a real desire on the part of States to combat financial crimes. The establishment of this legal arsenal in terms of economic justice is a means of deterring perpetrators of financial offenses but also helps ensure a peaceful investment climate. However, goodwill is not enough when it comes to such an important issue and the issues at stake are intrinsically linked to the development of a country. Efforts still need to be made to encourage citizens to cultivate tax morale, a culture of good governance and respect for the principles of transparency by drawing inspiration from best practices around the world.

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