The Nigerian Upstream Petroleum Regulatory Commission (NUPRC) has directed all lease and licence holders operating in Nigeria’s oil and gas industry to submit the full list of real owners of their companies within seven days of the extant notice.
In the directive by the industry regulator, personally signed by its Chief Executive, Mr Gbenga Komolafe, the commission demanded that the information to be disclosed must include the identity (ies) of beneficial owner(s), the level of ownership, and details about how control is exerted.
The new directive released by NUPRC was tagged, “Notification No. 1 to All Licence and Lease Holders in Nigeria on the Requirement for Submission of Beneficial Ownership Information.”
As a member of the global Extractive Industries Transparency Initiative (EITI), whose standards are implemented by its Nigerian version, Nigeria Extractive Industries Transparency Initiative (NEITI), the federal government is expected to ensure the execution of the set standards in the oil, gas and mining industries through its agencies in the sectors.
Recently, Komolafe, while applauding NEITI’s efforts in the promotion of an open and accountable system in the management of extractive resources, explained that NUPRC and NEITI shared a common vision of transparency in Nigeria’s energy sector.
The NUPRC, he said, was fully committed to working with NEITI to deepen Nigeria’s implementation of contract transparency and beneficial ownership disclosures in the country in a bid to ensure that the revenues from natural resource assets supported national development and helped reduce poverty.
Komolafe stated, “At the NUPRC, we are implementing the beneficial ownership reporting system, as it is a statutory requirement, which demands full disclosure of beneficial ownership information.
“The commission is engaging the oil and companies to ensure their mandatory compliance.”
He maintained that the idea was to ensure that citizens were aware of who they were doing business with or competing against, adding that it will also encourage appropriate stakeholder engagement, which is a part of Nigeria’s open government action plan.
But in the latest notice, NUPRC stated that those to be affected by the notice included persons with significant control of at least five per cent shares and directly or indirectly holding the same percentage of voting rights, among others.
NUPRC said, “The commission hereby requires all entities that apply for or hold a participating interest in an exploration or production oil and gas licence, lease or contract to provide information of their owners, including the identity(ies) of their beneficial owner(s), the level of ownership and details about how that ownership or control is exerted.
“Accordingly, all relevant persons are hereby required to provide the information of persons with significant control over them: A person with significant control means any person directly or indirectly holding at least five per cent of the shares or interest in a relevant person.
“Or a (person) directly or indirectly holding at least 5 per cent of the voting rights in a relevant person; and directly or indirectly holding the right to appoint or remove a majority of the directors or partners in a relevant person.”
In addition, it stated that the significant persons were those otherwise having the right to exercise or actually exercise significant influence or control over a relevant person; or having the right to exercise, or actually exercising significant influence or control over the activities of a trust or firm, whether or not it is a legal entity.
NUPRC intimated all affected stakeholders that the information shall be provided using the beneficial ownership declaration form included in the notification.
The commission stated, “All current holders of participating interest in an exploration or production oil and gas license, lease or contract are hereby required to fill the beneficial ownership declaration form and send to the commission …not later than seven days from the date of this notification.
“All entities that henceforth apply for participating interest in an exploration or production oil and gas licence, lease or contract shall also be required to fill the beneficial ownership declaration form and submit with their application.”
It further explained that notice of change in persons in significant control over a relevant person shall be provided by the relevant person within 30 days of the change using the change in beneficial ownership declaration form