Criteria of beneficial ownership for a Foreign Company

​A person is a beneficial owner if he meets 1 or more criteria stated in the Guidelines. For the purposes of the beneficial ownership reporting where the individual meets more than 1 criteria, each criterion must be recorded accordingly. 

Criteria :

1. Criteria A - Holds directly or indirectly in not less than 20% of the shares of the company;
2. Criteria B - Holds directly or indirectly in not less than 20% of the voting shares of the company;
3. Criteria C - Has the right to exercise ultimate effective control whether formal or informal over the company or the directors or the management of the company;
4. Criteria D - Has the right or power to directly or indirectly appoint or remove a director(s) who holds the majority of the voting rights at the meeting of directors;
5. Criteria E- Is a member of the company and, under an agreement with another member of the company, controls alone a majority of the voting rights in the company; or
6. Criteria F- Has less than 20% of shares or voting shares but exercises significant control or influence over the company.

More information :

1. Guidelines for the Reporting Framework for Beneficial Ownership of Companies
2. Case Studies and Illustrations of the Guidelines for the Reporting Framework for Beneficial Ownership of Companies
3. Electronic Beneficial Ownership System ​(e-BOS)​​
4. Companies (Amendment) Act 2024
5. ​Practice Directive No. 9/2024: Lodgement of Beneficial Ownership Information under the Companies Act 2016 Through e-BOS
6. FAQ Beneficial Ownership​​
7. FAQ Companies (Amendment) Act 2024

Note :

1. ​In determining whether an individual is a beneficial owner, the shares to be considered must be ordinary shares. ​
2. Criteria A refers to the shareholding of ordinary shares as reflected in the register of members. 
3. Criteria B refers to the voting rights accorded to such ordinary shares which may differ as may be provided in the constitution.   
4. Under criteria F, even though an individual holds less than 20% shares in a company, he could still be a beneficial owner of the company if he fulfils criteria C, D or E.