The Registrar of Companies now says Rwandese Investor Desire Muhinyuza is the beneficial owner of disputed Sh 400 M StayOnline Kenya Ltd.
In the case, Desire has sued Kenyan shrewd businessman Kirimi Koome for refusing to relinquish the firm back to him claiming he had agreed to register the company on his behalf.
In a witness statement filed in court, Hiram Gachugi Senior Assistant Registrar of Companies at Business Registration Services(BRS) says from the facts Desire is the beneficial owner.
“From the foregoing, to assist the court, it is clear that there is a tussle on the ultimate control of Stay Online Limited (PVT-RXU2G2KB) between Desire Muhinyuza and Kirimi Koome. The contest is between the legal owner and the beneficial owner,” reads court papers
Gachugi says beneficial ownership is an important concept in many legal contexts, particularly
in the context of corporate law.
BRS says beneficial ownership refers to the natural person(s) who ultimately owns or controls a company, even if that person is not the legal owner of the company.
“From the documents availed and the construction thereof, the plaintiff exercises indirect ownership and indirect control as a beneficial owner as his shares are held through his nominee Koome and he owns a controlling interest in Stay Online Rwanda which in turn own the Stay online Limited Kenyan company,” reads court papers.
BRS says that Desire exercises significant control and influence in Stay online Kenya Limited considering that he exercised decision making power over the management and operations of Stay online limited from it’s incorporation as per resolutions of Stay
online Rwanda dated 1st April 2023, appointment of Koome as a director of the company and the local representative and generally having the ability to influence the strategic direction of stay online limited and also giving instructions that are binding
on the company’s management.
BRS says the concept of beneficial owner is important because it can be used to identify the people who are truly responsible for a company’s actions, even if those people are trying to hide their identities.
Gachugi further notes that this case highlights the evolving landscape of beneficial ownership identification saying Authorities are increasingly scrutinizing legal structures and focusing on control and economic benefits to identify the true owners of assets and income.
“Identifying the beneficial owners of legal persons is crucial in the present circumstances. This involves identifying the natural persons who ultimately own or
control a legal entity, such as a company, trust, or foundation,” reads court papers
He further says that Understanding the concept of beneficial ownership involves having a greater understanding of the Key elements of this new creature
Kirimi Koome following court proceedings
“In determining beneficial ownership from the documents availed to the Registrar
of Companies, Desire has a significant economic interest in the legal entity known as Stay Online Limited and exercises control over its economic benefits, and would be considered a beneficial owner, even if he does not hold the legal title to
the entity’s shares,” reads court papers.
Gachugi says determining beneficial ownership, If an individual has a significant economic interest in the legal entity and exercises control over its economic benefits, they would be considered a beneficial owner, even if they do not hold the legal title to
the entity’s shares.
The case proceeds for hearing tomorrow before Justice Alfred Mabeya and Desire is expected to take the stand and give his evidence on how Koome has attempted to forcefully take the company from him.
Koome has a pending criminal case related to the case where he has been charged with several counts of fraud. The criminal case is scheduled for hearing next year.
