Unmasking Shell Companies Legal experts say a stricter definition of ‘beneficial interest in a share’ under company law and strengthening of the monitoring mechanism of listed entities may help prevent abuse of shell companies Two recent events, though unrelated, could have a wide-ranging impact on the abuse of shell companies for money laundering and tax evasion. The first is a provision in the Companies (Amendment) Bill, 2017, that was recently cleared by the Lok Sabha. It proposes to define, for the first time, the term “beneficial interest in a share”. It further makes it mandatory to maintain a register of persons with a significant beneficial interest in a company. The other event is the Securities and Exchange Board of India (Sebi) setting up a committee on “fair market conduct” to suggest measures to improve surveillance of the markets. “The Companies (Amendment) Bill, 2017, gives an extremely wide and inclusive definition of ‘beneficial interest in a share’ that