WITNESSING an 11 per cent uptick in the number of companies incorporated last year, the Companies Office of Jamaica (COJ) said it is encouraged by the growing list of entrepreneurs who have been moving to secure formality for their businesses.

Data from the entity show that in 2022 some 5,412 new limited liability companies were incorporated, making it a record year for the number of new entrants being added to the Register of Companies in any given year. The number of businesses seeking renewals also increased by more than six per cent above the prior year.

“The increase in the number of renewals is a very positive sign for economic growth,” stated Shellie Leon, interim chief executive officer (CEO) and registrar of companies at the COJ, who also noted that as a result of current data her office is also very pleased with the commitment of entrepreneurs in positioning their businesses for continuity and expansion.

In 2020 approximately 3,935 companies were incorporated, accompanied by 12,809 business registrations. The following year there was an increase of 943 in company formalisations and 4,230 in business registrations, respectively.

However, in 2022 registrations for new sole proprietorship and partnership businesses dipped seven per cent, resulting in only about 15,701 business names being added to the Register of Business Names.

Speaking on the rationale behind the respective registrations, Leon said that the incorporation of a company is usually conditioned by greater obligations when compared to those required for the registration of a business name.

“The pattern in registrations therefore serves as an indicator that entrepreneurs and investors are understanding the diversity in the vehicles and how they can be used to conduct business while limiting liabilities,” she said.

Under the Companies Act, companies are, among other things, mandated to file annual returns, identify beneficial owners, and file notices of changes to officers. The COJ’s primary functions span the registration and regulation of companies and businesses, maintaining accurate and up to date records on commercial entities, and administering the online National Security Interests in Personal Property Registry.

With the Jamaican economy now fully reopened since the onslaught of the novel coronavirus pandemic, Leon further said that “the decline in the registration of business names may be as a result of more persons going back to work as employees rather than creating new businesses for themselves”.