
With over 30 years’ experience heading the Company Secretarial team at Wilder Coe, Ian Saunders, Partner, delves into the current and upcoming legislation changes for the Economic Crime and Corporate Transparency Act and explores what companies must consider to remain compliant with the changing UK laws.
What changed?
The Economic Crime (Transparency and Enforcement) Act 2022 was introduced to meet requirements for registering overseas entities that own UK property to prove their beneficial ownership.
In October 2023, the Economic Crime and Transparency Act 2023 became law in the UK, completely overhauling the government’s framework for tackling financial crime. From March 2024, the act gives Companies House new powers to play a significant role in tackling crime and supporting economic growth, requiring companies to provide better transparency over their directors and beneficial owners.
Registration of Overseas Entities
Any overseas entity that owned UK property had to register by the end of January 2023 or incur daily fines of £1,000 if failing to register. However, as of April 2024, Wilder Coe is still receiving requests to assist overseas entities that failed to register by the original deadline, and we are not aware of any fines imposed.
From April 2024, Companies House can now facilitate the removal of entities that have sold all UK property from the register. Applications take at least two weeks to be processed and no refunds are given if the entity still holds UK property.
The Economic Crime and Transparency Act 2023
What has already been enacted?
Companies House has the power to check the accuracy of any information filed and has increased their fees significantly from 1 May 2024.
All companies must now provide a registered email address and are required to confirm their future activities will be lawful.
What will be brought in?
New requirements to provide additional shareholder information will improve the transparency of ownership and there will be restrictions on using corporate directors. Also, a transition to software-only filing will see changes for small company accounts filing.
Companies House will have greater investigative, data sharing and enforcement powers and will request identity verification for All Directors and Persons of Significant Control (PSC).
Persons of Significant Control will have 14 days after registering a company or becoming a PSC to fill their identity proof at Companies House or via a regulated corporate service provider, such as Wilder Coe. Relevant Legal Entities have 28 days to supply evidence.
Forthcoming changes to consider
- Every company must file a one-off complete list of all shareholders and must record the full name of each shareholder in the Register of Members
- Corporate Directors are only allowed where that corporate has only human directors identified under this legislation
- Any company claiming a PSC details exemption will be asked to supply more information to Companies House
- Companies House will collect and display the conditions that allow a relevant legal entity to be displayed as a PSC
- The anticipated timeline for transitioning to software-only filing accounts is in the next 2-3 years
- Complete adoption is only possible once the developed software allows complex accounts filing
What are our responsibilities as an authorised corporate service provider?
The regulations require us to do five things:
- Ensure that when a facility opens, we register with Companies House
- Ensure all details are presented correctly accurately to Companies House
- We must retain records of all information presented to us
- Whenever necessary, we must deal with Companies House enquiries
- Ensure all staff are trained to provide the correct details to Companies House
Company secretarial support services
These legislative changes can impact your organisation and with no two companies being the same, arrange a call with Ian Saunders for assistance with any complexities. His technical knowledge and insight can help guide you through the changing legislative landscape. for assistance with any complexities. His technical knowledge and insight can help you deliver further support to your clients.