February 06, 2024

Changes to UK Company Law

Companies House

cogs turning

 

The Economic Crime and Corporate Transparency Act,(“The Act”) granted royal assent on 26 October 2023, heralds a transformative era for Companies House, marking the most significant overhaul since the institution's inception in 1844. These measures will gradually foster enhanced transparency, culminating in more accurate and trustworthy information within the UK's registers. This, in turn, aims to bolster confidence in the nation's economy, unlocking greater value for businesses and citizens, both domestically and internationally.

Key provisions include:

  • Mandated identity verification for all new and existing registered company directors, individuals with significant control (PSCs), and those filing on behalf of companies.
  • Expanded powers to actively monitor company creation, ensuring more reliable data.
  • Modernised financial reporting standards aligned with digital advancements, facilitating more informed business decisions.
  • Enhanced enforcement capabilities for Companies House, coupled with improved information sharing with relevant partners.
  • Strengthened personal data protection safeguards to mitigate risks of fraud and other forms of harm to individuals.

This Act builds upon the Economic Crime (Transparency and Enforcement) Act of August 2022, which established the Register of Overseas Entities. Collectively, these initiatives represent a substantial stride towards curbing economic crime and promoting greater corporate transparency.

Under The Act, there will be new responsibilities for: 

  • all new and existing company directors
  • people with significant control of a company (PSCs)
  • anyone who files on behalf of a company.


Company types and other corporate entities

The new legislation would apply to all entities registered with Companies House, including: 

  • private limited companies
  • public limited companies (PLCs)
  • limited liability partnerships (LLPs)
  • limited partnerships (LPs)
  • community interest companies (CICs)
  • overseas companies

The legislation applies to companies and other entities registered in England and Wales, Scotland, and Northern Ireland.

Authorised agents 

The Act extends beyond company directors and individuals with significant control. Those acting on their behalf, such as accountants and company formation agents, must also adhere to its requirements. They will need to register as Authorised Corporate Service Providers (ACSPs) with Companies House, effectively becoming trusted intermediaries in the registration process.

Confirmation Statement Changes: Key Updates

Filing Frequency: All companies, including dormant and non-trading entities, must file a confirmation statement at least once annually. This document verifies the accuracy of Companies House records, regardless of changes during the review period.

Effective Date: The revised confirmation statement is anticipated to be launched on 4 March 2024. However, this date depends on parliamentary approval and thus will not be earlier than 4 March 2024.

Registered Email Address

All companies will need to provide a registered email address for official communication from Companies House. Please note this information will not be publicly accessible.

New Companies: Effective 4 March 2024, new companies must include a registered email address at the time of incorporation.

Existing Companies: Starting with confirmation statements dated 5 March 2024 and onwards, existing companies must provide a registered email address.

Lawful Activities Confirmation: All companies must now confirm that their intended future activities are lawful. The confirmation statement cannot be filed without this declaration. This requirement applies to all confirmation statements dated 4 March 2024 and onwards.

Many of the Act's provisions will necessitate supplementary legislation and Companies House guidelines, as well as the creation of Companies House infrastructure to effectuate the changes. As a result, many of these measures are expected to take at least a year to become effective.

Please note: This information is subject to parliamentary approval and may be adjusted based on legislative proceedings. Further updates will be provided as they become available from the Registry.

If you have any queries relating to this brief, please contact us at info@fid.gi  for further guidance and assistance.