The UK Government has committed to greater transparency of company ownership and control in its drive for the country to be recognised as an open and trusted forum for business and to deter the use of companies to facilitate the conduct of illicit activities.
The Government introduced primary legislation to the Parliament in June 2014, which prescribed the introduction of a publicly accessible ‘register of people with significant control’ over a company (PSC Register) and excluding certain data from the information available to the public. From 6 April 2016 enterprises must start keeping a record of the people that control their company – the people with significant control (PSC). Failure to do so can attract criminal penalties.
PSCs normally are shareholders
For most companies PSCs are individuals that directly or indirectly hold more than 25% of the company’s shares, directly or indirectly control more than 25% of the company’s voting rights, or have a direct or indirect right to appoint or remove a majority of the board of company directors.
Information to register
The registrable PSC information shall be the individual’s name, service address, the country or state in which the individual is usually resident, nationality, date of birth, usual residential address, the date on which the individual became a registrable person in relation to the company in question, and the nature of his or her control over that company.
Information to be provided before incorporation
Importantly, this information must be provided to the Registrar before a company can be incorporated, thereafter it must be reviewed at least annually and updated where necessary. There will be two PSC registers – one held by the company and the public register by the Registrar of Companies, but a private company can choose to hold their PSC register solely on the public register.
Annual return replaced by confirmation statement
Details of PSCs must be provided to Companies House from 30 June 2016. Normally this will be done as part of the first confirmation statement that will replace the annual return from 30 June, however if there are no PSCs or they are still being confirmed, there will be a selection of statements to choose from.
The confirmation statement replacing the annual return from 30 June means that at least once every year the company must review the information Companies House holds about it and confirm that it is correct or it is being updated at the time of making the statement. This will be possible to complete online.
The following is necessary to complete the confirmation statement:
- the information held about registered office, directors and location of registers must be checked; if any of these require changing they must be updated by filing the correct form;
- the shareholder information, statement of capital and standard industry classification (SIC codes) must be updated; this can be done as part of making the confirmation statement;
- the company must check and confirm its record is up to date;
- a fee of £13 must be paid.
Updates can be submitted for free
The first confirmation statement also requires providing the information contained in the company’s register of people with significant control. If the company’s information changes at a later date a confirmation statement to update the record and confirm it is correct can be made then. This can be done as many times as is necessary and the company will only be charged once each year.
Additional guidance is available on the website of Companies House.
