On 26 October 2023, the Economic Crime and Corporate Transparency Bill received Royal Assent, paving the way for fundamental reforms to the registration and administration of companies with the aim of tackling economic crime more effectively.
Every UK corporate entity will be affected when the new laws are brought into effect. One significant change will be the introduction of an identity verification regime for new and existing directors, LLP members and people with significant control.
The new law will also extend the scope of corporate criminal liability and large organisations will be subject to a new offence of failure to prevent fraudulent activity by employees or agents. Companies may also be held liable where senior managers commit certain economic crimes.
The changes will demand significant development and upgrades to Companies House systems and procedures. In a new Blog Post the registrar of companies says that she expects a number of changes will come into force in early 2024, including:
- greater powers to query information, and to scrutinise and reject information that seems incorrect or inconsistent with information already on the register. In some cases, information may be removed;
- stronger checks on company names;
- new rules for registered office addresses which will mean all companies must have an appropriate address at all times. Companies will not be able to use a PO Box as their registered office address.
- a requirement for all companies to supply a registered email address;
- a requirement for all companies to confirm they are forming the company for a lawful purpose when they incorporate. Every year, the company will need to confirm that its future activities will be lawful on their confirmation statement;
- annotations on the register to let users know about potential issues with the information that is been supplied to the register;
- taking steps to clean up the register, using data matching to identify and remove inaccurate information;
- sharing data with other government departments and law enforcement agencies.
You can find some additional information here.
We will keep you informed as the new provisions come into effect.
For further information, please contact:
Meriel Schindler, Partner, Withersworldwide
meriel.schindler@withersworldwide.com
