InsightsInsight - Commercial Law - POSTED: April 13 2016
Company law changes
Register of People with Significant Control
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As reported in our last edition, from 06 April 2016 certain UK companies (including dormant companies) and Limited Liability Partnerships (“LLPs”) will be required to create and maintain a register of people with significant control or record the required particulars of relevant legal entitles that would hold significant control if they were individuals (“PSC register”).
Companies and LLPs will be required to take reasonable steps to contact its PSCs and confirm the information for the PSC register. If someone refuses to provide the information they will commit a criminal offence.
A company may also approach people who it believes have knowledge of who its PSCs are. A company may elect to maintain the information that must be entered in its PSC register on a central register kept by Companies House.
This alternative method of keeping the PSC register comes into force on 30th June 2016 alongside equivalent provisions relating to registers of members, directors, directors’ residential addresses and secretaries. Although there is no required format for the PSC register, the government does prescribe the information that it must contain.
For both companies and LLPs, official wording for those required entries is set out in Annexes 2 and 4 to the non-statutory Guidance for Companies, Societates Europaeae and Limited Liability Partnerships.
Once the required particulars have been recorded in the PSC register, the company must keep the register up to date and make it available for inspection. Failure to comply with the PSC regime is a criminal offence punishable by a fine and/or imprisonment. Companies may also restrict the rights attaching to the shares in question. Please refer to our guidance note for more detailed advice on the new requirements.
Changes to company registers and filing requirements
On 30th June 2016, the requirement to file an annual return is being replaced by a requirement to deliver a confirmation statement which states that the company has delivered all the information it was required to provide in the period to which the confirmation statement relates.
A confirmation statement must be provided in every 12 month period but the company can choose to provide a confirmation statement at any point prior to its due date. The next 12 month period will run from the date specified in the confirmation statement.
As referred to above, from 30th June 2016, companies will also be given the option of keeping the information that must be recorded in the register of members, register of directors, register of directors’ residential addresses, register of secretaries and the PSC register on the public register maintained at Companies House dispensing with the requirement to maintain the registers separately.
Ban on corporate directors
A ban on the appointment of corporate directors in UK companies is scheduled to come into force in October 2016. The scope of any exceptions to this is yet to be finalised.
For those companies who already have corporate directors, there will be a transition period of one year before they need to be replaced.
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