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Reducing bureaucracy and increasing transparency in the ownership and control of UK companies

We reported earlier this year that the Small Business, Enterprise and Employment Act 2015 received Royal Assent on 26 March 2015.  

The key objectives of this legislative change are:

  • Increasing transparency in the ownership and control of companies to tackle tax evasion, money laundering and terrorist activity.
  • Improving the investment climate in the UK by simplifying and reducing the cost of UK company law compliance.

Companies House has now updated the implementation plan for these changes, postponing the dates the new rules will come into force. We set out a summary of the new plan below.

Abolition of corporate directors

The abolition of corporate directors is going to be deferred for a year until October 2016. From this date, all company directors will have to be natural persons (subject to some limited exceptions).

People with significant control

A UK company's new obligation to keep a public register of people with significant control (PSC) will be pushed back from January 2016 to April 2016. The obligation to start filing PSC information at Companies House is deferred from April 2016 to 30 June 2016

In brief, PSCs are direct and indirect owners (as single person or part of a number of joint persons) of a company with more than 25% of shares or voting rights. 

The register, containing PSCs information similar to the information kept about directors in a company's register of directors, has to be open in future for the public directly or via an identical version at Companies House.

Simplified filing requirements

Instead of filing an annual return, companies will be required to deliver a confirmation statement stating that all necessary information regarding the relevant statement period has been delivered at Companies House. Companies will also have the option to record information that was recorded in their statutory registers (members, directors, directors' residential addresses and secretaries) instead on a central register at Companies House.

These changes were originally intended to come into force in April 2016 and will now be pushed back to June 2016.

Disqualification of directors: overseas companies

The changes enabling the disqualification of a director on the grounds that he has been convicted of an offence overseas in connection with the promotion, formation, management, liquidation or striking off of a company or the receivership of a company's property or a person being an administrative receiver are expected to be deferred from April 2016 to June 2016.

For more information on how the changes will affect you please contact Alice Gardner, partner in TLT's Corporate team on +44 (0)333 006 0341 or alice.gardner@TLTsolicitors.com.

This publication is intended for general guidance and represents our understanding of the relevant law and practice as at September 2015. Specific advice should be sought for specific cases. For more information see our terms & conditions on www.TLTsolicitors.com

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