New reg­is­ter of com­pany con­trollers

The Peterborough Evening Telegraph - - Business -

Changes to UK com­pany law have im­posed new obli­ga­tions on UK com­pa­nies, as well as those hold­ing in­ter­ests in them.

Com­pa­nies are now re­quired to pro­duce a reg­is­ter of ‘per­sons with sig­nif­i­cant con­trol’ – com­monly known as a PSC-reg­is­ter – which con­tains de­tails of the ul­ti­mate ben­e­fi­cial own­ers of the business.

The in­for­ma­tion needs fil­ing with Com­pa­nies House where it is held in a pub­lic reg­is­ter and is de­signed to im­prove the level of trans­parency of UK com­pa­nies.

But what is meant by ‘sig­nif­i­cant con­trol’?

The def­i­ni­tion of a per­son with sig­nif­i­cant con­trol is any per­son to whom one or more of the fol­low­ing points ap­plies:

The in­di­vid­ual ei­ther di­rectly or in­di­rectly holds more than 25 per cent of the shares in a com­pany.

The in­di­vid­ual ei­ther di­rectly or in­di­rectly holds more than 25 per cent of the vot­ing rights in a com­pany.

The in­di­vid­ual has the right to ap­point or re­move a ma­jor­ity of a com­pany's board of direc­tors.

The in­di­vid­ual ex­er­cises, or has the right to ex­er­cise, sig­nif­i­cant in­flu­ence or con­trol over the com­pany.

The in­di­vid­ual ex­er­cises, or has the right to ex­er­cise, sig­nif­i­cant in­flu­ence or con­trol over the ac­tiv­i­ties of a trust or firm which is not a le­gal en­tity, and which it­self meets one of the above con­di­tions.

For more com­pa­nies with pretty sim­ple or straight­for­ward struc­tures, the new re­quire­ments are rel­a­tively pain free, but oth­ers with more com­plex ar­range­ments where is­sue of own­er­ship is un­clear, a sit­u­a­tion may be more chal­leng­ing.

The new leg­is­la­tion de­mands that com­pa­nies are re­quired to take all rea­son­able steps to iden­tify whether a per­son or le­gal en­tity has sig­nif­i­cant con­trol and to in­clude rel­e­vant de­tails re­lat­ing to them in the PSC reg­is­ter.

That means com­pa­nies may have to look be­yond peo­ple who im­me­di­ately own their shares and to iden­tify any­one who has sig­nif­i­cant con­trol of the com­pany. Fail­ure to com­ply with the new rules could po­ten­tially re­sult in fi­nan­cial penal­ties or crim­i­nal con­vic­tion. Other changes to com­pany law in­clude amend­ments to the fil­ing re­quire­ments of com­pa­nies with Com­pa­nies House, which came into force in June. The an­nual re­turn will be re­placed by the new‘ check and con­firm’ process, in which com­pa­nies will sup­ply con­fir­ma­tion that in­for­ma­tion is up to date. Any changes must be filed at least ev­ery 12 months. If you would like to know more about how these changes could af­fect your com­pany, con­tact Rawl­in­sons on 01733 568321. We pro­duce com­pli­ance state­ments for com­pa­nies to en­sure they are meet­ing their le­gal obli­ga­tions.

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