Regulatory changes to company law will be introduced on 4th March this year so UK businesses need to be fully prepared.
The Economic Crime and Corporate Transparency Act (ECCTA), which received royal assent in October last year, will introduce significant changes to company law on 4th March. The new legislation aims to deliver reforms on tackling economic crime, improve transparency over corporate entities, and provide more accurate and trusted information on Companies House registers.
The changes mean there will be new responsibilities for all new and existing company directors, people with significant control of a company (PSCs), and anyone who files on behalf of a company.
We have summarised the new legislation so you can see what is changing and ensure you are fully prepared.
New powers to remove or reject companies
Companies House will have the authority to scrutinise information submitted to improve the accuracy of its registers and remove organisations suspected of fraudulent activities. It will also now share data with other government departments and law enforcement agencies.
UK businesses will need to:
- ensure their registered office has a proper address that is not a PO box
- provide a registered email address
- confirm they are forming the company for a lawful purpose on incorporation and also in their confirmation statement each year
- ensure their company name is not giving a false or misleading impression to the public.
Identity verification
Companies House has also stated that it will soon introduce a new identity verification process to help deter those wishing to use companies for illegal purposes. Anyone setting up, running, owning, or controlling a company in the UK will eventually need to verify their identity directly through Companies House or through an authorised agent to prove they are who they claim to be.
- New companies: all directors and PSCs will need to complete identity verification
- Existing companies: all directors (or equivalent) and PSCs will have a transition period to verify their identity.
Innovus Company Secretary Manager Geeta Sesodia says: ‘We welcome the new legislation. In line with the new requirements, we will ensure the required checks and measures are in place for all appointments and incorporation of new companies. Our clients can be confident that, for us, their security safety and peace of mind is paramount.‘
There will be serious consequences for companies which do not comply with the new legislation. We are here to help you navigate the changes and/or register your company on your behalf.
