The new requirements coming into force at Companies House.
With the Economic Crime and Corporate Transparency Bill (ECCT) set to receive Royal Assent in Q4 2023, Companies registered in the UK are advised to prepare for a host of new requirements, amounting to the biggest upgrade to Companies House since its formation.
The Bill is the latest measure in the fight against economic crime and the push for corporate transparency. Key changes will include a greatly improved and empowered Registrar of Companies, with the objective of it becoming the custodian of more reliable data. Rather than its current form in which data can often be wildly inaccurate or out of date, Companies House 2.0 will be an active gatekeeper, removing and annotating where it believes data is unverified or inaccurate.
Starting with the basics, all Company directors and PSCs will be required to have their ID verified at Companies House. For new Companies, this will mean that identity verification will become part of the incorporation process. For existing Companies, Directors and PSCs will have to verify their ID within a set period, to be defined in secondary legislation. Any person or entity acting on behalf of Companies will also need to have their ID verified or will not be able to make any filings.
There are 2 routes to choose from when verifying ID. Firstly, individuals will be able to verify directly with Companies House, potentially through a digital service which will link a person to their primary identity document through the use of biometric security applications. Secondly, Companies may use an Authorised Corporate Service Provider (ACSP), which must be registered with a supervisory body for anti-money laundering purposes and must have an existing duty to carry out due diligence on their clients. ACSPs, which shall include law and accountancy firms, must register with Companies House and must confirm the verification of ID prior to making any filings.
In a move likely to ruffle some feathers, Companies House will annotate the Register of Companies to highlight Directors and PSCs who remain unverified.
Herrington Carmichael LLP would be pleased to host consultations with Individuals and Companies concerned about the heightened Company Secretarial requirements as required by the Bill. Please contact us to speak to a member of our Corporate Team.
