Prepare for director and shareholder identity verification.

Companies House has now provided some indication of its timeframe for implementing further parts of the Economic Crime and Corporate Transparency Act 2023 (ECCTA) Economic Crime and Corporate Transparency Act: outline transition plan for Companies House – GOV.UK .

ECCTA heralded the “biggest changes to Companies House since its establishment in 1844”, including bolstering the role and enforcement powers of Companies House and increasing transparency in ownership and control of UK companies through the requirement for directors and certain shareholders to have their identities verified.

Some of the changes were introduced from the outset, but others are being brought in over the course of the next few years because they will require more fundamental changes, not least in the systems and operation of Companies House.

What provisions have already been implemented in relation to Companies House?

• Increased powers – Since 4 March 2024, Companies House has increased powers to analyse and share data with law enforcement agencies and other government departments. It has begun the process of cleaning information on the existing registers and querying new information that is submitted to them.  From May 2024 it has had the ability to impose fines for offences under company law such as late filing of confirmation statements, ranging from £250 to £2,000 depending on seriousness.
• Registered office address – Since 4 March 2024, all companies have been required to have a registered office address at an “appropriate address”. This is an address where any documents sent to the registered office should be expected to come to the attention of a person acting on behalf of the company, and any documents sent to that address can be recorded by an acknowledgement of delivery. Companies will no longer be able to use a PO Box as their registered office address.
• Registered email address – Since 4 March 2024, companies must provide Companies House with a registered email address. New companies will give the email address when they incorporate; existing companies will need to provide it with their next annual confirmation statement. The email address is not publicly available, but will be used by Companies House to communicate with the company.
• Statement of lawful purpose – Since 4 March 2024, upon incorporation of a company, the subscribers (shareholders) must confirm they’re forming the company for a lawful purpose. Existing companies must confirm their intended future activities are lawful on their annual confirmation statement.
• Changes to Companies House fees – Since 1 May 2024, Companies House has been charging higher incorporation and annual filing fees.

See further detail on these measures at New measures from the Economic Crime and Corporate Transparency Act introduced on 4 March 2024 | Cripps

What is still to come?

• Identity verification (IDV) – by Spring 2025, individuals will be able to complete voluntary identity verification (this will be for new and existing company directors, members of LLPs and persons of significant control (PSCs)). By Autumn 2025, verification will be compulsory on incorporation for new directors and new PSCs, and Companies House will begin a 12-month transition period to require this for existing directors and PSCs.

Individuals will have the ability to verify themselves via a new system to be provided by Companies House (although this is still under development).  Alternatively, individuals can use an Authorised Corporate Service Provider (see below) .

• Authorised Corporate Service Provider (ACSP) – by Spring 2025, in order for any third-party to make filings on behalf of a company and carry out identity verification checks for their clients, they will need to register as an Authorised Corporate Service Provider.
• Protection information – from Summer 2025, individuals will be able to apply to suppress information from historical documents at Companies House such as their residential address, date of birth, signatures and business occupation. Individuals at personal risk of physical harm as a result of their personal information being on a Companies House public register will be able to apply to have their information protected from public view.
• Other provisions – ECCTA provided for a number of other changes but we currently have no timeline for implementation for these, including:
• Abolition of the requirement to maintain certain company registers – a company will no longer need to keep its own register of directors, register of directors’ residential addresses, register of secretaries, or PSC register.   Updating the record at Companies House will be sufficient.
• One-off membership information – existing companies will be required to provide a one-off shareholder information statement with their next annual confirmation statement confirming the full name of each shareholder along with the number and class of shares they hold.
• Restrictions on corporate directors – whilst not completely banned, the use of corporate directors will be restricted so that the board of the company which is acting as a corporate director must not itself have a corporate director on its board (its board must be all natural persons).  Additionally, overseas companies will no longer be able to act as corporate directors of UK companies.

Further details of the changes and what companies need to do and by when can be found here: Changes to UK company law website

You can also receive updates by subscribing to the Companies House newsletter.

How we can help

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