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In a landmark development, the Economic Crime and Corporate Transparency Act received royal assent on October 26, 2023. This act empowers Companies House to play a more active role in combating economic crime and fostering economic growth, setting out a series of transformative measures which aim to enhance transparency and ensure more accurate and reliable information on company registers. In this article, we shed some light on the upcoming changes to help stakeholders navigate what lies ahead.
Companies House is aiming to introduce the first set of changes on 4 March 2024. This exact date remains dependent on parliamentary timetables, but the first set of changes will not come into effect any earlier.
These changes aim to ensure companies, intermediaries and other stakeholders are operating lawfully, whilst contributing to meeting new objectives. Company directors, PSCs, and individuals responsible for filings must stay informed and be ready to take action. Those considering incorporating a new company should also closely monitor developments.
“These are the first steps in the Government’s wider plan to tackle economic crime whilst supporting economic growth. Although most of the changes will be technical in nature, it is important for stakeholders to stay informed and be proactive in order to avoid breaches which may result in penalties for non-compliance.”
Andrew Marks – Associate Partner
Changes from 4 March 2024
Companies must have an “appropriate address” as their registered office, where documents can be expected to come to the attention of a company representative and be recorded by an acknowledgment of delivery.
PO Boxes can no longer be used as registered office addresses. Third-party agent addresses can still be used if they meet the criteria. Companies currently using PO Boxes must change their registered office address by March 4, 2024, and can do so online using their company’s authentication code.
Failure to have an appropriate registered office address may result in being struck off the register, with Companies House changing it to a default address if necessary.
From March 4, 2024, all companies must provide a registered email address to Companies House, which will not be published on the public register.
New companies must provide this email address upon incorporation, while existing companies must do so when filing their next confirmation statement with a statement date from March 5, 2024.
The registered email address will be used for official communication, and companies must maintain it or risk committing an offense.
Subscribers (shareholders) incorporating a company from March 4, 2024, must confirm they’re forming the company for a lawful purpose. Companies must confirm on their confirmation statement that their intended future activities are lawful.
Failure to confirm these statements may result in documents not being accepted, and action may be taken against companies found not to be operating lawfully.
Existing companies must make a lawful purpose statement when filing their next confirmation statement with a statement date from March 5, 2024.
Under the Economic Crime and Corporate Transparency Act, there will be new responsibilities for:
One of the cornerstones of the Act is the imposition of new responsibilities on company directors. Whether you are a new or existing director, the changes brought about by the Act will impact your role. It is essential for directors to stay informed about these changes to fulfil their obligations effectively. Increased transparency and accountability are expected outcomes as a result of these measures.
People with Significant Control (PSCs)
Individuals classified as People with Significant Control (PSCs) will face new responsibilities under the Act. This group includes those who hold substantial influence or control over a company. The Act places a heightened emphasis on the disclosure of accurate information about PSCs, aiming to create a more transparent corporate landscape.
Those filing on behalf of a company
The Act extends its reach to anyone who files on behalf of a company. Whether you’re an accountant, legal professional, or another representative, understanding the changes is crucial. The Act introduces new obligations for those involved in the filing process, emphasising accuracy and compliance with the evolving regulatory framework.
How can we help?
We will provide further guidance as further details of the requirements are published. Should you have any queries, please do get in touch.
For more information on the changes from 4 March, please visit: Get ready for changes to UK company law – Companies House (blog.gov.uk)
For details of the overall changes, please visit: Changes to UK company law – Changes to UK company law
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