In 2023, the UK government introduced the Economic Crime and Corporate Transparency Act (ECCTA) to enhance the registration and operation of companies to combat economic crime, such as money laundering and fraud. In March 2024, the ECCTA regulations empowered Companies House to improve the accuracy of its registers and impose new responsibilities on company directors, persons with significant control (PSCs) and those filing on behalf of companies.
FURTHER READING: Changes to Company Law – The Introduction of The Economic Crime and Corporate Transparency Act.
Companies House ECCTA Transition Plan
An outline transition plan reforming the role of Companies House in accordance with the ECCTA was released in October 2024. Some of the following updates expected in 2025/2026 include:
Identification Verification for Company Directors and Owners
- Previously, individuals could list themselves as directors or owners of a company without having to provide proof of their identity. However, starting in Spring 2025, all company directors and owners will be required to verify their identity before they can officially register with Companies House. This requirement also applies to anyone acting on behalf of a company.
- In the coming months, Companies House is expected to release more information about how the identity verification process will work. However, from 25 March 2025, individuals will have the option to verify their identity voluntarily.
Improving Transparency of Company Ownership
- Companies are required to record the full names of shareholders in their registers and provide a one-time shareholder list to Companies House, allowing them to display shareholder information in a more user-friendly manner.
- There are also restrictions regarding the use of corporate directors. Only UK corporate entities that have legal personality can be appointed as corporate directors. Furthermore, the director(s) of any corporate director must be a natural person(s) and must verify their identities as specified.
Protecting Your Information
- From 27 January 2025, individuals will have the option to apply to suppress the company’s registered office address when it is also their home address from historical documents.
- Additionally, from spring/summer 2025, individuals will be able to suppress their date of birth for documents registered before 10 October 2015, signatures, and business occupation from historical documents.
Changes to Limited Partnerships (LPs)
- From spring 2026, LPs must adhere to additional requirements including the following:
- Providing the names, dates of birth, and usual residential addresses of all partners;
- Verifying the identity of general partners;
- Having a registered office address in the UK, which must be located in the same country where the LP is registered;
- Including a Standard Industrial Classification (SIC) code; and
- Submitting an annual confirmation statement.
- LPs will need to file the above information through an Authorised Corporate Service Provider (also known as an authorised agent) that’s registered with Companies House. This is to ensure the data is trustworthy and fit for purpose.
- There will also be new powers to:
- Close and restore limited partnerships;
- Apply sanctions;
- Protect partners’ information; and
- Operate a statutory compliance process.
Summary
The ECCTA introduces significant changes to Companies House. Although these changes may require additional steps from business owners, the overall benefits to the regulation of UK companies are clear through the emphasis placed on the transparency and accessibility of UK companies, as well as through attempts to combat financial crime, improve the accuracy of company records, and ensure greater accountability among businesses.
For further information or guidance, contact BHW’s Corporate & Commercial department by emailing info@bhwsolicitors.com or by calling 0116 289 7000.