The new Register of Overseas Entities came into force on 1 August 2022. From this date, any Overseas Entities that own property or land in the UK must be entered onto the Companies House register.
It has been introduced as part of a general shift towards greater transparency and accountability for companies operating in the UK, and forms part of the UK Government’s plans for tackling economic crime.
Through bringing in such measures, the government is trying to ensure that companies are not able to disguise the true nature of their ownership or control for illegitimate reasons, with severe criminal consequences for non-compliance, including a potential daily fine of £2,500 or up to 5 years in prison.
What is an Overseas Entity?
An Overseas Entities is a legal entity, such as a company, that is governed by the laws of a country or territory outside of the UK.
How do Overseas Entities get entered on the register?
The following will need to be provided to Companies House:
- Details relating to the Overseas Entities:
- Name, country it was formed in, registered office address, governing law and registration number.
- Each beneficial owner Overseas Entities and the nature of their control.
- The managing officers and their roles and responsibilities.
- Specifics of any disposals of land that have been made by the Overseas Entities since 28 February 2022, and information relating to the land itself.
- Proof of verification checks, performed by a UK regulated agent, and details of the agent.
- A £100 registration fee.
Once this has been provided to Companies House, if the application is accepted, they will provide the Overseas Entities with a unique Overseas Entity ID that will be required by the Land Registry when dealing with UK property or land.
What about OEs that already own property in the UK?
The requirement to register is a retrospective one, meaning that depending on where in the UK the property is, different dates apply after which point ownership will need to be registered, in time for the deadline of 1 February 2023:
- England and Wales – 1 January 1999
- Scotland – 8 December 2014
- Northern Ireland – 5 September 2022
Additionally, any Overseas Entities that have sold, leased, or had any other dealings with property in the UK after 28 February 2022 will need to inform Companies House of this, along with giving details in relation to the transaction itself and the beneficial ownership of the Overseas Entities at the time.
For any transactions that have taken place since 28 February 2022, the same information will need to be provided on or before 31 January next year.
What happens if an OE fails to register?
If an Overseas Entities that owns property in the UK fails to register, then a restriction will be placed onto the title at Land Registry. This will stop the Overseas Entities from selling, leasing, transferring, buying or charging the property. The Overseas Entities will not be able to be registered as a landowner until they obtain an Overseas Entities ID.
What needs to be done now?
Any Overseas Entities who wish to have any dealings with property in the UK, or who have held property during the retrospective time period, must ensure that they are registered with Companies House as soon as possible.
Overseas Entities must also bear in mind that there will be an annual update required to provide details of beneficial ownership to Companies House.
If you need any further advice or information regarding the new register of Overseas Entities, BHW Solicitors has an experienced Corporate and Commercial team who would be pleased to discuss this with you. Feel free to contact us at firstname.lastname@example.org.