Pension trustee companies should be aware that from 6 April 2016 there will be a new requirement to keep a register of your “persons with significant control” (PSC). In addition, from 30 June 2016 this information will need to be delivered to Companies House where it will be made publicly available. Key details about the new requirements and what constitutes a PSC are set out in this newsletter from our Corporate colleagues.
As Trustee directors you should make sure that whoever handles your statutory books and filings is aware of the new requirements and puts procedures in place to ensure they are complied with. It is worth noting that failure to maintain a PSC register will be a criminal offence.
Some of the key points from a pensions perspective are:
- If you have a trustee company limited by shares, your PSC is likely to be your immediate parent company (typically a scheme employer or related company). If you have a trustee company limited by guarantee, it may be more tricky to identify your PSC as there is no “shareholding” as such. In either case, the company’s constitution should be analysed to understand who has control of the company in practice.
- If you have a trustee company whose PSC is a scheme employer or related company, you may view the new requirements as simply a matter of compliance and of no concern. Alternatively, you may be uncomfortable stating publicly that you are “controlled” by the employer’s group as this seems at odds with the fiduciary nature of a pension trustee. In these cases, it may be possible to move to alternative structures such as a company limited by guarantee where the trustee directors are the members (although this would need to be structured carefully to avoid the employer still being regarded as a PSC).
- The requirement to identify PSCs also applies to UK LLPs. Many products that pension plans invest in are LLPs. Where these LLPs are UK based, trustees (whether incorporated or not) may wish to build in a further enquiry into their due diligence process of whether: (a) the LLP has identified its PSC (as they will not want to invest in an entity with a criminal record); and (b) who that PSC is (to ensure there are no surprises).
- Trustees considering potential moral hazard proceedings via the Pensions Regulator may find it easier to identify potential targets for regulatory action as companies within the employer’s group will each have to identify their own PSC.