BIS has published a discussion paper seeking views on enhancing transparency of beneficial ownership information of foreign companies that buy land or property in England and Wales or enter into public procurement contracts in England. The government is considering whether foreign companies that wish to buy land or property in England and Wales should be under a similar obligation as UK companies to maintain a PSC Register.

From 6 April 2016, UK companies will be required to keep their own register of people with significant control (PSC), which will contain information on the company’s beneficial ownership and control (PSC Register). From 30 June 2016, this information will need to be supplied to Companies House alongside the annual confirmation statement of a company’s records. Thus, by June 2017, Companies House will hold PSC information for most UK incorporated companies, which will be available in a public register. The PSC Register has been discussed in previous Equity Issues.

The discussion paper is asking for views on the extent of beneficial ownership information to be provided by foreign companies and how it should be held. BIS proposes that one option could be to establish a further register managed by Companies House alongside the PSC Register. The paper is also seeking views on how any new requirements should be enforced and suggests it may be appropriate to have alternative or additional methods of enforcement to cover situations where foreign companies provide false beneficial information to the register or fail to keep it up to date. Possible additional civil and criminal sanctions could include imposing a daily fine and/or sanctions linked to the specific activity the foreign company needs to register for.

The government is considering exempting foreign companies incorporated in jurisdictions which already have an accessible central register of beneficial ownership information from providing similar information to a UK foreign company beneficial ownership register. This would avoid duplication with the requirements of Article 30 of the Fourth Money Laundering Directive (MLD4), which requires Member States to ensure entities hold adequate, accurate and current beneficial ownership information in a central registry.

The remainder of the discussion paper seeks views on the proposals for obtaining information on the beneficial owners of a foreign company wishing to bid on a contract with the UK government and identifies four possible options to ensure the contracting authority obtains beneficial ownership information from the bidder companies before awarding a public contract.

The closing date for responses is 1 April 2016.