In August, the Department for Business, Innovation and Skills (BIS) issued its latest proposals on amendments to the provisions governing registration of company charges under the Companies Act 2006. The deadline for comments is 30 September 2011.
The main objective is to provide a single UK-wide charge registration regime that applies to all UK companies (including Scottish companies) and limited liability partnerships regardless of the location of the charged asset or the law used to create the security.
Key points in the latest proposals are:
- the charge registration regimes for English and Scottish companies are being merged so that there will be a single UK-wide regime
- all charges must be registered unless specifically excepted eg rent deposit deeds
- electronic filing will be introduced with filers needing first to obtain a unique authentication code which must be used whenever that filer is registering security; paper filing will also continue to be possible
- in order to file electronically, the filer will email a Statement of Particulars of the security together with a certified copy of the charge instrument (not the original) to Companies House. Personal or commercially sensitive information can be redacted from the certified copy
- persons who may register a charge will expressly include the chargee
- the 21 day time limit for registration will be retained
- the criminal consequences of failing to register a registrable charge will be abolished; the consequence of invalidity will be retained
- where existing security is amended to secure further assets or to increase the amount secured, this will be treated as a further charge and will therefore be registrable
- the registrar’s certificate of registration will be conclusive evidence of the identity of the chargor and that the charge was filed in time, but will no longer be conclusive evidence of the brief particulars filed
- there will be new safeguards to protect against fraudulent filing of statements of satisfaction and release, and the chargee will be able to file release statements.
BIS is also considering whether the registration requirements should apply to unregistered companies and mutuals.
BIS plans to issue draft regulations early in 2012 with the new regime expected to come into force on 1 October 2012.
Finally, of more immediate importance, is that overseas companies will no longer be required to register charges created on or after 1 October 2011 at Companies House (pursuant to The Overseas Companies (Registration of Charges and Execution of Documents) (Amendment) Regulations 2011). Registered overseas companies will, however, be required to keep a register of any charges they create which affect land in the UK, ships, aircraft or intellectual property registered in the UK and any floating charge on the company’s property or undertaking situated in the UK. The register and copies of the charge instruments must be kept at the company’s place of business in the UK and be available for inspection.