Changes to the PSC regime were rushed through on 26 June in order to meet the deadline imposed by the EU's 4th Money Laundering Directive.
We wrote about the proposed changes in our update on 25 May. The expected changes are now largely in force, or require immediate action in order to comply with forthcoming deadlines. Under the revised regime:
- Companies (whether limited by shares, limited by guarantee or unlimited), LLPs and Societates Europaeae (SEs) still have to keep PSC registers and file PSC information at Companies House, but the information is no longer required in the confirmation statement.
- PSC information must now be filed at Companies House using separate forms (PSC01 to PSC09). We are finding that the forms are reasonably easy to deal with.
- Time is now tight: PSC registers must be updated within 14 days of receipt of information about a change, and notified to Companies House within a further 14 days. Failure to meet these deadlines means potential criminal liability for the company and its officers.
- Companies and LLPs must be far more aware of what is happening in their ownership structures and must act rapidly whenever there are changes. Companies and LLPs will need to put in place a system of regular reminders so the structures are reviewed regularly, and whenever changes happen within a group.
- Unregistered companies and AIM companies (and UK companies listed on other secondary exchanges) will have to keep PSC registers and file PSC information at Companies House from 24 July. To read more on the impact on AIM companies, see our article here.
- From 24 July Scottish general partnerships (SPs) (if all the partners are corporate bodies) and Scottish limited partnerships (SLPs) will be required to file PSC information at Companies House. PSC information will be required in order to register a new SLP.
- It is important to review group structures which contain SPs or SLPs to make sure the 24 July changes do not affect the group's current PSC registers. Previously, these entities would not have qualified as registrable relevant legal entities in existing PSC registers. Again, a system of regular reminders will need to be put in place so the structures are reviewed regularly, and whenever changes happen.
- There are changes to the protection regime afforded to PSCs who are at risk of harm from public disclosure of their information.
- People and entities who think they might be registrable still have a duty to inform companies, LLPs, and so on, and to respond to requests for information from such entities trying to update their PSC registers. Failure to do so still risks criminal liability with potentially unlimited fines and imprisonment.
- Entities will have to be much more aware of changes to group structures, and to the more mundane, less visible changes, such as changes to the addresses of people and entities that feature on PSC registers. All changes must be notified on the new Companies House forms. Regular communication with your legal or company secretarial teams will be essential to minimise the risk of criminal penalties.
- Shorter deadlines mean entities will have to act fast to ensure compliance.
- We fully expect Companies House to be contacting those entities whose public records continue to show the statement that they are 'taking reasonable steps', to demand that companies make a statement about their persons with significant control. It will also be following up on information which is obviously wrong, such as PSC registers which contain details of unlisted foreign entities. Although Companies House cannot carry out this exercise overnight, there is a clear drive to make the public PSC register accurate and complete.
Relevant law: The Information about People with Significant Control (Amendment) Regulations 2017.