Draft regulations have been published to amend the law regarding the registration of security at Companies House (which is contained in Part 25 of the Companies Act 2006). The changes are set out in the Companies Act 2006 (Amendment of Part 25) Regulations 2012 and the Limited Liability Partnerships (Application of Companies Act 2006) (Amendment) Regulations 2012. These regulations seek to modernise and simplify the registration process. They are expected to come into force on 6 April 2013. In summary, the main provisions of the regulations are the following:
- Introducing a single UK-wide system of registration of security.
- Introducing electronic filing to simplify the security registration process, including allowing for the filing of a certified copy of the security instrument.
- Removing criminal sanctions for non-registration of a registrable security. However an unregistered security may still be invalid against a liquidator, administrator or creditor of the security provider.
- Increasing transparency and the quality of information in the public domain by creating a regime in which the full text of the charge instrument or security document is available on the register at Companies House.
- Clarifying the notification process for the satisfaction and release of security.
- Clarifying the information required when notifying Companies House of matters relating to the enforcement of security.
- Providing for all charges to be registered, other than those listed in draft regulations.
- Clarifying when the 21-day registration period starts to run for each type of security.
- Providing that, even though registration is optional, the fact that a negative pledge has been registered should give rise to constructive notice.