From 6th April 2016, most UK companies will be required to hold, and keep available for inspection, a register of people with significant control over the company (PSC register). There are certain actions that companies need to take to ensure that they are prepared.
The basic obligation is to identify and disclose any individuals/companies that have significant control over a company. In group situations, this would usually be satisfied by the subsidiary company noting in its PSC register the immediate parent company as the registrable relevant legal entity (RLE), however there are five separate conditions that could be satisfied and not all situations will be straight forward.
A "person with significant control" (PSC) is an individual who meets one or more of the following conditions:
- Direct or indirect ownership of more than 25% of a company's shares.
- Direct or indirect control of more than 25% of a company’s voting rights.
- Direct or indirect right to appoint or remove a majority of the board of company directors.
- Exercises or has the right to exercise significant influence or control over a company.
- Exercises or has the right to exercise significant influence or control over activities of a trust or firm which itself meets one or more of the first four conditions.
A company must at all times take reasonable steps to keep its PSC register up to date and the register must never be empty. Where it has not established the identity, or confirmed the identity, of a PSC then it must include a prescribed statement to that effect in its register.
As long as the company is undertaking reasonable steps to identify PSCs or RLEs and has made an appropriate entry in their PSC register, they will be compliant with the regulations.
How will this information be made public?
There are two methods of public access. The first is inspection of the register as held by the company or their agent. The second will be to obtain information from Companies House. Access through Companies House will be collected via the Annual Confirmation Statements, which must be filed with effect from 30 June 2016.
The companies subject to the new requirements will be required to maintain the PSC Register from April 2016 and from June 2016 the registers should be filed at Companies House.
A full PSC regime summary guide is attached.