The UK is to set to reform its register of company information in an effort to combat fraud and money laundering. Under the proposed new measures, Companies House will also be granted powers to query and reject information with the aim of improving the quality of data on the register. This drive towards greater transparency will be balanced by changes designed to ensure that the personal data of users on the register is sufficiently protected. The proposed reforms fall into four separate categories:
Knowing who is setting up, managing and controlling corporate entities
Compulsory identity verification will be introduced for all directors and People with Significant Control of UK registered companies as well as all individuals who file information on behalf of a company. Companies House will continue to allow company incorporations and filings to be made either directly or through an agent. Agents will however need to be covered by appropriate UK anti-money laundering regulations and have a verified account at Companies House.
Improving the accuracy and usability of data on the companies register
Companies House will be able to query and check information that is submitted to it before it is placed on the register, and will have wider powers to amend information that is already on the register.
There will be reforms to the filing of company accounts. Whilst the details of these changes are yet to be finalised, it is envisaged that the reforms will include the introduction of full iXBRL tagging for the submission of accounts to Companies House.
Protecting personal information
Directors will no longer be required to detail their occupation on the register and a process will be set up for individuals to suppress this information (along with signatures, the day of date of birth and residential addresses) where it is currently displayed on the register.
Ensuring compliance, sharing intelligence, other measures to deter abuse of corporate entities
The obligations on certain entities to report to Companies House discrepancies between the information held on the public register and the information that they hold will be extended. In a similar vein, the proposals set out a framework for the cross-referencing of Companies House data with data held by other bodies.
Companies House will be given discretion to query, and possibly reject, company names before registration whilst it is also envisaged that the process under which certificates of good standing are issued by Companies House will be reformed.
In addition, a process will also be introduced under which limited partnerships can be struck off the register following a court order.
The proposed measures represent a significant reform of the UK's company registration framework. The Government intends to seek further input on certain issues, such as accounts reforms, and will publish comprehensive details of how the proposed reforms will be implemented.
Written by Mark Devlin
We are committed to making the UK the best place in the world to start and grow a business. The reforms we are making to the Companies House register will provide businesses with greater confidence in their transactions.