The Economic Crime and Corporate Transparency Act 2023 brings about some of the most significant changes to Companies House since it was established, giving it the tools to play an expanded role in tackling economic crime. 

The reforms introduced by the Act are being introduced in stages. Probably the biggest change being introduced is identity verification for all directors, people with significant control (PSCs) and those who file on behalf of companies. Companies House has recently published its outline transition plan on the Act and this gives the best indication to date of when identity verification is likely to come into effect.

Timescales in the plan are subject to review and are dependent on parliamentary time (implementation will require secondary legislation).

Indicative timescales set out in the plan are:

By spring 2025 Companies House should be able to:

• carry out checks on Authorised Corporate Service Providers (ACSPs). ACSPs will be professional intermediaries who must be supervised within the UK by one of the relevant anti-money laundering supervisory bodies. ACSPs may carry out filings on behalf of companies, or in some cases, carry out identity verification services;
• allow individuals to voluntarily verify their identity.

By autumn 2025 Companies House should be able to:

• make identity verification a compulsory part of incorporation and new appointments for new directors and PSCs;
• as part of the annual confirmation statement filing by companies, begin the 12-month transition phase to verify the identity of existing directors and PSCs registered at Companies House (apparently there are more than 7 million). 

By spring 2026 Companies House should be able to:

• make identity verification of those filing documents compulsory;
• require third party agents filing on behalf of companies to be registered as an ACSP.

By the end of 2026 Companies House should be able to complete the transition period for identity verification and start compliance activity against individuals who have failed to verify their identity.

The outline transition plan also summarises:

• Changes already in place, such as the significantly enhanced powers of Companies House since 4 March 2024 to improve the reliability and accuracy of information on the register (see my earlier post on this).
• Further changes relating to Companies House enforcement, investigative and data sharing powers.
• Other related changes yet to be implemented, including the plans for accounts reform and restrictions on corporate directors – no indications of timescales are given for these. 

Companies House has a dedicated webpage giving a useful overview of the upcoming changes, Changes to UK company law.

We will keep you posted on implementation of the Act over the coming months.