Introduction
The United Kingdom, known for its open economy that attracts global business, offers vast opportunities for business leaders. However, this openness also presents risks, such as potential for economic crimes like money laundering and serious fraud. To combat these issues, the UK government has enacted the Economic Crime and Corporate Transparency Act (ECCT Act), aimed at enhancing the integrity of business operations within the country.
Key Provisions of the ECCT Act
- Reforms at Companies House to ensure more stringent verification processes.
- Measures to prevent the misuse of limited partnerships.
- Enhanced powers for seizing and recovering criminal assets, including cryptoassets.
- Provisions to enable businesses to share information more confidently to combat money laundering and other crimes.
- New intelligence gathering powers for law enforcement and streamlining regulatory processes to ease business operations.
Although the act has been officially passed, its full implementation will phase in gradually, starting from early 2024.
Impact on Companies House Operations
Significant reforms under the ECCT Act will transform how Companies House operates, introducing mandatory identity verification for directors, Persons of Significant Control (PSCs), and those filing records. These changes aim to bolster the transparency and reliability of company records.
In addition, Companies House will adopt more robust procedures for scrutinizing financial information and enhancing the quality of data on the register. These measures will help in identifying and removing outdated or inaccurate information and ensuring compliance with legal standards.
What Businesses Need to Do
From March 4, 2024, all companies must provide a registered email address to Companies House, which will be used for official communications but will not appear on the public register. Companies incorporated before this date must submit their email address at their next confirmation statement.
Companies House is also increasing its filing fees effective May 1, 2024, to cover the costs of these enhanced services. Business owners should prepare for these changes by ensuring all their company information is current and planning for the financial impact of increased fees.
Please note: This blog serves as a general guide on upcoming changes at Companies House and is not a substitute for professional legal advice.
