Almost all UK registered companies and LLPs have been required to prepare and maintain a register of people with significant control since April 2016.
The Persons with Significant Control Register – commonly known as the PSC Register - includes details of who ultimately controls or exercises significant influence over the company. Just short of a year following the introduction of this regime significant changes have come into force which aim to target anti-money laundering and terrorist financing throughout Europe.
From April 2016, almost all UK registered companies and LLPs have been required to prepare and maintain a register of people with significant control. Commonly known as the PSC register, this includes details of who ultimately controls or exercises significant influence over the company.
From 30 June 2016, every company and LLP has been required to submit their PSC details to Companies House in the form of a confirmation statement (which replaced the Annual Return). The confirmation statement has been the means by which new PSCs, changes to existing PSCs and someone ceasing to be a PSC have notified Companies House.
The overall aim of the Fourth Money Laundering Directive (4MLD) is to target money laundering and terrorist financing throughout Europe.
The 4MLD requires the central register to be “adequate, accurate and current”. With entities only required to update their PSC details once per year via a confirmation statement, this requirement will be seldom met. The changes to the regime represent the UK government’s push to meet its obligations under the 4MLD.
Changes to the reporting of PSCs
From 26th June 2017, companies will need to notify Companies House of any changes to the PSC register as and when they happen. Changes must be submitted to Companies House within 28 days from the date of change and by using forms PSC01 to PSC09 (or the equivalent forms for LLPs). Failure to do so will result in a £500 fine for the entity.
A confirmation statement will still have to be filed each year, however they can no longer be used to update the PSC position. This also means that any entity which has yet to file its first confirmation statement, must first provide Companies House with its PSC details before filing the statement. It must do so within 28 days of 26th June.
Companies will also need to report various general statements as they become or cease to be true. These are mostly relevant while the company is in the process of identifying and obtaining details of PSCs, or where there is good reason to believe there are no PSCs within the company.
Other corporate entities
The scope of the PSC regime has also been extended to cover all Scottish Limited Partnerships (“SLP”) and also General Scottish Partnerships (“GSP”) where all the partners are corporate bodies. From 24th July 2017, these entities will have 14 days to notify Companies House of their PSCs and will confirm this information by an annual confirmation statement.
Protection of PSC information
Under the regime, PSCs can apply to Companies House to have certain personal information protected from disclosure. This protection regime will now apply to SLPs and GSPs. Only specified public authorities can access this information at the moment for company types in scope of PSC requirements. The new anti-money laundering legislation extends this to credit and financial institutions, as these carry out customer due diligence.
Companies and their advisers will now need to consider how the changes are likely to impact them.
Changes to the PSC position must be promptly reported to Companies House in order to avoid financial penalty. Also, all entities must now consider whether the regime has been extended to them.
Just as companies and their advisers have got to grips with the PSC requirements, they must now quickly familiarise themselves with the new look regime.