Company Law Reform ' Changes Planned To Improve Corporate Transparency

• Published date: 27 October 2020
• Subject Matter: Corporate/Commercial Law, Corporate and Company Law, Directors and Officers
• Law Firm: Walker Morris
• Author: John Hamer , Debbe Jackson, Richard Naish, Daniel O'Gorman, Jo Stephenson and Oliver Duke

Towards the end of September 2020, the Department for Business, Energy and Industrial Strategy (BEIS) published its findings in relation to the consultation on corporate transparency and Companies House reform which it launched in May 2019. The response document contains an overview of Government's proposed reforms to be introduced over the coming months. The reforms fall into four separate categories.

Knowing who is setting up, managing and controlling corporate entities

The plan is to introduce compulsory identity verification for all directors and people with significant control (PSCs) of UK registered companies, general partners in limited partnerships, designated members in LLPs, and all individuals who file information on behalf of a company. All company directors and PSCs will need to have a verified account at Companies House, which can be set up directly or through an agent. Where the application to incorporate and subsequent filings are provided through an agent, that agent will also need to have its own account. Only bodies that are covered by appropriate UK anti-money laundering regulations and are deemed to be properly supervised, will be eligible to obtain Companies House accounts.

Improving the accuracy and usability of data on the companies register

Under the reforms, the registrar of companies will be given a statutory discretion to query and check information that is submitted to Companies House before it is placed on the register. Government will consult further on the specifics of these reforms and provide further details of the circumstances under which these new powers might be triggered. We will keep track of developments in this area.

The registrar will also be given extended powers to amend information that is already on the register. Current administrative procedures that require an application to Companies House or a court order will be simplified.

Finally in this category, Government is considering reforms to the filing of accounts which it will consult further on. The proposals are to introduce full iXBRL tagging for the submission of accounts to Companies House to mirror the formatting requirements for...