Are you ready for the PSC register? New rules from 6 April
The Small Business, Enterprise and Employment Act 2015 (SBEE) materially reforms UK company law with key changes being implemented in different stages.
One of the changes is the introduction of a central public registry of those individuals or entities who have significant control of UK companies (known as PSCs and RLEs).
- From 6 April 2016 companies and limited liability partnerships (LLPs) must keep a register of individuals or legal entities that have significant control over them (known as a PSC register).
- From 30 June 2016 onwards companies and LLPs will have to deliver this information to the central public register at Companies House when making a confirmation statement. (It is anticipated that this requirement will tie in with the requirement for companies to submit an annual confirmation statement rather than an annual return.)
- From 30 June 2016 those setting up a new company or LLP will have to send a statement of initial significant control to Companies House, alongside the other documents needed when applying to incorporate.
Who is a person with significant influence or control (PSC)?
Companies – if a person holds, owns or controls more than 25% of a UK company’s shares or voting rights, or who otherwise exercises significant influence or control over the company or its management.
LLPs – if a person holds the right to more than 25% of the assets on a winding up, holds more than 25% of the voting rights, or holds the right to appoint or remove a majority of management.
This is a brief summary of who can be called a PSC. For detailed statutory guidance on understanding the meaning of significant influence or control please click on these links if you are a company or an LLP or visit www.icsa.org.uk
Risk of non-compliance
The majority of UK companies will need to comply with the provisions of these obligations or risk being convicted of a criminal offence, (broadly speaking, UK listed companies are exempt as they are already subject to disclosure requirements under their listing rules). The offence is punishable by a fine and/or up to two years imprisonment.
Over the next few months an officer of the company should:
- identify PSCs in the company and confirm their details using the guidance above
- record the details of the PSC on the company register
- provide the information to Companies House as part of the confirmation statement
- update the information on the company register as and when it changes, and update at Companies House when it makes its next confirmation statement.
The PSC register can never be blank. Where for some reason, the PSC information cannot be provided, other statements will need to be made explaining why the PSC information is not available.
For further guidance on this please refer to annex 2 and section 8.9 of the draft guidance, the summary (non-statutory) guidance or their website www.icsa.org.uk or contact our corporate & commercial lawyers.