29 April 2016 by

Persons with Significant Control – How the new rules on corporate transparency will affect your company

As of 6 April 2016, most companies are required to keep a register of ‘persons with significant control’ (PSCs) over the company.  In addition, from 30 June 2016, those companies will be required to submit their PSC registers to Companies House. The new PSC regime also applies to limited liability partnerships (LLPs).

Does the new regime apply to my company?

UK companies with shares listed on the London Stock Exchange, AIM or the ISDX Growth Market, or whose shares are admitted to trading on any other EEA regulated market (or certain other specified markets), are not subject to the new PSC regime and will not be required to keep a PSC register.

All other companies and LLPs are subject to the new regime and required to maintain a PSC register.

Who is a ‘Person with Significant Control’?

  1. Anyone who directly or indirectly holds more than 25% of a company’s shares.
  2. Anyone who directly or indirectly holds more than 25% of the voting rights attaching to a company’s shares. This includes people who have agreed to act together and, collectively, have more than 25% of the voting rights.
  3. Anyone who has the right directly or indirectly to appoint or remove a majority of the directors of a company.
  4. Anyone who has the right to exercise significant influence or control over a company – for example, anyone who has an absolute right of veto over any key matters or decisions.
  5. Anyone who holds the right to exercise, or actually exercises, significant control over any trust, company, LLP or other entity that satisfies any one (or more) of the 4 conditions above.

What information needs to be recorded on a PSC Register?

The following information must be included on the register, in relation to each individual PSC:

  • Name
  • Date of birth
  • Nationality
  • Country, state or region of the UK where the PSC usually resides
  • Service address
  • Usual residential address
  • The date they are included in the PSC register (for the first time)
  • The condition(s) for being a PSC that the individual meets (i.e. the nature of his/her ‘control’)
  • Any restrictions on disclosing the information relating to the PSC

In relation to corporate PSCs, the following details are required for the register:

  • Name
  • Address of registered/principal office
  • Company registry and registration number (if applicable)
  • Legal form and governing law
  • Date included in the PSC register (for the first time)
  • The condition(s) for being a PSC that are met (i.e. the nature of the entity’s ‘control’)

The residential address and date of birth of an individual PSC will not be publicly disclosed, but all other information on a company’s PSC register will be accessible to the public.  Only in very limited cases (for example, where a PSC may be at risk of harm) can a PSC apply to keep their details confidential.

Maintaining a PSC Register

At the moment, a company’s PSC register needs to be accessible at its registered office (or another location which has been notified to Companies House).  However, after 30th June 2016, private companies can choose to maintain their PSC register at Companies House only.

Companies, and also the relevant PSCs, have a duty to ensure that the information on the register is always correct.  So the register must be updated, as soon as practicable, when there are any changes (including if any PSC ceases to be a PSC).

A PSC register should never be blank.  Even if a company has not yet discovered who should be on its register, that should be stated, and the register should also set out those steps which are being taken to identify any PSCs.  Where a company has taken all reasonable steps to do so, and is certain that there are no PSCs, then that must also be stated on the register.

If you have any questions on the new PSC regime, please contact one of our company/commercial team:

Matt Miller: 0207 288 4739 or matthewmiller@boltburdon.co.uk

Tim Lucas: 0207 288 4753 or timothylucas@boltburdon.co.uk

Adam Forder: 0207 288 4717 or adamforder@boltburdon.co.uk

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