As from 6 April 2016, legislation will come into effect which will make it compulsory for all non-listed UK companies, active or dormant, to create and maintain a register of persons with significant control (PSC). This needs to be kept with the other statutory registers of a company and to be available for inspection by the public. In order to comply with these new regulations, it will be necessary to take reasonable steps to identify PSC’s within the company and to have a register in place by the 6 April 2016. In order to be classified as a PSC, an individual or company must satisfy one or more of the following five conditions: If the PSC is a limited company incorporated within the EU, then details of that company must be recorded on the register.
- Directly or indirectly hold more than 25% of the shares,
- Directly or indirectly hold more than 25% of the voting rights,
- Directly or indirectly hold the right to appoint or remove a majority of directors,
- Otherwise have the right to exercise, or actually exercising, significant influence or control,
- Have the right to exercise, or actually exercising, significant influence or control over the activities of a trust or firm which is not a legal entity, but would itself satisfy any of the first four conditions if it were an individual.
If the PSC is a limited company incorporated outside the EU, then details of the individuals who have a significant interest in that company must be recorded on the register The PSC register must contain details of the company’s investigation into its PSC’s, the necessary particulars of any PSC’s and the nature of their control over the company. There is prescribed wording set out in the legislation that must be used; this wording varies dependent on the circumstances. From 30 June 2016 onwards, this information must be delivered annually to the central public register at Companies House when making a Confirmation Statement (which will replace Annual Returns as from 30 June 2016). Again, there is prescribed wording that must be used when filing the Confirmation Statement. Government Guidance has been issued regarding these obligations, including a summary of what information must be recorded and the prescribed wording that must be used. The Guidance can be accessed here. Non-compliance with the above is an offence for the company and its directors, punishable by a fine or up to two years imprisonment. If you require any further information regarding these obligations, please contact Paul Warman, Head of our Corporate Team.