Companies must hold register of ‘People with Significant Control’

Companies in the UK must now have a register of ‘People with Significant Control’ to provide greater transparency for consumers and other businesses.

The register should include basic information about who owns or controls the company, including their name, month and year of birth, nationality, and details of their interest in the business.

A person of significant control is defined as someone who holds more than 25% of shares or voting rights in a company, or who has the right to appoint or remove the majority of the board of directors. The regulation came into effect on 6 April under the Small Business Enterprise and Employment Act.

From 30 June this year, UK companies (except listed companies) and limited liability partnerships (LLPs) will need to declare this information when issuing their annual statement to Companies House.

The Business Minister, Baroness Neville-Rolfe, said: “Companies that disguise who owns or controls them are not playing by the rules and have something to hide. This register, the first of its kind in the world, will help tackle abuse of corporate entities. This is part of our commitment to creating an environment of trust and accountability for business.

“Some of the features of the company structure which make it good for business also make it attractive to criminals. Companies can be misused to facilitate a range of criminal activities – from money laundering to tax evasion, corruption to terrorist financing.

“Information about the ownership and control of UK corporate entities will bring benefits for law enforcement, business, civil society and citizens. By making this information publicly available, free of charge, the government is setting a standard that we are persuading other countries to follow.”

Please contact Sing Li if you would like more information about the issues raised in this article or any aspect of company law.