Companies must identify ‘People with Significant Control’

Companies House has issued new guidance to help directors comply with regulations relating to identifying and recording who owns or controls the business.

The owner or the person who makes the key decisions is known as a Person with Significant Control (PSC) or the ‘beneficial owner’.

Companies must identify their PSCs when registering with Companies House. If they believe they don’t have one, they must explain why.

Most PSCs are likely to be people who hold:

• more than 25% of the shares in the company
• more than 25% of voting rights in the company
• the right to appoint or remove the majority of the board of directors.

A PSC might influence or control a company through other means. This could be directly, or on behalf of someone else. For example, someone who tells the directors or shareholders what to do.

If a trust or firm influences or controls a company and meets any conditions of control described above, they must be identified as a PSC of the company.

Companies need to confirm certain details with their PSC and record them in the PSC register. These details are:

• name
• date of birth
• nationality
• country of residence
• service address
• usual residential address (not displayed to the public)
• the date they became a PSC of the company
• the date you entered them into your PSC register
• which conditions of control are met.

You must include the level of their shares and voting rights, within the following categories:

• over 25% up to (and including) 50%
• more than 50% and less than 75%
• 75% or more.

A PSC must provide the required information. If they fail to do so they would be committing a criminal offence.

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