Register of People with Significant Control

From 6 April 2016, all UK private companies, including companies limited by guarantee, and UK LLPs are required to keep and maintain a statutory register of people with significant control (PSCs). Companies that already disclose information about ownership of shares under the FCA’s Disclosure and Transparency Rules are exempt from the requirement.

Such companies and LLPs are also required to record the required particulars of relevant legal entities (RLEs) that would hold significant control if they were individuals.

An individual or legal entity will be a PSC where one or more of five specified conditions are met:

• Condition 1: the individual or entity holds, directly or indirectly, more than 25% of the shares in the company;

• Condition 2: the individual or entity holds, directly or indirectly, more than 25% of the voting rights in the company.

• Condition 3: the individual or entity holds the right, directly or indirectly, to appoint or remove a majority of the board of directors of the company.

• Condition 4: the individual or entity has the right to exercise, or actually exercises, significant influence or control over the company.

• Condition 5: the individual or entity has the right to exercise, or actually exercises, significant control or influence over the activities of a trust or firm that, in each case, does not have legal personality under its governing law, where the trustees or members of that trust or firm otherwise meet the above conditions.

From 30 June 2016, companies and LLPs are required to give details of PSCs and RLEs annually to Companies House when making the Confirmation Statement (which replaces the annual return).

Upon the creation of the PSC register, a company is obliged to investigate whether it has any registrable PCSs or RLEs. Notices must be sent to anyone in respect of whom the company knows, or has reasonable cause to believe, to be a registrable PSC or RLE. Failure to take reasonable steps in this regard may lead to a criminal offence by the company and every officer in default.

Corresponding obligations fall upon PSCs and RLEs to respond to notices and to provide information where they know themselves to be a registrable PSC or RLE. Failure to give notice when requires is a criminal offence.

Exceptions apply where the company has already been informed of that person’s status and has been supplied with the required particulars in respect of that person.

A PSC register, once created, must not be blank. Non statutory guidance sets out the official wording to be entered on the register and when filing information at Companies House where the company is in the process of identifying PSCs and RLEs.

Specific legal advice should be taken to ensure compliance with the above requirements.

For more information, please contact our business team:

https://www.foskettmarr.co.uk/index.php/our-team/business-solicitor-essex/