Understanding the Economic Crime and Corporate Transparency Act 2023: Companies House Considerations
In October 2023, the Economic Crime and Corporate Transparency Act 2023 (ECCTA) received Royal Assent, marking a significant shift in the regulatory landscape for UK companies. This act, aimed at enhancing transparency and combatting economic crime, introduces several key changes. These changes directly impact Companies House and registered businesses across the UK.
Here are the changes:
Identity Verification and Enhanced Transparency
One of the pivotal changes brought about is the mandate for identity verification for all new and existing registered company directors and individuals with significant control. This measure aims to curb fraudulent activities by ensuring that individuals associated with companies are accurately identified. Companies House now has the authority to verify, remove, or decline information submitted to the register, thus preventing the misuse of fake identities for business purposes.
New Address Requirements
In addition to identity verification, the ECCTA imposes new address requirements for registered companies. Each company on the register must now have a registered email address, and there are stringent rules regarding registered office addresses. PO Boxes are no longer acceptable, and companies must maintain an “appropriate address” where documents can be reliably received and attended to by authorised personnel.
Additional Compliance Measures
The ECCTA introduces a range of compliance requirements, particularly affecting small and micro-sized companies. Abridged accounts will eventually be phased out, and companies will be required to file their profit and loss accounts in iXBRL format. Limited Partnerships (LPs) used in corporate structures will face increased scrutiny, with Companies House demanding more comprehensive information.
Enforcement and Broader Powers
To bolster enforcement efforts, the ECCTA grants Companies House expanded investigative and enforcement powers. The Registrar is empowered to request additional information, query existing filings, and amend or remove inaccurate information to maintain the integrity of the register.
How Can Companies Ensure Compliance?
Given the complexities introduced by the ECCTA, companies may benefit from professional assistance to navigate these regulatory changes effectively. Authorised Corporate Services Providers, such as accountants, can aid in identity verification and ensure compliance with filing requirements. Additionally, companies should proactively review their corporate structures and make necessary adjustments to align with the new regulations.
We can help
The ECCTA represents a significant step towards enhancing corporate transparency and combating economic crime in the UK. Companies must proactively adapt to these changes to ensure compliance and uphold the highest standards of transparency and accountability in their operations.
We can assist clients in reviewing corporate structures and provide support with restructuring as required. Where we complete company filings we will be updating the email requirements when filing up-to-date confirmation statements.
