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Major New Filing Rules for Companies - Is Your Business Ready?

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From January 2016, nearly all companies, regardless of size or turnover, must produce, file and keep an up to date “person(s) with significant control register” (the PSC Register). The individual “person(s)” (PSCs) are defined as anyone who holds, directly or indirectly:

  • 25% (or more) shares
  • 25% (or more) voting rights
  • The right to appoint or remove a majority of the board of directors
  • The right to exercise significant influence or control over the company, or
  • The right to exercise significant influence or control over a trust or firm which meets one or more of the above.

Sometimes, legal entities must also be filed in a PSC Register. Statutory guidance is expected soon on this and on the meaning of “significant influence and control”, as well as how a register should be laid out and the information that must be filed in it. 

Companies will be required to compile their PSC Register from January 2016, with compulsory filing at Companies House from April 2016. They must serve notice on everyone they believe to be PSCs and fully investigate who their PSCs are. Failure to do so is a criminal offence - both by the company and its officers - that is punishable by imprisonment and/or a fine. 

Some PSCs will be reluctant to give their details, e.g. for anonymity and tax avoidance. If they do not cooperate, companies can impose sanctions against them, e.g. suspension of shares. Failure by anyone to provide their details is also a criminal offence, punishable by imprisonment and/or fine. However, those at serious risk of harm can apply to the Registrar of Companies to prevent their information being publicly disclosed.

For larger and more complex companies, administering PSC could be costly and time consuming.

The rules are designed to boost transparency and business trust, but they could have the reverse effect on some firms, who’s PSC may be involved with other controversial concerns or have a poor public image. As a result, consumers and clients may refuse to do business with that company.

If you have any questions about the PSC Register, its implications for your business or yourself, or how to implement the new rules, please contact Michael Cantwell on 00 44 113 399 3457 or email michaelcantwell@hlwkeeblehawson.co.uk

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