January 8, 2024 New milestone for Overseas Property Register
One element of the drive to increase transparency in property and company ownership; the Register of Overseas Entities came into being in August 2022. Established by the Economic Crime (Transparency and Enforcement) Act 2022, the register requires overseas entities buying, selling, or transferring property or land in the UK to register details of beneficial ownership with Companies House.
The measure applies not only to new purchases but also to overseas entities who bought property or land on or after 1 January 1999 in England or Wales, 8 December 2014 in Scotland, and 1 August 2022 in Northern Ireland. The transition period for declarations expired on 1 January 2023. At that time it was estimated that some five thousand companies still had to register details of their beneficial owners. As a result of this and of further overseas property transactions the register continued to grow throughout 2023. Between June and December some two thousand further entries were made, leading to Companies House declaring in December that in excess of 30,000 entries now sit on the register.
Commenting on this new milestone the Director of Intelligence and Law Enforcement Liaison at Companies House, Martin Swain, said: “Reaching 30,000 registrations is a significant milestone but also a positive sign that the register is achieving its objective of enhancing transparency of ownership of land and property in the UK by foreign entities.” He went on to say: “Our focus remains on continuing to improve the register and rigorously enforcing compliance, so this transparency is maintained and enhanced yet further.”
It should be noted that registration is not a one-off event. Once on the register, entities are required to file an annual update statement, either confirming that previous information provide remains unchanged or giving details of any alterations including changes of beneficial ownership. That update has to be filed within 14 days of the anniversary of the original, or last filing: although early updates are allowed.
As with the initial filing, any changes must have been verified by a UK-regulated agent such as Elemental CoSec. However, particularly in the case of trusts, it can take some time to obtain and properly verify details of beneficial owners so we would recommend that in cases where changes have taken place entities do not leave it until the last minute to start the verification process.