July 5, 2022 Register of overseas entities takes a step closer
In March 2022 we looked at the implications of the Economic Crime (Transparency and Enforcement) Act. In particular, we examined the proposals to set up a register of UK property owned by overseas entities.
At the time it was envisaged that the register might take a while to come into force, with further legislation and background research required by various departments and bodies including HM Land Registry. Now the register has come a step closer to inception with the laying of a statutory instrument, sometimes known as secondary legislation, in Parliament on 26th June. This covers three aspects of the new register.
Firstly, the legislation confirms that the Register of Overseas Entities will be a digital service with entities, or their agents, being required to submit information online. Secondly, although the name of overseas entities and beneficial owners would generally be publically available, the secondary legislation enables information to be protected from public view if publication could result in an individual being at serious risk of violence or intimidation. This will be similar to the protection currently available for UK directors or persons with significant control.
Finally, the secondary legislation confirms that beneficial owners must be declared if that beneficial owner is a legal entity governed by the law of a country or territory outside the UK, or provides trust services where the provision of trust services is regulated in that country by a supervisory authority.
Companies House have confirmed that two further statutory instruments are being prepared with the expectation that the new register will launch in the summer of 2022. Following the launch, overseas entities which already own land or property in England, Wales, or Scotland will have six months to register beneficial owners. Companies House are therefore urging entities affected to start to gather the required information in order to be ready to update the register as soon as possible after the live date.
Those overseas entities with property in Northern Ireland will only have to register in respect of new properties purchased after the launch date. However, it is worth noting that whether in Northern Ireland, England, Scotland, or Wales, overseas entities purchasing land or property after the live date will have to register their purchase with Companies House before registering it with the relevant land registry.
It is also worth noting that the Register of Overseas Entities will need to be verified or updated each year.
How Elemental can help
On 1 August 2022, on the day the new rules went live, Elemental was one of the first providers to launch a fully managed Register of Overseas Entities Service for law firms, professional advisors, and clients looking for help with registration and verification.