From 6 April 2016 all UK companies (except certain public companies) and Limited Liability Partnerships are required to maintain a new section of their Statutory Register known as the People with Significant Control Register (PSC Register). These changes form part of the Government’s drive to improve transparency in corporate structures by detailing individuals, and other corporate entities that exert a ‘significant control’ over a company.
A company’s PSC Register will need to include such details as; the name, date of birth, country of residence, nationality and service address of those individuals who have a ‘significant control’ over the company.
In addition to maintaining the PSC Register, companies will also be required to lodge a copy of the PSC Register with Companies House from 30 June 2016. The Register will then be available for public inspection.
The PSC Register should contain the details of individuals and corporate entities who fall within the following category:
- owns more than 25% of the company’s shares (directly or indirectly);
- owns more than 25% of the company’s voting rights (directly or indirectly);
- has the right to appoint or remove a majority of the board of directors of the company;
- has significant influence or control over the company; and/or
- has significant influence or control over a trust or firm which has significant control over the company.
The maintenance requirement associated with the PSC Register also extends to those companies with no individuals who can be classed as having a significant control. The Department of Business, Innovation & Skills have provided non statutory guidance for companies in this respect.
The PSC Register requirements are marginally different for Limited Liability Partnerships with the addition that an individual should be placed on the PSC register if they would hold rights over more than 25% of the surplus assets in the event of a winding up of the partnership.
The Government has taken a strict approach to potential breaches of the PSC Register requirements with restrictions imposed on shares and criminal sanctions being the most serious threats that a company and it’s Directors could be faced with if they fail to comply.
As always, it is vital that businesses are aware and remain compliant with their obligations to new legislation.
Martyn Tennant (firstname.lastname@example.org) and Alex Wilby (email@example.com), our Partners within our Corporate Team are well placed to assist should you have any queries or require any training on the new legislation.