The Government has introduced the Small Business, Enterprise and Employment Bill (the “Bill”) to Parliament, which includes proposals to increase transparency in the ownership and control of companies.
The Bill includes, among other things, amendments to the Companies Act 2006, which would:
– require companies to identify those persons with significant control over the company and keep a publicly available register of them (PSC register). The provisions will not apply to limited liability partnerships (LLPs);
– prevent the creation of new bearer shares and require existing bearer shareholders to surrender their shares to the company in exchange for registered shares;
– prohibit the use of corporate directors by UK companies subject to limited exceptions. Exemptions for group structures involving large listed and private companies are being considered together with an extension to the prohibition to LLPs;
– replace the current requirement for an annual return with an obligation to confirm at least once in a 12-month period that all required information has been delivered to Companies House; and
– give private companies the option of holding the information required by certain statutory registers (including the register of directors, directors’ residential addresses, members and secretaries and the PSC register) on a public register instead.
The Bill also includes additional measures:
– introducing a right for companies to impose restrictions on shares without a court order where a person with a relevant interest in the company has failed to comply with its disclosure obligations;
– allowing companies to give notice to a person if the company knows, or has a reasonable belief, that the person knows the identity of an individual or legal entity with significant control in relation to the company; and
– applying the general duties of directors to shadow directors.
The final outcome of the proposals remains to be seen.
Should you have any queries regarding the Companies Act 2006 or compliance generally, please contact
Keith Kennedy, Partner in the Corporate and Commercial department, at
email@example.com or by telephoning 0161 833 9211.
The information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Berg or any of its partners or employees. Professional legal advice should
be obtained before taking, or refraining from taking, any action as a result of this article.