Partner and Head of Wills & Estate Planning at Andrew & Co Solicitors Helen Newson writes...
Will New Companies House Regulations Impact My Business?
- AuthorPaul Simpson
As of 26th June 2017, new regulations for the filing of persons with significant control at Companies House came into force, changing the registration process. You must be aware of these changes as you may face prosecution if you fail to comply with them.
Who can be a Person with Significant Control (PSC)?
A person has significant control over a company if:
- they hold more than 25% of the shares in the company;
- they hold more than 25% of the voting rights in the company; or
- they hold the right to appoint or remove a majority of the board of directors of the company.
A person may be a PSC if that person “has the right to exercise, or actually exercises, significant influence or control" over the company. You should be aware of what constitutes ‘significant influence’ or ‘control’. Significant influence could include where a person can ensure that a company adopts activities which that person desires, and control could include where a person can direct the activities of a company.
There are a number of relationships which, on their own, would not result in that person exercising significant influence or control. Such relationships include: advice being given by a lawyer in a professional capacity, or a supplier acting under a third party commercial agreement.
How new PSC rules will affect your company
Under the old rules, if there was a change to the PSC register of your company, you would be required to send Companies House up-to-date versions of your PSC registers on an annual basis.
This changed on 26th June 2017, and a strict timeframe now regulates when Companies House should be in receipt of updated PSC registers. The new PSC rules mean that qualifying companies must enter this information on their own PSC register within 14 days of becoming aware that a person meets the PSC qualification. Within a further 14 days, those companies must then update the central public register at Companies House.
Qualifying companies have been extended to cover: incorporated companies limited by shares, companies limited by guarantee, unlimited companies, SEs, unregistered companies, and listed companies on UK secondary markets (for example, the NEX Exchange).
You can find more guidance on PSC requirements at Gov.uk.
Penalties for not registering a PSC
It is important that your company registers PSC at Companies House within the 14-day time frame as you may be subject to a fine or even up to two years’ imprisonment.
How can Andrew & Co Solicitors help you?
If you require any assistance or advice on PSC, keeping up-to-date company records with Companies House or any other corporate and commercial law matter, please contact our Head of Corporate and Commercial Paul Simpson on 01522 781461 or email email@example.com.