The PSC regime will apply to all unlisted UK companies, Societas Europaea and LLPs and will require these entities to take ‘reasonable steps’ to identify any persons with ‘significant influence or control’ over the relevant entity. Although not complex, the rules do distinguish between direct and indirect control and the disclosure requirements are correspondingly different.
In the case of direct interests, details of the relevant individual controllers will need to be added to the register. For indirect interests the corporate will in the first instance need to ascertain whether the interest is held through a ‘relevant legal entity’ or not. If held through a relevant legal entity (broadly speaking a UK based corporate) only the name of that entity need be entered; the rationale being that any relevant legal entity will in turn need to maintain a register containing details of the ultimate controller or will be listed and therefore exempt. In cases where indirect interests are not held through a ‘relevant legal entity’ (through a foreign company for example) the corporate will still need to look through the intermediate entity and enter the ultimate controller’s details on its register.
From June 2016 corporates will have to file the PSC register information (including name, address, nationality and DoB of any direct controllers and name, registered office address and legal form of any relevant legal entities) at Companies House.
For corporates with straight forward ownership structures, the new PSC requirements should not be too difficult to comply with. For those with more complex ownership structures however, including for example, some PE owned entities, the PSC requirements may prove more onerous. In addition to this, the PSC rules will force the disclosure of basic details of ultimate beneficial owners of corporates covered by this legislation, whether UK based or not which could prove problematic for some.
It is worth noting the similarities between the new PSC rules and those contained in the recently adopted Fourth EU Money Laundering Directive which came into force on 25 June 2015. Although this does not need to be implemented until June 2017, the Directive contains new beneficial ownership disclosure requirements and requires Member States to ensure that any relevant entities hold beneficial ownership information on a publically accessible register. As the Directive requirements will apply to all legal entities (and not just corporates), these rules will in fact go further than the PSC requirements and it remains to be seen whether HM Treasury will allow the obligations under the Directive to be satisfied by UK corporates simply maintaining a PSC register. Irrespective of what the Treasury ultimately decides, we can be assured of greater transparency in the years to come.
The details of the new rules have been well summarised here.
Draft guidance has been issued by the Government in connection with what constitutes reasonable steps and on the meaning of significant influence or control (available here).
previous comment / Rylee Muddle
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Aztec Group Guernsey
Aztec Financial Services (Guernsey) Limited
PO Box 656, East Wing, Trafalgar Court
Les Banques, St Peter Port, Guernsey, GY1 3PP
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Facsimile: +44 1481 749749
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Aztec Financial Services (Jersey) Limited
Aztec Group House, PO Box 730
11-15 Seaton Place, St Helier, Jersey, JE4 0QH
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Facsimile: +44 1534 833033
Video Conference: +44 1534 832002
Aztec Group UK - London
Aztec Financial Services (UK) Limited
2 Throgmorton Avenue
Telephone: +44 20 3818 0250
Aztec Group Luxembourg
Aztec Financial Services (Luxembourg) S.A.
7, Rue Lou Hemmer, L-1748, Luxembourg – Findel
Grand-Duché de Luxembourg
Telephone: +(352) 24 616 000
Facsimile: +(352) 24 616 016
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Aztec Financial Services (Netherlands) BV
Spaces Zuidas, Barbara Strozzilaan 201
1083 HN Amsterdam, The Netherlands
Telephone: +31 20 794 4820
Facsimile: +31 20 794 4821
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Aztec Financial Services (UK) Limited
Forum 3, Solent Business Park
Parkway South, Whiteley, Fareham, PO15 7FH
Telephone: +44 238 202 2300
Facsimile: +44 238 202 2309