Important reforms designed to increase the transparency of the ownership and control of UK companies and English law LLPs were introduced in the UK on 6 April 2016. Among the most significant of these was a requirement for UK companies and English law limited liability partnerships (LLPs) to maintain a compulsory statutory register (the “PSC register”) of certain persons with significant control (PSCs), who are usually individuals, and registrable relevant legal entities (RLEs). This is referred to as the PSC Regime.
When the PSC Regime was introduced, the requirement to maintain a PSC register applied to English law LLPs and most UK incorporated companies. However, certain UK incorporated companies fell outside the PSC Regime and did not need to maintain a PSC register, these were:
The Information about People with Significant Control (Amendment) Regulations 2017 (the “PSC Amendment Regulations”) came into force on 26 June 2017 and form part of the UK’s implementation of Directive 2015/849/EU (the “Fourth Money Laundering Directive”) which EU member states were required to implement on that date.
The main changes introduced by the PSC Amendment Regulations are to:
Additional entities fall within the PSC Regime
As a result of the PSC Amendment Regulations entering into force, additional entities now fall within the PSC Regime which has been extended to include:
These changes mean that the only UK-incorporated companies that are exempt from the PSC Regime are:
Actions to be taken by UK-incorporated AIM-listed companies
Unless a UK-incorporated AIM-listed company falls within one of the exemptions listed above, it is now subject to the PSC Regime and must:
Failure to comply with the PSC Regime is a criminal offence and the company and its directors and officers may be subject to an unlimited fine or imprisonment for up to two years or both.
Therefore UK-incorporated AIM companies should investigate and collect information on their PSCs and RLEs. Where appropriate, they should issue notices to any registrable PSCs (or persons whom they have reasonable cause to believe may be registrable) to help identify them correctly and to obtain the information necessary to complete the PSC register. Notices should also be issued to obtain the prescribed information required in respect of any registrable RLEs to enable the AIM company to complete its PSC register. The PSC register should also be drawn up, and companies should ensure that it is ready by 24 July 2017 and any other filings required by Companies House should also be prepared.
New filing requirements
Subject to a short transitional period for UK-incorporated AIM-listed companies, from 26 June 2017 all companies subject to the PSC Regime must:
Manner in which information is notified and other changes
Should you require any further guidance on the PSC Regime, its application and how to identify PSCs and RLEs, please contact us.
Nikki Blair, a Professional Support Attorney in Morrison & Foerster’s London office, assisted in the preparation of this client alert.