The first set of measures in the UK’s Economic Crime and Corporate Transparency Act, designed to give Companies House more power in fighting fraud and other economic crime, are scheduled to take effect 4 March.
The act, which received royal assent on 26 October last year, includes measures that “will lead to improved transparency and more accurate and trusted information on our registers”, a UK government publication said.
The measures will lead to new responsibilities for new and existing company directors, people with significant control of a company, or those who file on behalf of a company.
The upcoming reforms include:
- Introducing identity verification for all new and existing registered company directors, people with significant control, and those who file on behalf of companies.
- Broadening powers to become a more active gatekeeper over company creation and more reliable data.
- More reliable and accurate financial information on the register, which reflects the latest advancements in digital technology and enables better business decisions.
- Providing Companies House with more effective enforcement powers and increasing the ability to share relevant information with partners.
- Enhancing the protection of personal information to protect individuals from fraud and other harms.
The new measures also intend “to balance the need for corporate transparency with the understanding that personal information should only be published when it’s necessary and proportionate to do so”, the government said.
These measures will come into force over the next two years in a phased approach.
Companies House reform is a key action under the UK’s Economic Crime Plan 2023–2026. CIMA, in its role as a UK Anti-Money Laundering Supervisor, is working with the government and relevant agencies in the delivery of that plan.
Elaine Smyth, CIMA associate director–Professional Standards and co-chair of the UK’s Accountancy Anti-Money Laundering Supervisors Group, said: “These are the most significant changes to Companies House in the last 170 years. The increased transparency of entities on the Companies House register is a welcome step in reducing the risk of companies being used as a vehicle for money laundering. CIMA will continue to work closely with Companies House on the delivery of the new measures.”
— To comment on this article or to suggest an idea for another article, contact Steph Brown at Stephanie.Brown@aicpa-cima.com.
