A publicly accessible Register of Overseas Entities came into force on 1st August 2022 through the Economic Crime (Transparency and Enforcement) Act 2022.
The register, which is held by Companies House, requires overseas entities that own UK land or property to declare their beneficial owners and/or managing officers within the six-month window ending 31st January 2023.
For non-compliance, fines of up to £2,500 per day or a prison sentence of up to 5 years may be levied; in addition to restrictions on buying, selling, transferring, leasing or charging of land or property in the UK.
There is a £100 registration fee payable when applying to register an overseas entity.
Who is affected?
The new rules apply to non-UK legal entities which are principally companies and certain partnerships (including those incorporated in Jersey, Guernsey and Republic of Ireland) who wish to buy, sell or transfer property or land in the UK.
Retrospectively it also applies to:
- Non-UK legal entities which own UK land and property and acquired this after 1st January 1999 (8th December 2014 in Scotland and 1st August 2022 in Northern Ireland).
- Non-UK legal entities which no longer own UK land and property but sold UK land and property on or after 28th February 2022.
Information that must be provided
Registrations from overseas legal entities must include the following:
- Details about the overseas entity;
- Details of any registrable beneficial owners; and
- Details of the UK-regulated agent that carried out verification checks.
Individuals and legal entities will be registrable beneficial owners if they meet one or more of the following conditions, and are not exempt for any other reason:
- They directly or indirectly own 25% of the shares in the overseas entity;
- They directly or indirectly own more than 25% of the voting rights of the entity;
- They hold the right to appoint or remove the majority of the Board;
- They have the right to exercise, or do exercise, significant influence or control over the entity.
If there are no beneficial owners or they all can’t be identified, the information pertaining to the overseas entity’s managing officers must be provided. If any of the registerable beneficial owners are trusts, information about that trust will also need to be provided.
A UK-regulated agent, which is supervised under the Money Laundering, Terrorist Financing, and Transfer of Funds Regulations 2017, must complete verification checks on all beneficial owners and managing officers of an overseas entity before it can be registered.
These checks must be completed no more than 3 months before the registration. The agent must provide an agent assurance code and an overseas entity verification checks statement to confirm that these checks have been performed.
After registering, the overseas entity will get a unique Overseas Entity ID to give to the land registry when it buys, sells, transfers, leases or charges UK property or land.
The overseas entity, its beneficial owners and managing officers, will be added to the Register of Overseas Entities.
An annual update is required that either:
- Confirms the overseas entity has no reasonable cause to believe that any registrable beneficial owner has become or ceased to be such during the update period; or
- Provides details and relevant dates of each person who became or ceased to be a registrable beneficial owner during the update period.
The deadline for the annual reporting is 14 days from the end of the year, based on the anniversary date of the registration.
As always, if you would like any further information regarding the above, please feel free to contact our offices by email firstname.lastname@example.org.