New legislation will shortly require overseas entities holding UK land to declare their beneficial owners or managing officers under a new Register of Overseas Entities with Companies House.
This forms part of the Economic Crime (Transparency and Enforcement) Act which came into effect on 15 March 2022 and will be relevant to any legal entity that is governed by the law of a country outside of the UK. This will include companies incorporated outside of the UK even if they are UK tax resident. The purpose is to combat economic crime, while making sure that legitimate businesses continue to see the UK as a great place to invest.
Overseas entities that already hold UK land will be required to register within six months from the date the new register is launched. There is an exception to this requirement where the land was acquired by the overseas entity prior to 1 January 1999.
From the date the new register is released, it will not be possible to register the legal title, a long lease or a charge against any new UK land until the entity registration has been completed with Companies House. As such, if the overseas entity does not register, it will affect its ability to purchase, dispose, lease or create a charge over UK land. The entity could also be subject to financial penalties and further sanctions for failure to comply.
Once registered with Companies House, an overseas entity ID will be issued which will then need to be shared with the relevant land registry whenever the entity buys, sells, transfers, leases or charges land in the UK. Annual updates to the register will also need to be filed at Companies House.
At this stage, a date for release of the register has not yet been confirmed but it is expected to be during the summer 2022. We will provide further details on the registration process and information required once the secondary legislation detailing this comes into effect.
Companies House has confirmed that they will be writing to all overseas entities which will be required to register shortly. If you would like further information on whether you may be affected and/or assistance with your compliance obligations, please do get in touch.