Companies House announces key implementation dates for the Economic Crime and Corporate Transparency Act 2023
25 October 2024
- Contact Carolyn Arlett
- Corporate Secretary
- [email protected]
- +44 7587 031 073
The Economic Crime and Corporate Transparency Act (ECCTA), which became law on 26 October 2023 is the second part of a legislative package to prevent the abuse of UK corporate structures and tackle economic crime.
The ECCTA contains wide-ranging provisions to:
- prevent organised criminals, fraudsters, kleptocrats and terrorists from using companies/corporate entities to abuse the UK’s open economy;
- strengthen the UK’s response to economic crime – in part through improved transparency and in part by giving law enforcement new powers; and
- Improve the reliability of data held at Companies House to inform business transactions and lending decisions across the economy.
Key sections of the ECCTA concern Companies House powers to query, challenge and remove inaccurate information on its registers, and we now have a clearer understanding of the implementation timetable for these changes.
It is essential that directors, owners, controllers and advisors of UK registered companies be aware of the provisions of the ECCTA to ensure they remain compliant and are prepared for further changes.
An outline summary of the key changes already in force alongside those which will be enacted over the next two years is set out below.
Q1 2024 (completed)
- Companies House granted greater powers to query information on the register
- Introduction of new lawful purpose statements
- Requirement to provide a registered email address
- Requirement for the registered office to be an ‘appropriate’ physical address
Q2 2024 onwards
- Companies House granted power to impose financial penalties ranging between £250 – £2,000 for offences of non-compliance with provisions of the Companies Act 2006
Phased in during 2025
- Changes to the way that directors are appointed, including identity verification for new and existing directors
- New director appointments will not be effective until approved by Companies House
Q1 2026
- Anyone filing information with Companies House will need to have first verified their own identity
End of 2026
- All individuals listed at Companies House (including existing directors and Persons of Significant Control) must have finished verifying their identity
- Limited Partnerships to submit additional information
The Government has also confirmed that provisions originally contained in the Small Business, Enterprise and Employment Act 2015 to restrict the use of corporate directors of UK companies will be brought into force in parallel with the measures in the ECCTA. This will mean that any corporate director of a company must have an all-natural person board, who will themselves be subject to identify verification requirements.
To help facilitate identity verification, Authorised Corporate Service Providers (ACSPs), which are persons or firms who are regulated under the UK Money Laundering Regulations, will be able to complete the mandatory identity verification on behalf of their clients and confirm this to Companies House through a ‘verification statement’. Engaging an ACSP will provide the convenience and reassurance to UK registered companies that the initial verification has been completed properly and within time.
Further information about the new identity verification rules and other changes introduced by the ECCTA is available on the government website Changes to UK company law – Changes to UK company law.
How ZEDRA can help
At ZEDRA, we work with companies to ensure efficient administration by managing their compliance with statutory and regulatory requirements. We also provide advice to Board members on their legal responsibilities and corporate governance issues. We can support both new and existing clients with the new verification and filing requirements as we will be registering as an ACSP, once these changes are implemented from 2025.
If you would like more information on what the changes in this legislation mean for you, or our company secretarial and registered office services, please contact Carolyn Arlett.