The Register of Overseas Entities came in to force on 1 August 2022. The Register’s aim is...
The Register of Overseas Entities came in to force on 1 August 2022. The Register’s aim is to increase the transparency of ownership of property in the UK. Organised crime is known to use opaque offshore corporate structures to launder funds through the UK property market and the new regime should make this more difficult.
An overseas entity is defined as a company or partnership or other entity which is governed by the law of a country outside the United Kingdom.
With effect from August 2022, all overseas entities who want to buy, sell or transfer property or land in the UK, must register with Companies House and register who their registrable beneficial owners or managing officers are. Overseas entities buying property in the UK must register the beneficial owners on the register before they can apply to HM Land Registry to become the registered owner of the land.
The regime also applies retrospectively to overseas entities which already own land that was bought or transferred on or after 1 January 1999 in England and Wales or 8 December 2014 in Scotland.
The information required to be delivered to Companies House is similar to the information currently required for English companies such as details of their PSCs - “persons of significant control”. However, in the case of overseas entities, the information provided to Companies House must be verified by an independent person – such as a bank, corporate service provider or someone from a regulated profession such as lawyer or accountant. The information will also need to be updated annually.
Overseas entities that already own UK property, have a grace period of 6 months from 1 August to register their beneficial owners and in some cases give information on their managing offices and any superior trusts, meaning that this registration must be completed or on before 31 January 2023. Failure to comply will render the directors of such overseas entities liable to a fine or imprisonment. The Economic Crime (Transparency and Enforcement) Act 2022, which introduced this new regulatory regime, also provides for further regulations to be introduced in due course to enable Companies House to impose other financial penalties for non-compliance.
If you are engaged in a transaction involving the acquisition of an interest in land from an overseas entity, then you need to check whether the overseas entity is registered with Companies House. If it is not, then your transaction may be delayed.
Please contact David Morrison on 01689 887838 or email david.morrison@cwj.co.uk if you have any questions about the Register of Overseas Entities.