People with Significant Control Overview
From 6 April 2016 companies, Societates Europaeae (SEs) and Limited Liability Partnerships (LLPs) must keep a register (the PSC Register) of individuals or legal entities that have control over them. This is in addition to keeping other information, such as a register of members and a register of directors.
From 30 June 2016 onwards companies, SEs and LLPs will have to deliver this information annually at Companies House when making a Confirmation Statement. (This is the replacement to the annual return and incorporates the PSC information).
If your company was incorporated before 30 June 2016 you will simply enter your company’s PSC information on the first confirmation statement submitted to companies house.
If you are incorporating a new company after the 30 June 2016, you will need to complete a statement of initial control, containing your company’s PSC information as part of the registration process.
Who Qualifies as a PSC?
A PSC is an individual who meets one or more of the following conditions in relation to your company:
- Directly or indirectly holding more than 25% of the shares
- Directly or indirectly holding more than 25% of the voting rights
- Directly or indirectly holding the right to appoint or remove a majority of directors
- Otherwise having the right to exercise, or actually exercising, significant influence or control
- Having the right to exercise, or actually exercising, significant influence or control over the activities of a trust or firm which is not a legal entity, but would itself satisfy any of the first four conditions if it were an individual.
A PSC is by definition an individual, and not a legal entity (such as a company or a Limited Liability Partnership). But your company might be owned or controlled by a legal entity, not an individual. A legal entity’s details must be put on the PSC register if it is both relevant and registrable in relation to your company. This broadly means that it either, has its own PSC register, is subject to disclosure and transparency rules. It could also mean that it has voting shares trading on a regulated market in UK, EU or on specified markets in Switzerland, the USA, Japan or Israel and is the first relevant legal entity in your company’s ownership chain.
What information should the PSC register contain?
The PSC register must never be empty and all entries must be in line with the official wording. Even the fact that, reasonable steps are taking place in order to obtain the information, must be entered in your PSC register.
Once the PSC are identified the following information must be obtained, confirmed and then entered in to the PSC register:
- Date of birth
- Country, state or part of the UK where the PSC usually lives
- Service address
- Usual residential address
- (If the residential address has already been given because it is also the service address, then you do not need to give it again)
- The date when the individual became a PSC in relation to your company
- Which of the five conditions for being a PSC the individual meets, with quantification of the interest
- For a PSC who meets one or more of conditions (i) to (iii) your company is not required to identify whether they also meet condition (iv)
- Any restrictions on disclosing the PSC’s information that are in place
For a registrable RLE, the following must be obtained, confirmed and then entered on the PSC register:
- Name of the legal entity
- The address of its registered or principal office
- The legal form of the entity and the law by which it is governed
- If applicable, a register in which it appears (including details of the state) and its registration number
- The date when it became a registrable RLE in relation to your company
- Which of the five conditions for being a PSC it meets, with quantification of its interest where relevant
- For a RLE that meets one or more of conditions (i) to (iii) your company is not required to identify whether they also meet condition (iv)
The PSC requirements apply whether your company has a PSC or not. If you are confident that there are no PSC then this fact must be stated in the PSC register.
What are the obligations on the entity?
On behalf of your company, you must:
- take reasonable steps to find out if there are people who hold significant control;
- contact these people, or others who might know them, to confirm whether they meet one or more of the conditions and, enter in the company’s PSC register;
- file the information at Companies House (applicable from 30 June 2016);
- keep the information up-to-date – Failure to do so is a criminal offence.
- enable any individual or organisation with a proper purpose to access the register free of charge.
If you would like any further guidance on the PSC register then please do not hesitate to get in touch with your usual Albert Goodman contact who will be more than happy to help. Further information , provided by the Department for Business, Innovation and Growth can be found here.