Changes Being Implemented Under the Economic Crime & Corporate Transparency Act 2023

The reforms introduced under the Economic Crime and Corporate Transparency Act 2023 are being implemented in phases. The first phase of this implementation occurred on 4th March 2024. 

The changes are:

Expanded role and powers of the Registrar – powers to query and reject filings and remove material. Companies House will therefore be able to:

1. reject or query documents, including requesting supporting evidence if documents are inconsistent with other information held by or available to the Registrar;
2. tackle and remove factually inaccurate information, both unilaterally and following an application by a third party;
3. take active steps to clean up the Register (using data matching tools) and to annotate the Register to highlight discrepancies or inconsistencies to users; and
4. share data with other governmental and law enforcement agencies.

This will apply to information already filed with it as well as before accepting a new filing.

Registered office address must be “appropriate”

Companies must have an “appropriate” registered office address. This means an address where it can be expected that the documents sent to it will come to the attention of the person acting on behalf of the company, and where it can have delivery and receipt acknowledged. Companies will not be able to use a PO Box as their registered office address. 

Companies may continue to use an agent’s address as their registered office address if it meets the above requirements.

Failure to adhere to the “appropriate” office address requirements will lead to Companies House changing a company’s registered address to a default address. Breach of the requirements is a criminal offence by the company and each officer in default.

This change applies immediately as of 4th March 2024.

Requirement for an “appropriate” email address

Companies must have an “appropriate” registered email address. This means an email address which, in the ordinary course of events, correspondence sent to it by Companies House would be expected to come to the attention of a person acting on behalf of the company. The email address will need to be monitored. It may be an individual’s email address and does not need to have a company domain name. It may also be an agent’s email address, provided it meets the requirements above. However, note that given the potential for staff absences and personnel changes, it may be sensible not to tie the email address to a specific individual and instead set up a generic company email address. 

The registered email address will not be part of the public record.

This provision will apply to all new companies incorporated after 4th March 2024 and for all existing companies when filing their next eligible confirmation statement due on or after 5th March 2024.

Breach of this requirement is a criminal offence by the company and each officer in default. New companies will not be able to incorporate without an appropriate email address.

Requirement to confirm a company’s lawful purpose

All companies must confirm on incorporation that they are forming the company for a lawful purpose. This must also be confirmed annually via the confirmation statement that their future activities will be lawful.

Stronger checks on company names

The existing restrictions on company names will be expanded and provisions introduced which will give the registrar greater control over company names. There will be prohibitions on names that are intended to facilitate dishonesty or deception offences, names suggesting a (non-existent) connection with a foreign government or international organisation and names containing computer code. Companies House will have the power to direct a name change and remove a company’s name and replace it with a company number.

Disqualified directors

It will no longer be possible to appoint as a director a person who has been disqualified as a director. An existing director who becomes disqualified will automatically cease to be a director (this was not the case previously under statute, although many company articles of association did contain such a provision).

Considering the changes of 4th March 2024, you should:

1. review all your UK companies’ registered office addresses, ensuring they are all “appropriate” and none are PO Boxes,
2. ensure all your UK companies have a registered email address,
3. review all your UK company names to ensure they do not breach the new restrictions,
4. establish that all persons appointed as directors are eligible to act and are not disqualified under the updated directors’ disqualification regime, and
5. review all your company registers, records, and appointments to prevent Companies House querying the information and annotating your company records on the register.

Fees

Companies House fees increased on 1 May 2024. Fees are set on a cost recovery basis which means that they must cover the cost of the services Companies House delivers. A list of these new fees can be viewed here.