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New Identity Verification Regime

March 2023

The Economic Crime and Corporate Transparency Bill is likely to receive Royal Assent in spring 2023. Given the widespread nature and significance of the Bill, it will need secondary legislation and operational changes to Companies House (CH) systems before it comes into force. However, for small private companies there are many important changes coming that they should be aware of and actively preparing for now.

Most significantly the bill will reform Companies House and improve transparency across UK companies (and other legal entities). The reforms include:

  • Introducing identity verification for all new and existing registered company directors, People with Significant Control, and those delivering documents to the Registrar.
  • Broadening the Registrar’s powers so that they can become a more active gatekeeper of company creation and a custodian of more reliable data.
  • Improving the financial information available on all companies on the register.
  • Providing CH with more effective investigation and enforcement powers and introducing better cross checking of data with other public and private sector bodies to enable CH to check, remove and reject information.
  • Enhancing the protection of personal information provided to CH.
  • Broader reforms to clamp down on misuse of corporate entities.

Of most immediate concern to SME private companies will be the new identity verification regime. It will be relevant to all companies (and other entities such as LLPs) and therefore it is important that companies know what is expected and actively prepare for its introduction. 

Considering this, we have this month added some new information pages on the identity verification process and matters that all companies should be thinking about in preparation for this.

This is overview information only and as many of the precise details are still to be confirmed by secondary legislation, it is recommended that companies may wish to seek independent legal advice as to the best route to implement this process for their company. 

The contents of this Newsletter are for reference purposes only and do not constitute legal advice. Independent legal advice should be sought in relation to any specific legal matter.

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