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Economic Crime and Corporate Transparency Act 2023
- Posted
- AuthorLauren McCarthy
The Economic Crime and Corporate Transparency Act 2023 (ECCTA) amends the Companies Act 2006 by introducing new requirements for the registration and maintenance of companies in England and Wales with the intention of tackling economic crime and improvement of corporate transparency.
Having received Royal Asset in October 2023, the ECCTA will be implemented through secondary legislation, which is yet to be published.
Objectives of ECCTA
The ECCTA aims to prevent organised criminals and fraudsters from using companies as a vehicle to abuse the UK’s open economy, strengthen the UK’s response to economic crime and support Companies House to improve the reliability and transparency of corporate data.
Key Measures Implemented by ECCTA
To achieve these aims, the Act implements various new measures which include:
Companies House Reforms
Verification identity for all new and existing registered company directors, People with Significant Control and those delivering documents to the Registrar. Directors and PSCs who do not verify their ID will commit a criminal offence
The ECCTA makes electronic filing compulsory
Strengthening the Registrar’s powers to verify and decline data submitted to it or already on the register
Improving financial information and data held on the register to increase transparency and reliability of corporate data
Providing Companies House with more effective enforcement and investigatory powers to enable cross-checking of data with law enforcement bodies if there are suspicious or anomalous filings on the register
Increasing the protection of personal information provided to Companies House to reduce the risks of fraud
Overseas entities that own UK property must apply for registration at Companies House and provide information about their beneficial owners
Limited Partnership Reforms
Tightening registration requirements for LPs
Requires LPs to maintain a connection to the UK
The Registrar will be able to de-register LPs which are dissolved or no longer carrying on business
Anti-Money Laundering Powers
Companies will be required to record in the register of members both individuals’ member forename and surname and service address
New corporate offence for failing to prevent fraud, which extends liability to an organisation if an associated person commits a specified offence for the organisation’s benefit unless the organisation can show it had reasonable fraud prevention procedures in place
If you have any questions about how the Economic Crime and Corporate Transparency Act may affect you or your business, please get in touch. I can be contacted on lauren.mccarthy@birkettlong.co.uk, or call on 01206 217371.
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