New powers for Companies House explained
For a long time and despite the comprehensive Companies Act 2006 with its mere 1300 sections, substantial criticisms have been made as to the various porous aspects of UK Company law, and the abiding sense that Companies House is too passive and toothless to combat the large scale of information that is fraudulent, inaccurate or simply outdated.
This has played its part in the United Kingdom, traditionally revered for its principles of good faith, the rule of law and transparency, tumbling to 18th in the world according to Transparency International’s most recent Corruption Perceptions Index (2022). London has often been labelled the “money laundering capital of the world”, foreign companies and individuals have deliberately created complicated webs of UK companies to prevent the identities of owners from being discovered, avoid taxation and to hide assets.
To combat these long-recognised issues, as part of a phased introduction of new measures to tackle the ills of fraud, money laundering and other means of economic crime, the following are now in place, supported by civil and criminal penalties:-
- Greater powers to query information and request supporting evidence;
- Stronger checks on company names;
- All companies must have an appropriate address and will not be able to use a PO Box as their registered office address;
- All companies must supply a registered email address;
- Subscribers will have to confirm they are forming a company for a lawful purpose at the point of incorporation, and for a company to confirm that its intended future activities will be lawful on its confirmation statement;
- Greater powers to tackle and remove factually inaccurate information; and
- The ability to share data with other government departments and law enforcement agencies.
The scope of the above gives Companies House greater powers to be more proactive and inquisitive, albeit the details of how this will work in practice are limited at this early stage.
The Government factsheet stresses the desire for Companies House to be more of an “active gatekeeper” and “custodian of reliable data”. Future plans are in the pipeline to reform current standards as to company accounts, crypto assets and money-laundering, in addition to further measures to tackle fraud.
Dispute Resolution Associate Abeer Sharma says “In theory, this sets the ground for Companies House to become a different beast to what it has been in its 180-year history. The practical impact on businesses and individuals will only be discovered in the years to come, but I suspect that much will rest on whether Companies House, unlike the court system and other government bodies such as HM Land Registry, will be sufficiently staffed to enable the organisation to enforce the additional responsibility and powers bestowed on it by these new measures.”
How can our dispute resolution lawyers help?
At Hanne & Co, we deliver practical and cost-effective advice to businesses and individuals. We are proud of our ability to provide quality advice tailored to each client’s individual objectives and boast a high rate of success in achieving results for our clients. Should you have any queries about any of the above, please do get in touch on +44 (0) 207 228 0017 or via the form below and we will be happy to assist.
If you have a query for our dispute resolution team, contact one of our lawyers by filling out the form below or call us on +44 (0) 207 228 0017.
"*" indicates required fields
