Corporate Transparency and Reform of the Companies Register

(Limited Text - Ministerial Extracts only)

Monday 21st September 2020 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

My right hon. Friend the Parliamentary Under-Secretary of State (Minister for Climate Change and Corporate Responsibility) Lord Callanan has today made the following statement:

The Government published its response to the 2019 consultation on options to enhance the role of Companies House and increase the transparency of companies and other legal entities on Friday 18 August. The consultation received over 1300 responses from all across business, academia and civil society and I am grateful to all those that took the time to submit their views.

The response outlines the Government intention to take forward many of the measures proposed in the consultation. Our vision is for a company register built upon relevant and accurate information that supports the UK’s global reputation as a leading exponent of greater corporate transparency. Companies House will play an even stronger role as an enabler of economic growth, whilst strengthening the UK’s ability to combat economic crime.

These reforms will support the Government ambition of making the UK the best place in the world to start and grow a business. Businesses will benefit from more reliable information, streamlined and digitised processes and an improved user experience, reflecting the needs of business in the 21st century.

The key measures are:

Identity verification. We will introduce compulsory identity verification for all directors and beneficial owners—people with significant control—and individuals filing information on behalf of a company.

Reforms to Companies House powers. We propose giving the registrar much stronger powers to query, seek evidence for, amend or remove information and to share it with law enforcement partners when certain conditions are met.

Protecting personal information. We will give individuals more rights to remove personal information from the register, to help protect them from fraud and other harms.

Company accounts. We propose mandating electronic filing to bring the UK in line with international best practice and will look to simplify the filing of accounts with Companies House and HMRC. We propose a further consultation on options to deliver these reforms. These reforms will have a negligible impact on the speed at which incorporation and other filings are completed: we still expect the vast majority of companies to be able to incorporate easily within 24 hours. Costs will remain low by international standards. Where more information is being sought from companies, for example for identity verification, technological solutions will ensure that additional burdens on business and individuals are kept to a minimum.

The Government will consult on further reforms to make Companies House data more useful and usable, including reforms to the filing of company accounts and the registrar’s powers. Once the detail of all the proposals has been settled, the Government will bring forward legislation to implement the reforms when Parliamentary time allows.

[HCWS459]