Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he plans to take to ensure UK entities cannot be used as shell companies for money laundering in light of recent allegations against prominent Azerbaijanis.
Answered by Margot James
The UK has implemented a series of reforms since 2015 aimed at increasing the transparency of UK incorporated legal persons and arrangements, and preventing their misuse for illicit purposes. These reforms include, but are not limited to, the introduction of the publicly accessible People with Significant Control Register; the abolition of bearer shares; the introduction of a register of trusts with tax generating consequences; the introduction of Unexplained Wealth Orders; and the introduction of the HMRC register of Trust or Company Service Providers. It is too early to measure the impact of many of these reforms, but we expect these measures to make a significant difference to the prevention of the misuse of companies and trusts, and assist law enforcement in their investigations where misuse does occur.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, when his Department plans to publish its response to the consultation on Overseas companies and other legal entities beneficial ownership register.
Answered by Margot James
The responses to the call for evidence are currently being analysed and a response will be published in due course.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what progress his Department has made on developing a public register of UK property ownership.
Answered by Margot James
At the International Anti-Corruption Summit in London on 12 May, the previous Prime Minister announced that the Government will require overseas companies that own or purchase UK properties or bid on UK Government procurement contracts to provide details of their beneficial owners to a public central register.
This will be the first register of its kind in the world and the Department for Business, Energy and Industrial Strategy (BEIS) has been working with the devolved administrations, delivery partners and other experts to develop this novel and complex policy that will have to operate effectively across UK and international company law, and within the three different land registration regimes of the UK. BEIS intends to publish a call for evidence seeking views on the policy in the coming months.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the register of persons with significant control, what proportion of returns from companies have listed another company rather than an individual as the persons with significant control.
Answered by Margot James
As at 10 October 2016, the number of accepted filings from companies that have listed another company, rather than an individual as the people with significant control (PSC) is 66,304, equating to 8.4% of the 785,616 total number of accepted filings from companies that have listed PSC details.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make arrangements for companies in the register of persons with significant control to be identified by name.
Answered by Margot James
It is a requirement for companies in the register of people with significant control (PSC) to be identified by name.
Where a company is owned and controlled by a legal entity such as another company, if that legal entity is both registrable and relevant in relation to the company then the company must enter a set of required particulars in its PSC register and provide that information to Companies House. One of the required particulars is the corporate or firm name of the legal entity that owns and controls the company.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department is taking against companies which circumvent the requirement for businesses to disclose information to Companies House on persons with significant control in that company by registering another company rather than an individual as the person with significant control of that company.
Answered by Margot James
The Small Business, Enterprise and Employment Act 2015 (the Act) established rules governing what a company must enter in its register of people with significant control (PSC) and what it must file with Companies House. Companies can legitimately register a company as their PSC if that company meets the conditions of control, is the first legal entity in a company’s ownership chain and they are subject to their own disclosure requirements. (A full explanation of the rules can be found in BEIS guidance.)
It is an offence for anyone knowingly or recklessly to deliver a document or statement to Companies House that is misleading, false or deceptive in a material way. A person guilty of an offence under this section is liable to imprisonment, to a term not exceeding two years, or a fine, or both.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, how his Department is (a) monitoring and (b) enforcing the requirement for companies to disclose information on persons with significant control in their company as part of their company register in Companies House.
Answered by Margot James
Companies disclose information on people with significant control (PSCs) through the requirement to file a Confirmation Statement at least once a year, confirming its information, including PSC data, is correct. Companies House helps companies comply with these requirements by issuing guidance and also reminders to all companies to help them file on time. Filings are not accepted unless the information is complete, so Confirmation Statements must include information on PSCs. Where companies have not filed a Confirmation Statement, Companies House contacts companies seeking compliance and reminding them that they have committed an offence.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the register of persons with significant control, how many companies have registered a shell company in an offshore tax haven as the persons with significant control of that company since 6 April 2016.
Answered by Margot James
Companies House does not hold figures on the number of companies that have registered a shell company in an offshore tax haven as their PSC. Companies can legitimately register a company as their PSC if that company meets the conditions of control, is the first legal entity in a company’s ownership chain and they are subject to their own disclosure requirements.
A full explanation of the rules can be found in BEIS guidance.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department takes when the register of persons with significant control reveals a criminal record.
Answered by Margot James
The register of PSC would not reveal a criminal record as it is not something that PSC are required to declare.
Asked by: Margaret Hodge (Labour - Barking)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, how many companies have listed another company rather than an individual as the persons with significant control in that company as part of their company register since 6 April 2016.
Answered by Margot James
The number of companies that have listed another company, rather than an individual, as a person with significant control (PSC) for the period 6 April to 10 October is 64,964. A company can list more than one PSC. Therefore, the figure of 64,964 includes companies that have listed both an individual and another company as their PSC.