13 April, 2018
In May 2016, the Government announced its intention to introduce a register of beneficial owners of overseas companies owning property in the UK. Following a consultation on proposals, the Government has responded on how it intends to implement the register in light of the responses received.
The Government's initial proposal was to establish a new regime which would apply to all overseas legal entities that hold property in the UK. The new register would resemble the UK Persons of Significant Control (PSC) regime, which shows the identity of beneficial owners of limited companies, as well as the reasonable steps an entity should take and the information that should appear on the register.
In particular, the new register would require overseas entities to:
The Government's Response Post-Consultation
Following consideration of the responses received, the Government has set out how it plans to implement the register.
The key requirements of the new register include:
The Government intends to publish a draft Bill creating the new register during the course of 2018 with a view to have the register operational by 2021.
With further details to be confirmed in the draft Bill, at this stage it is clear that overseas entities will need to keep up to date with the latest developments to ensure that they have the relevant information available for new purchasers or updating existing titles. As the new regime is targeted at all registerable land, establishing or maintaining legal title will require information regarding beneficial ownership information to be available in the prescribed form. This is important from a governance perspective, as well as enabling an entity to utilise its assets through charging for example. Additionally, maintaining updates as required by the upcoming legislation will also be important to ensure that the entity can deal with the asset as it chooses, as well as to avoid committing a criminal offence.
We will be providing further detail on these changes once the draft legislation is published. In the meantime, if you have any questions regarding these changes please contact our Corporate or Commercial Property teams on 0333 207 1130.