The UK Government has published a discussion paper entitled “Transparency & Trust: Enhancing the transparency of UK company ownership and increasing trust in UK business.”
At the heart of this paper is the desire to enhance the powers of tax and law enforcement authorities to identify beneficial ownership in order to combat those who hide behind legal entities to evade tax or commit wider criminality (e.g. money laundering).
The UK Government is proposing to introduce a new central register of beneficial ownership at Companies House requiring companies to declare who owns and controls them. All UK Companies will be in scope (and potentially Limited Liability Partnerships and other entities), but the UK Government is considering an exemption for companies listed on the Main Market of the London Stock Exchange. The proposed definition of “beneficial owner“ is any individual with an interest of more than 25% of the shares or voting rights of the company; or who otherwise exercises control over the way the company is run.
The paper makes it clear that where a number of individuals collectively own more than 25% and agree to vote as a “block” they would be treated as one and their interest in the company should be disclosed. The control point would also bring in “shadow directors”. The Government will not require companies to provide details of who is the beneficial owner of every share.
Other areas of consultation where comments are requested include:
The consultation is open until 16th September.