Companies House AML update 2019

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Following on from our previous article on changes at Companies House, we will examine the advice being given out regarding the impact of the Fourth and Fifth Anti-Money Laundering Directive.

The Fourth Anti-Money Laundering Directive, which came into effect in June 2017, contains fundamental changes to the previous procedures relating to identify and prevent AML activity. One of the area’s most relevant to Companies House was article 30, which relates to the identification and recording of beneficial owners.

A UBO register by 2021

At the meeting, it was made very clear that Companies House will be implementing a register for UBOs. Significant progress has been made and ‘a draft bill has been published and we are expecting there to be a Register function in early 2021 which will involve a totally digital process.’ The draft bill ‘Property ownership and public contracting by overseas companies and legal entities: beneficial ownership register‘ is available to download from the UK government website.

The register will show the beneficial owners of overseas entities that own or want to buy property in the UK, and of overseas entities involved in central government contracts. The new register for UBOs will be in addition to the current Person of Significant Control register and information will need to be added to both even if they are the same person or entity. As a formations agent, we would like it to be easy as possible to enter the same information into both the PSC and UBO register. CH was unable at this moment to provide any further details on how the system will work, but we can assume it will be incorporated into the ongoing Companies House reform discussions.

The fifth Anti-Money Laundering Directive

With 5MLD coming into effect from January 2020, the forum discussed some of the key changes that will be implemented immediately. The directive requires obliged entities and competent authorities to report any discrepancies they find between the beneficial ownership (PSC) information available to them and the information available in the Companies House register.

Companies House will investigate and communicate the outcome of any feedback they receive as relating to discrepancies. They are referring to this requirement as Feedback Loops. Further information can be found in the HM Treasury consultation https://www.gov.uk/government/consultations/transposition-of-the-fifth-money-laundering-directive