A company is required to inform Companies House of important changes that happen including:

• The appointment and resignation of directors and company secretaries
• Changes to the company name
• Changes to the registered office address
• Changes to the accounting reference date
• Issuing new shares and other changes to the share structure
• Details of any new mortgages or mortgages being paid off

In addition, your company is required to make annual filings such as the filing of accounts and confirmation statements. If you do not comply with these rules, then you could be fined, or your company could be struck off the register of companies.

Persons with significant control

A fairly recent change in the law and filing requirements of a company, is that from April 2016, UK companies and LLP’s must inform Companies House of the people who have significant control of that company and must also keep a register of those persons with significant control.

When you incorporate your company, you will need to provide information on people with significant control upon registration. At this time, you should also create your own register of people with significant control.  You will need to amend the register if this changes and you will also need to update Companies House at the same time.

Who is a PSC?

A person with significant control (PSC) is someone who owns or can exercise significant influence over a company. It is possible that a company can have multiple PSC’s.

To be a person with significant control, the person must meet one or more conditions known as the ‘nature of control’.

PSC’s are those who hold:

• More than 25% of shares in the company
• More than 25% of voting rights in the company
• The right to appoint or remove the majority of the board of directors

There are two other types of possible PSC’s:

• Other significant influence or control - A PSC can have other means of influencing or controlling your company. It is also possible that a third party can control directors or shareholders through other means. These must also be recorded.
• A trust or firm without ‘legal personality’ - A trust or firm may have been set up which has a nature of control over your company. If this is the case, you will need to record all trustees or members/partners of the firm as PSC’s and also register this information at Companies House.

Where to find information on who is a PSC?

A company needs to create a Register of Members which will contain details of all the shareholders and the number of shares that they hold. In addition, a company may also have provisions set out in a shareholder’s agreement or articles of association which contain provisions on who has the right to appoint and remove directors and who has the voting rights in a company.

Obtaining information from PSC’s

If you think your company has a PSC, but you do not have all their information, you can send the PSC a notice. You can also write to the PSC’s advisers such as lawyers and accountants. It is important to identify and record for PSC.

If the PSC does not respond within one calendar month, or provides you with false information, they are committing a criminal offence and could receive a 2 year prison sentence, a fine or both.

If a PSC repeatedly refuses to provide information you can apply to have a restriction placed on their shares or voting rights.

What are the director’s obligations?

An officer of the company is required to:

• Identify the people with significant control over the company and confirm their information
• Record the details of the PSC on the company’s PSC Register within 14 days
• Provide the PSC information to Companies House within a further 14 days
• Update the information on the company’s PSC Register when it changes within 14 days
• Update the information at Companies House within a further 14 days
• Confirm to Companies House that information on the public register is accurate, where it has not been updated in the previous 12 months

What information do you need to record in your PSC Register?

Your PSC Register must include the following details:

• Name
• Date of birth
• Nationality and country of residence
• Correspondence address - known as the ‘service address’
• Home address (this must not be disclosed)
• The date they became a PSC of the company
• The date you entered them into your PSC register
• All natures of control which apply

You need to check that all these details are correct with your PSC.

In addition, you will also need to include in the PSC Register the PSC’s level of their shares and voting rights as follows:

• Over 25% up to (and including) 50%
• More than 50% and less than 75%
• 75% or more

If you are not able to obtain all this information, you must record a statement in your PSC Register saying why you do not have this information.  You cannot have a blank PSC register.

Changes to the PSC

You need to make sure that you change your PSC Register within 14 days and inform Companies House within a further 14 days of any changes.

Inspection of your PSC Register

You must keep your PSC Register open for inspection at your company’s registered office.  Anyone can inspect your PSC Register free of charge and you can charge them up to £12 for a copy.

Keeping your PSC Register at Companies House

You can elect to keep your PSC Register at Companies House provided that you have given your PSC’s 14 days’ notice (and you have not received any objections to this from your PSC’s in this period). This will mean that most of the PSC information will be available to the general public other than the PSC home address (unless it is also a service address).

What happens if your company fails to comply with the PSC rules?

It is a criminal offence for a company to fail to provide accurate PSC information which could result in a fine and or a prison sentence of up to two years.

Conclusion

It is important to maintain and keep up to date all of your company registers and information at Companies House. If you are unsure of your obligations and requirements, need help in assessing who are your company’s PSC’s or need help in creating a PSC register, please do not hesitate to contact LawBite and one of our experienced corporate lawyers.

About the author

Annelie Carver is a solicitor qualified in England with over 19 years’ experience in advising a wide range of businesses from startups to full list public listed companies.