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Company Legislation - The Register of People with Significant Control



Company Legislation - The Register of People with Significant Control

The Small Business and Employment Act, 2015, introduced a new requirement for companies to keep a Register of People with Significant Control. Intended to increase transparency and mitigate concerns about the complex nature of many corporate organisations, even the smallest limited companies have to comply with the new legislation.

A Register of People with Significant Control, or PSC Register, identifies individuals and other companies who hold considerable influence within a business. Issues caused by the commonly complex structure of large organisations came under discussion at the 2013 G8 Summit, and resulted in the register being introduced as part of the measures to increase transparency.

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Criteria for identifying PSCs

From 6th April 2016, identifying and making clear who holds significant control within a company is obligatory, and all company directors have to take reasonable steps to this end. Non-compliance brings with it severe penalties, so here are the criteria that will help you identify the necessary people and entities.

A person with significant control will, either directly or indirectly:

  • Hold more than 25% of shares
  • Hold more than 25% of voting rights within a company
  • Have the right to appoint or remove the majority of directors from the board
  • Have the right to exercise ‘significant influence or control’ within the business
  • Have the right to exercise ‘significant influence or control’ over a trust or non-legal entity, whose trustees or members can be identified by any of the preceding criteria

What do you need to do in practice?

You have to ‘take reasonable steps to identify’ people with significant control, and maintain a register of their details. From April 2016 the PSC Register must contain some information and should not be left blank, even if you only document the steps you are taking to comply.

This requirement is ongoing, and from June 2016 the information should be sent on an annual basis to Companies House, along with a confirmation statement. Failing to comply is a criminal offence and could result in severe financial penalties, or even a prison sentence.

You need to notify the people you believe could qualify as PSCs, and request their confirmation. If they fail to respond, you have the power to apply sanctions. Notices should also be sent to anyone you think is aware of someone holding significant control.

The obligation is on individuals to proactively provide information, and these people are also open to criminal action if they don’t respond.

What information is needed?

In the case of an individual you need to include their:

  • Name
  • Date of birth
  • Nationality
  • Service address
  • Usual country of residence
  • Usual residential address (doesn’t appear on the register)
  • Nature of their control, and the date it started

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For a relevant legal entity (RLE):

  • Company name
  • Company number
  • Registered address
  • Legal form
  • Nature of their control, and the date it started

Real Business Rescue is here to help. We can guide you on how to set up your register, and ensure that you comply with all the requirements. Call today for a free confidential meeting. 

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