British Companies are asked to change Directors and to disclose information about persons in control of the company

30.06.2014

British Government published the Bill changing the corporate legislation in the country.

Amendments made to the Companies Act 2006 create new register of persons which have substantial control over the company. Companies shall submit to the register information on all persons, which can affect the decision-making process within the company and have an impact on the way the company is making business. In particular, new register of people with significant control will contain information on natural persons, which hold more than 25% of company’s shares or of voting rights, or expressing their control in any other manner.

Also amongst the amendments to the Companies Act 2006 there is a provision on director of the company can be no other person than the natural person. If the director of the company is not a natural person, the company has 12 months from the date the Bill enters into force in order to comply with this provision.

Source: http://www.publications.parliament.uk/pa/bills/cbill/2014-2015/0011/15011.pdf

Expert’s opinion

here were rumors on information on beneficiaries of the British companies to go public since November, 2013 (http://hbcomp.ru/about/news_and_mailings/news_jurisdictions/3809/?sphrase_id=1083). But British authorities consider something else as “to go public”. The Bill explains that companies should collect information on persons, who affect its management. Nonetheless, even this information will not be open and will be disclosed under the court’s decision only. As it turns out, the devil is not so black as he is painted.

As to the changes in the corporate structure: Great Britain is basically the “fashion queen” in this sphere. First of all it was Great Britain, that brought in the rule of the company’s director being at least one natural person. Hong Kong is following the rule this year enforcing it into law provisions. (http://hbcomp.ru/about/news_and_mailings/news_jurisdictions/3896/). Today Great Britain’s authorities decided to go even further by exempting from the corporate structure of British companies legal persons. I think, that after these provisions will enter into force there will be some complications in connection with transfer period, “restructuring” of corporate structure, but it shall not affect the attractiveness of Great Britain as jurisdiction for doing and structuring successful business.

Alexandra Mihno ( Lawyer, Honest&Bright)