The (excitingly titled) Small Business, Enterprise and Employment Bill is now before Parliament and the Government's expectation is that this will pass into UK law before next year's general election.
Most of the publicity in the national press and media (all of it I think?) has been about the newly created Pubs Code Adjudicator and the Pubs Code, but for accountants some changes can be found which we have been anticipating for some time.
I simply must reproduce the introductory paragraph to the Bill which has to be read to be believed (but ignore it if you wish!)!
A B I L L TO
Make provision about improved access to finance for businesses and
individuals; to make provision about regulatory provisions relating to
business and certain voluntary and community bodies; to make provision
about the exercise of procurement functions by certain public authorities; to
make provision for the creation of a Pubs Code and Adjudicator for the
regulation of dealings by pub-owning businesses with their tied pub tenants;
to make provision about the regulation of the provision of childcare; to make
provision about information relating to the evaluation of education; to make
provision about the regulation of companies; to make provision about
company filing requirements; to make provision about the disqualification
from appointments relating to companies; to make provision about
insolvency; to make provision about the law relating to employment; and for
Being 221 pages long the Bill contains much detail, but we should particularly note two provisions which clients will need to be aware of and will have to comply with:
Register of PSCs
All UK companies (other than publicly traded companies) will need to maintain a register of what are being described as PSCs (People with Significant Control). Companies will be required to take reasonable steps to identify every individual who has, directly or indirectly, significant control over the company. Government has promised that guidance will be issued clarifying the meaning of the term, but significant control will apparently mean more than 25% of shares or voting rights, or anyone who otherwise exercises control over the company or its management.
This register will be available for public inspection at the registered office. Applicants to inspect the register must give a reason for their request and the company could make an application to the court to deny access if the request is 'not for a proper purpose'.
The register will certainly be helpful to practitioners given their need to know the identity of Beneficial Owners under the Money Laundering Regulations, and in any case the anticipated revised EU Money Laundering Directive will require such a register! Probably a very desirable change but not exactly 'cutting red tape'!
The confirmation statement will in effect replace the Annual Return and is intended to cut the red tape involved in filing the Annual Return. Theoretically the existing Annual Return should be redundant if (?) all and any changes during the period have been notified to Companies House as required by the Companies Act.
Essentially it will be a statement that since the previous confirmation statement, the company has notified Companies House of any changes to details of its registered office, directors, company secretaries and people with significant control ('PSC') and of where a company keeps its registers (if not at its registered office).
The company will be allowed to make this statement whenever they wish, but at least every 12 months.
It is also intended that private companies will be allowed to opt out of keeping a register of members/shareholders, directors, directors' residential addresses, secretaries and the PSC register and instead will be able to rely on the register kept by Companies House. This is more flexible than the current system and may reduce red tape at least a little.