EU Changes to Persons with Significant Control Regime
The Fourth Money Laundering Directive ((EU) 2015/849) (“MLD4″) must be transposed into national law by 26 June 2017. MLD4 requires (amongst other things) corporate and other legal entities to disclose their beneficial owners. In many respects this is currently being done under the PSC regime. However, MLD4 goes further than the PSC regime in two important regards and, as a consequence, changes will need to be made to the PSC regime.
MLD4 requires the beneficial ownership information to be “current”. However, at present, any changes to the PSC register are notified on the annual confirmation statement, meaning the information open to public scrutiny could potentially be close on a year out of date. For that reason, Companies House has announced that as from 26 June the PSC register will no longer be updated on the confirmation statement (form CS01). Instead, companies will need to update their register within 14 days of the change and file a form PSC01 to PSC09 within another 14 days. This is a significant change and is strictly event-driven.
The second difference is that MLD4 has a wider scope of application, meaning that the PSC regime will need to be extended to include more entities. Affected entities are Scottish Limited Partnerships and General Scottish Partnerships, in both cases from 24 July 2017 (although strangely it appears from Companies House announcement that they can continue to update their PSC information yearly on a confirmation statement).
Other possible affected entities are so called DTR5 companies i.e those listed on AIM and NEX (formerly ISDX). Such companies are currently not caught by the PSC regime, but that could change. Clarification is required but, as a result of the snap general election being called, government has gone into purdah. No regulations have yet been published and parliamentary time will be in short supply after the result is called, meaning that the timetable could be delayed. However, Companies House has said that until it hears otherwise, it is currently working to the original timetable.