New transparency rules to keep companies squeaky clean

Company directors, people with significant control of a company, or anyone who files on behalf of a company, must ensure they comply with new transparency rules from March 2024.

Greater scrutiny of information lies at the heart of the new legislation, which is designed to plug potential loopholes that may have been exploited for the purposes of economic crime. It strengthens the powers of law enforcement agencies, makes it easier to prosecute corporates for certain financial crimes, and introduces a new offence of 'failure to prevent fraud' for larger organisations.

Called the Economic Crime and Corporate Transparency Act 2023, the Act amends the Companies Act 2006. It means that from March 2024, UK-registered companies will face stronger checks on company names, new rules for registered office addresses, and a requirement to confirm activities are lawful on incorporation and each year after.

Companies House will have greater powers to challenge information provided and will use data matching to identify and remove inaccurate information from the register.

Said corporate expert Joseph Long of Nicholsons Solicitors: "The changes affect companies across the board, and directors will need to keep an eye out to be sure they are complying from March 2024 onwards."

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This is not legal advice; it is intended to provide information of general interest about current legal issues.