GOV.UK provides detailed PSC guidance for each type of business entity. If a legal entity in your organization is owned or controlled, you must determine whether it is considered a registrable relevant legal entity with respect to your organization. UK companies may find that the information they need to comply may not be available; As a result, companies have been given extensive information powers and restrictions may be imposed on shares if the information is not provided. A company has the authority to notify a person it knows or has reason to believe that the person knows the identity of the PSC or LRA in question or knows another person who may have such knowledge. If the Company is unable to obtain the information it needs, it may, after issuing a “warning notice” followed by a “restriction notice”, take steps to impose restrictions on the actions of the person who has not complied with the inquiries, which may include prohibitions on exercising rights, transfer shares, issue additional shares or pay dividends. The PSC scheme came into force on 6 April 2016, so all UK unlisted companies and LLPs should already have a PSC register. However, following the implementation of the 2017 regulation, there are stricter update and notification requirements. Companies must now update their MFF information in the central register within 14 days of updating their own register. Changes to an entity`s own registry must be made 14 days after confirmation of the change in question (for private security companies) or 14 days from the date the entity receives the details of the change (for LANs). The CFP3 Regulations also bring legal entities (including foreign-incorporated entities) whose voting shares are admitted to trading on certain markets in the United States, Japan, Switzerland and Israel under the definition of ELA. As a general rule, therefore, unlisted companies established abroad would not be LEIs on that basis.
From 6 April 2016, UK companies and LLPs will have to keep a publicly accessible register of persons with significant control. UK firms and LLPs must take “reasonable steps” to obtain the necessary information about their CSP and, where appropriate, issue opinions to confirm the identity of their PSCs. To facilitate compliance with the new regulations under the SBEE, UK companies have broad powers to impose restrictions on the shares held by the person who has failed to comply with PSC requests for information, which may include prohibitions on exercising rights, issuing more shares or paying dividends. Failure to comply with obligations under the SBEE Act is also a criminal offence, up to and including imprisonment and/or a fine. Once identified, a relevant legal entity is registrable in relation to a company if it is the first ELA in the company`s chain of ownership – that is, it has no indirect interests in the business through one or more other LEIs. The consumer protection regime applies to all UK companies, with the exception of listed companies, which are exempted as they are already subject to transparency obligations under the disclosure and transparency rules of the FCA (or its foreign equivalent). In this context, “listing” refers only to companies listed on the official list and those whose voting shares are admitted to trading on a regulated market in another EEA State or on certain markets in the United States, Japan, Switzerland or Israel. Since the entry into force of the 2017 regulation on June 26, 2017, the exemption no longer applies to companies listed on markets such as AIM or NEX Exchange Growth Market, and these companies will therefore have to keep a PSC register from July 24. The CSP register must also contain information on a “relevant legal entity” that is registrable (ELA).
A legal entity is relevant if it meets one or more of the five public security conditions mentioned above and: In scenario 2, it was assumed that Company C is a UK company subject to the CSP regime, i.e. it would be a registrable ELA for Company A. Therefore, although P3 is a PSC of Company A, it is not registrable for Company A because it holds its interest indirectly through a registrable ELA. However, it will be possible to meet the definition of majority shareholding with less than 50% if the shareholder concerned exercises or is entitled to exercise a dominant influence over the affairs of the company concerned. A PSC is by definition an individual, but UK companies (and foreign companies listed in the UK or certain foreign markets) may also be listed on the PSC register if they are both `relevant` (i.e. they meet the criteria of a relevant legal entity (or LEI) and `registrable` (see below).
