The UK government is introducing a public register of overseas entities that own residential and commercial property in the UK. It is hoped the register will reduce money laundering practices and encourage transparency.
Entities based outside of the UK that own freehold property or leases of longer than 7 years in England and Wales and/or wish to buy, sell, lease or mortgage such property will have to provide details about the entity’s beneficial owners or controlling individuals, among other things (requirements differ slightly for Scotland and Northern Ireland). The register will be held by Companies House and the information will be publicly accessible.
The new rules will apply to companies that became registered proprietors of land in England and Wales on or after 1 January 1999 and in Scotland on or after 8 December 2014 (subject to a grace period), as well as those acquiring it going forwards.
Subject to the satisfactory information being provided, the overseas entity will be provided with an ID which will be recorded in the register. Without this, a non-UK company cannot register with HM Land Registry as the owner of property in the UK. Consequences for non-compliance include daily fines and imprisonment.
The rules (part of the Economic Crime (Transparency and Enforcement) Bill), in which the register is proposed, are currently before Parliament and are expected to be passed quickly.
If you would like further information regarding the new rules or assistance in ensuring compliance, please get in touch.
Madeleine Rhodes email: MRhodes@redfernlegal.com