First changes to UK company law due on 4 March

First changes to UK company law due on 4 March

Feb 7, 2024

Companies House will introduce tougher checks on company names and data matching to remove inaccurate information and crack down on abuse of the register

The new rules introduced under the Economic Crime and Corporate Transparency Act will come into effect from 4 March 2024.

Companies House will have greater powers to query information and request supporting evidence, coupled with tougher checks on company names. This means staff will be able to scrutinise and reject information that seems incorrect or inconsistent with information already on the register. In some cases, this will lead to the removal of information.

In a bid to improve the quality of the company register, Companies House staff will also start using data matching to identify and remove inaccurate information.

As part of the wider crackdown on illegal companies and to improve transparency, for the first time data will be shared with other government departments and law enforcement agencies.

There will also be new rules for registered office addresses and a requirement for all companies to supply a registered email address. Existing companies will need to give a registered email address when they file their next confirmation statement effective from 5 March 2024.

From 4 March 2024, companies must have an ‘appropriate address’ as their registered office at all times. An appropriate address is one where:

  • any documents sent to the registered office should be expected to come to the attention of a person acting on behalf of the company; and
  • any documents sent to that address can be recorded by an acknowledgement of delivery.

These changes mean companies will not be able to use a PO Box as a registered office address, but a third-party agent’s address can be used if they meet the conditions for an appropriate address.

Any company currently using a PO Box as a registered office address will need to change it by 4 March 2024.

Companies that do not have an appropriate registered office address could be struck off the register and will have 28 days to advise they are complying with the new rules.

Another change will be a requirement for all companies to confirm they are forming the company for a lawful purpose when they incorporate, and to confirm its intended future activities will be lawful on their confirmation statement.

Companies House will also have the power to annotate the register when information appears confusing or misleading.

Louise Smyth, chief executive of Companies House said: ‘This landmark legislation introduces a series of positive changes that will not only strengthen our powers, but also contribute to a fairer and more transparent business environment. It will mean real improvements for the UK economy, for businesses, and for individuals.

‘These early changes will not necessarily stop fraudulent information being accepted and published on the register. We know there’s more to do. We’re working towards additional changes, such as identity verification, which will come in later.

‘We’re also already acting behind the scenes to disrupt crime through our intelligence functions and will soon be able to help victims of fraud in new ways.’

There are a number of other changes in the pipeline, including identity verification, streamlining accounts filing options for small and micro entity companies, and transitioning towards filing accounts by software only. A timetable for their introduction has not been confirmed.

The introduction of the initial changes to Companies House reporting needs secondary legislation so this date is still dependent on parliamentary timetables. It will not be earlier than 4 March.