Giorgio Pizzetti outlines how companies can prepare for ECCTA in the FT Adviser

Giorgio’s article was published in the FT Adviser, 17 April 2024, and can be seen here.

Giorgio Pizzetti, Associate in our Corporate & Commercial department, outlines the significant changes introduced by the Economic Crime and Corporate Transparency Act 2023 (ECCTA), which aims to combat economic crime, enhance transparency, and improve the reliability of information held at Companies House.

The Act marks a major shift in corporate regulation, granting Companies House new powers to query, reject, and annotate company filings powers that came into effect from 4 March 2024. Previously, Companies House had to accept filings at face value if they were “properly delivered,” even if they were suspicious or incorrect.

Giorgio explains that the ECCTA introduces new obligations for companies, LLPs, and their directors. These include the requirement to provide a registered email address, a ban on using PO Boxes as registered offices, and a declaration that the company is being formed for lawful purposes. While these may seem minor, they are only the beginning of a broader transformation in how companies interact with Companies House. Businesses are urged to review the accuracy of their filings and consult advisers to ensure compliance, as failure to do so could result in reputational damage or even removal from the register.

The article also highlights practical steps companies should take now. For example, registered email addresses should not be tied to individual employees to avoid disruption if they leave. Companies using PO Boxes must urgently update their registered office address or risk being struck off. These changes are enforceable, and Companies House has the authority to assign a default address and initiate strike-off procedures if companies fail to comply within 28 days.

Looking ahead, the ECCTA will introduce further verification requirements and potential criminal or civil penalties for non-compliance. While some have raised concerns about the administrative burden, the overarching goal is to create a more transparent and trustworthy corporate environment. Giorgio advises companies to treat this as an opportunity for a governance “spring clean” and to stay closely connected with professional advisers as secondary legislation and further guidance are expected.

Read the full article on the FT Adviser website [subscription required].