What the UK Government has confirmed so far
In their update on the implementation of the Register, published on 27 April 2022, Companies House confirmed:
- overseas entities that own land in the United Kingdom:
- will be required to declare their beneficial owners or managing officers; and
- will not be able to buy, sell, transfer or lease land, or create a charge against the land in the UK, unless they’ve registered with Companies House;
- a grace period of six months, from the launch of the Register, for overseas entities who already own land in the UK to register their beneficial owners or managing officers;
- new overseas purchasers will need to register with Companies House from the day the Register comes into effect;
- once registered, "Overseas Entity IDs" will be provided by Companies House and the name of the overseas entity and its beneficial owners will be publicly available on Companies House;
- Overseas Entity IDs will be required to be shared with the relevant land registry (depending on where the land is situated in the UK) whenever the overseas entity buys, sells, transfers, leases or charges land in the UK;
- the information shared with the land registry will be required to be updated every year; and
- severe sanctions – such as daily fines and prohibitions on the ability to transact with their land – will be imposed on overseas entities which do not register.
The registration requirements will apply to land bought since January 1999 in England and Wales, since December 2014 in Scotland, and to land bought from the day the Act comes into force in Northern Ireland. Companies incorporated in the Republic of Ireland fall under the definition of an overseas entity.
Whats Next?
In his statement to Parliament, "Update on the Implementation of the Register of Overseas Entities", made on 26 April 2022, the Parliamentary Under Secretary of State (Minister for Climate Change and Corporate Responsibility) confirmed that the UK Government has been working at pace to ensure the Register is in place as soon as reasonably practicable.
According to the Minister, there are two aspects to this – the technical development of the Register itself and the establishment of the appropriate legal framework through secondary legislation. Both Companies House and the Minister’s statement confirm that an Implementation Group comprising officials from the Department for Business, Energy and Industrial Strategy, Companies House and the UK Land Registries has been established and is driving forward delivery across both aspects.
A number of important aspects of the Register need to be defined through secondary legislation before the launch date of the Register can be confirmed. These aspects include technical details of verification requirements (to ensure the Register is sufficiently robust); the protection regime for beneficial owners and managing officers that wish to have their details protected from public disclosure (due to a risk of serious harm or violence); and mandating the digital delivery of information to Companies House.
Companies House confirmed that they will soon be writing to all overseas entities captured by the Act who own land in England, Wales and Scotland to make sure they know about their new responsibilities. They also plan to publish detailed guidance on GOV.UK after the secondary legislation is laid.
We will follow up with a comprehensive summary of any proposed secondary legislation once further information is published by Parliament or the UK Government. In the meantime, Hogan Lovells is available to assist you prepare your registration and ensure compliance with the new Register.
Authored by Ashley Florestal and Claire Lipworth.
