Measures to boost transparency in respect of company ownership require ‘significant clarification’ before coming into force next year, the Law Society has told MPs.
Under proposals published by the government in June, incorporated private companies will need to keep an up-to-date register of people with ‘significant control’ (PSC) (25% or more) and serve notices on anyone who may know someone who might be a PSC.
The Law Society’s Company Law Committee gave evidence to the House of Commons on the proposals for a register of PSCs last week.
The Society said that while it welcomes measures for greater ownership transparency, the proposals could put the UK at a competitive disadvantage against jurisdictions that have not introduced similar measures.
In a statement it said: ‘Given that the legislation, if enacted, would introduce criminal sanctions for failure to comply with these new obligations, we are calling on the government to further clarify the steps that companies must undertake to ensure they remain compliant.’
Chair of the committee, Kathleen O’Reilly, said the Society hopes the legislation will impose the minimum administrative burden on companies and their controllers.