For overseas entities who own or wish to buy, sell or transfer property or land in the UK, there is now a requirement to register with Companies House. Crucially, such entities must declare the identity of their beneficial owners or managing officers.
The government introduced the Register of Overseas Entities (ROE) on 1 August 2022 as part of the Economic Crime (Transparency and Enforcement) Act 2022 (the Act). The purpose of the Act, and subsequently the ROE, is to tackle economic crime through increased transparency about the ownership of overseas entities.
What is an overseas entity?
An overseas entity is defined by the Act as a “legal entity that is governed by the law of a country or territory outside the UK” and includes a body corporate, partnership or other entity that (in each case) is a legal person under the law by which it is governed.
Therefore, a non-UK trust would likely not qualify as an overseas entity as it has no legal personality.
All entities owned by foreign governmental agencies are required to register.
Who is required to register?
All overseas entities acquiring property or land in the UK and those who acquired land or property on or after:
- 1 January 1999 in England and Wales;
- 8 December 2014 in Scotland; and
- 1 August 2022 in Northern Ireland
Such land or property must be a qualifying estate which means it is either freehold or held under a lease granted for more than seven years.
Any prospective overseas entities who wish to purchase property or land in the UK must be registered with the ROE prior to such a purchase.
How to register
Anyone can register an overseas entity so long as they have an account with Companies House. The first step is for the overseas entity to identify its beneficial owners or managing officers. Information about such individuals, bodies or trusts is required as part of the registration process.
The next step is verification. A UK-regulated agent must carry out verification checks on each of the beneficial owners or managing officers. Solicitors are included in a list of professionals who can complete such checks. Where the agent is asked to verify foreign language documents, the person verifying those documents will be expected to understand the language in question.
A fee of £100 is payable to Companies House to register an overseas entity.
If an application is accepted, the details of the overseas entity will show on the public register and an ID number will be produced for that entity.
Consequences of non-registration
HM Land Registry will refuse to register land or property involving an overseas entity if it fails to do the following:
- register on the ROE; and
- comply with its obligations to update its information at the ROE annually.
Criminal sanctions will also be imposed on overseas entities who fail to register with Companies House. This includes financial penalties and up to five years custodial sentence. The latter is particularly significant for those who already own property in the UK as, if the overseas entity and information on its beneficial owners are not registered by 31 January 2023, then such entity will be restricted from dealing with the property after that date.
How can Buckles help?
Buckles can conduct the verification process for you and make the application. Where foreign language documents require verification, our International Team which includes native French, German, Italian, Spanish and Turkish speakers, can assist with the verification process in those languages.
If you would like to find out more, please contact:
Alvaro Aznar Azcarate, Head of International Department: alvaro.aznarazcarate@buckles-law.co.uk
Stephen Oliver, Partner Corporate & Commercial Department: stephen.oliver@buckles-law.co.uk
