Companies House, the UK’s official register of company information, is to be reformed under new plans intended to prevent fraud and money laundering.
As part of the reforms, directors will have to have their identity verified by Companies House before they can be appointed.
This additional step in the process should increase the accuracy of data that Companies House retains, meaning that businesses will benefit from greater assurance when they are entering into transactions with other companies.
The move will also assist law enforcement agencies, such as the National Crime Agency (NCA), to trace suspected fraudulent or criminal activity.
Companies House is understood to be developing a 24/7 digital verification process to reduce the administrative burden on businesses and prevent delays to incorporation and filings.
The Government has said that these reforms will not impact upon the typical speed at which a company or organisation is formed and at which other filings are completed – most companies can be incorporated easily, within 24 hours.
The changes come as a result of the Government’s 2019 consultation on Corporate Transparency and Register Reform.
As part of this, Companies House will be given additional powers to query and reject information, improve the quality of data kept on the register and provide greater protections to users’ personal data.
The Government will also consult on further changes to make Companies House more helpful and practical, including reforms to the filing of company accounts.
Broader transformation of systems will bring further business benefits by streamlining and digitising processes and improving the overall user experience.
Exactly when the new identity verification system will be in place is yet to be confirmed, but we will aim to keep you up to date as and when new guidance is issued.