COMPANY control and ownership is about to become more transparent with the next implementation of the Small Business, Enterprise and Employment Act, which is set to be introduced at the end of June.

From June 30, companies will be required to reveal the ultimate beneficial owners and details of their holdings, as the information within the persons with significant control (PSC) register will be made publicly available for the first time.

The move comes after the PSC Register was introduced, as part of the SBEE Act, on April 6, 2016 in order for certain UK companies and LLPs to ‘take reasonable steps to identify’ every person who has, directly or indirectly, significant control over the company.

It means an end to faceless ownership and ‘sleeping’ partners.

Corporate transparency is a pressing economic issue and as the European Union progresses with the creation of a fourth money laundering directive which will further increase the need for transparency across all types of corporate entities, the UK is taking a leading approach.

Through the SBEE Act, the UK Government is aiming to provide greater transparency surrounding the ownership of companies, which should enhance greater disclosure to clamp down on tax evasion, money laundering, and organised crime.

While the move has been praised for improving corporate transparency, there are still unanswered questions as to how the upcoming SBEE Act changes will affect the UK economy.

With an additional administration burden on limited companies, there are concerns that small to medium-sized companies, who often rely on private equity, may find fewer investors willing to offer financial support.

In addition, the prospect of more transparent business laws has raised privacy concerns among investors, and this it remains to be seen as to whether or not the upcoming legislation will deter inward investment.

Charlotte Blair, general manager of business intelligence at South Wales-based Legalinx-7side, said: “Transparency is a pressing issue at the moment, especially with the recent Panama leaks, and the next implementation of the SBEE Act on June 30 will certainly help to address this concern.

“Understandably with the announcement that the information within the PSC Register will be publicly available there are concerns from business leaders throughout the UK about privacy, but Companies House has taken a number of steps to address privacy concerns, and it has been confirmed that the full date of birth and residential address details of the PSC will not be made publicly available.

“What remains to be seen however is whether or not the SBEE Act will benefit the UK economy. With greater scrutiny on company ownership and more administration burdens, there is a big question surrounding the SBEE Act’s impact on inward investment, which is especially important for smaller companies who rely on private funding to grow.

“We encourage all companies to be aware of the PSC Regime with their statutory filing requirements. To comply with the legislation, companies will be legally required to file their PSC information at Companies House as part of the confirmation statement, which replaces the annual return from this date, or when companies, LLP’s and SEs are incorporated.

“Companies will have to declare their PSC’s and not doing so could result in a number of penalties. If any company is concerned about the PSC Regime we urge them to seek support and advice before 30 June.”