Economic Crime and Corporate Transparency Act 2023
On the 4th of March 2024, the Economic Crime and Corporate Transparency Act 2023 (ECCTA) ushered in the first wave of alterations to company secretarial procedures. Chief among these changes was the introduction of the mandate for companies to furnish a registered email address.
In this article, we delve into the specifics of these recent adjustments and provide strategic insights to aid businesses in their preparations.
New Company Formations
For newly established entities, it is now mandatory to supply a registered email address for the company or Limited Liability Partnership (LLP).
Additionally, the following requirements must be fulfilled:
- Confirmation that both the registered office address and the registered email address are deemed 'appropriate,' meaning that correspondence sent to these addresses should reasonably be expected to reach a person acting on behalf of the company.
- Affirmation of the company's intended lawful activities (this declaration is not obligatory for LLPs).
Formation requests submitted prior to the 4th of March 2024, even if pending processing by the Registrar, will be handled based on the previous regulations, thus exempting them from the necessity of a registered email address or the provision of new statements.
Furthermore, the utilization of a PO Box address as a registered office address is explicitly prohibited. Any attempts to register a company or LLP with a PO Box address will be rejected. Instead, a verifiable physical address—a genuine street address complete with a building number and postcode—must be provided.
Companies House will also conduct more thorough assessments of proposed company names. Formation requests will be turned down if the suggested name:
- Suggests criminal intent for the company or LLP.
- Indicates connections to foreign governments or international bodies.
- Incorporates computer code.
Confirmation Statements
Changes have also been effected on confirmation statements submitted for existing companies. Specifically:
- All confirmation statements dated on or after the 5th of March must affirm that the future activities of the company or LLP are lawful.
- The initial confirmation statement submitted for a company or LLP incorporated before the 4th of March 2024 with a date on or after the 5th of March must include a registered email address.
- Confirmation statements dated the 4th of March 2024 or earlier remain unaffected by these amendments, regardless of when they are submitted.
Change of Registered Office Address
Any alteration to the registered office address now necessitates confirmation that the new address is 'appropriate.' As with new formations, submissions attempting to change the registered office address to a PO Box address will be rejected.
Change of Registered Email Address
If a registered email address has been provided for a company or LLP at incorporation or through the first confirmation statement after the 4th of March 2024, it might require subsequent updates, which are to be executed through a new form of submission.
Companies House is introducing a new electronic form for companies and LLPs to modify their registered email address. This form is solely for updating the email address provided at incorporation or in the first confirmation statement post-implementation.
Purpose of the Registered Email Address
The registered email address will serve as the primary mode of communication from Companies House regarding the company, including reminders, queries, or challenges concerning information on the public record. This transition from postal to electronic communication is expected to enhance efficiency and convenience for many companies.
The legislation ensures the confidentiality of the provided email address, similar to the residential addresses of directors and Persons with Significant Control (PSCs), by not disclosing it to unauthorized users or publishing it on the public register.
Affected Parties
The obligation to furnish an appropriate email address extends to:
- All UK companies, including both new entities and those already registered at the time of implementation.
- Limited Liability Partnerships (LLPs) on the same footing as UK companies.
- Limited partnerships, with a transitional period stipulated in Clause 117 of the Act for existing partnerships to verify their registered email address with the registrar.
This requirement applies irrespective of the preferred mode of communication with Companies House, mandating the provision of an email address for the formation and management of a company.
Validity of the Email Address
According to the legislation, an email address is considered appropriate '… if, in the ordinary course of events, emails sent to it by the registrar (i.e. Companies House) would be expected to come to the attention of a person acting on behalf of the company.'
Practically, the registered email address:
- Can be newly created or existing.
- Does not need to belong to the company's domain.
- Can be the same for multiple companies.
- Need not be a personal address of a company officer.
- Can be the email address of an accountant or agent managing company secretarial tasks.
Verification of the email address at the time of provision is not stipulated, although ensuring its validity is crucial to receiving correspondence from Companies House.
Failure to furnish an appropriate email address without a valid excuse constitutes an offense punishable by fine. Companies House may invalidate an email address if correspondence sent to it bounces due to invalidity or full capacity.
For New Companies
Requests to form new companies or LLPs must now include the intended registered email address. Any formation request lacking an appropriate registered email address will be rejected.
For Existing Companies
For companies or LLPs existing before the 4th of March 2024, the first confirmation statement dated on or after the 5th of March must include a registered email address. Submission of this statement without an email address is not permitted.
Exemptions from Providing an Email Address
According to Companies House, an email address is unnecessary and may result in rejection in the following cases:
- Confirmation statements with a date on or before the 4th of March 2024, even if filed thereafter.
- Companies formed on or after the 4th of March 2024. Changing the email address provided will require a separate form.
- Subsequent confirmation statements dated after the 4th of March 2024. Collection of the email address through the confirmation statement is a one-time transitional provision.
Change of Company Name
The same restrictions imposed on company names during incorporation now apply to name changes for existing companies or LLPs. A change of name request will be rejected if the proposed name suggests criminal intent, foreign affiliations, or incorporates computer code.
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