The Economic Crime and Corporate Transparency Act (ECCTA) introduces transformative changes to corporate law in the UK, targeting the prevention of economic crime through increased transparency and accountability ...
The implications of the Economic Crime And Corporate Transparency Act for directors and PSCs are significant!
Launched to mitigate the risks associated with corporate anonymity, the Act delineates new responsibilities for all company directors, persons with significant control (PSCs), and those who file information on behalf of companies.
"One of the most pivotal aspects of the ECCTA is the establishment of Authorised Corporate Service Providers (ACSPs)!"
These entities play a crucial role by conducting anti-money laundering (AML) activities, including client identity verification. From the 18th of March 2025, any third-party provider facilitating identity checks on behalf of Companies House must register as an ACSP.
Furthermore, the ECCTA stipulates a phased introduction of a comprehensive identity verification process. Beginning on the 8th of April 2025, individuals will have the option to voluntarily verify their identities, either directly through the government's digital platforms or via an ACSP. This marks a critical shift as all parties involved in the ownership and management of a business will soon be required to confirm their identity to prevent the utilisation of companies for illicit purposes.
In Autumn 2025, mandatory identity checks will come into effect. This means existing directors and PSCs will need to verify their information within a twelve-month grace period. This requirement extends beyond just new parties involved; all individuals operating, owning, or filing on behalf of a company must comply by Autumn 2026. Such robust measures reflect the government's commitment to combat economic crime, enhancing the reliability and scrutiny of corporate entities.
"The implications of the ECCTA for directors and PSCs are significant!"
They are no longer allowed the cloak of anonymity, and with this change comes the responsibility of ensuring compliance with the new regulations. Failing to adhere to these requirements may expose individuals and their companies to legal challenges, as the law ensures that corporate misconduct will not go unchecked.
With the right support and understanding of these regulations, companies can not only comply, but thrive in this evolving landscape.
As always, the Business Godparent is here to help.
Until next time ...
ROGER EDDOWES Business Godparent
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about the Economic Crime and Corporate Transparency Act, it may be a great idea to call me on 01908 774320 and let's see how I can help you.
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Roger trained at Edward Thomas Peirson & Sons in Market Harborough before working at Hartwell & Co, followed by Chancery, as a partner. He started Essendon Accounts and Tax with Helen Beaumont in 2014 as a general practitioner with a hands-on approach.
Roger loves getting his hands dirty, working with emerging, small-to-medium and family businesses to ensure they receive the best possible accountancy advice. Roger utilises an extensive network of business contacts to leverage the best guidance and practical solutions.
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