UK Register of Foreign Entities

Provisions relating to the registration of land transactions with or by a foreign entity in UK land registers will come into force on 5 September 2022.

Where the foreign entity already owns property in the UK and acquired that property after 1 January 1999 in England and Wales, after 8 December 2014 in Scotland or after 5 September 2022 in Northern Ireland North, it must submit its application for registration in the ROE by February 1, 2023. The foreign entity cannot transact with its UK property from February 1, 2023 until it is registered in the ROE .

ROE is provided for under the Economic Crimes (Transparency and Enforcement) Act 2022. A foreign entity acquiring property in the UK will need to be registered in the ROE before an application can be made to register the acquisition in any of the UK countries. land registers as of September 5, 2022.

Who does the law apply to?

The law will apply to non-UK companies – even if the company is UK tax resident – and LLPs, as well as overseas foundations and non-UK partnerships which, under the laws of the country by which they are governed , have a separate legal status. personality if they are registered as the owner of a ‘relevant interest’ in UK property. Companies or LLPs incorporated in Jersey, Guernsey and the Isle of Man are all non-UK entities and therefore subject to the law.

What is a relevant interest in the property?

In England and Wales, an entity is considered to have a relevant interest in property if it has full ownership or a lease for more than seven years when the foreign entity’s application for registration as owner or lessee was made on or after January 1, 1999.

In Scotland, a relevant interest in ownership is ownership of property, a lease of more than 20 years or an assignment of a lease of more than 20 years where the application for registration of the foreign entity as owner or tenant was made on or after December 8, 2014.

In Northern Ireland, a relevant property interest is freehold or leasehold over 21 years where the application for registration of the foreign entity as owner or tenant was made on or after September 5, 2022.

Being the registered owner of a standard charge or security does not bring a foreign entity into the regime.

Do any exemptions apply?

The law provides for the introduction of regulations to exempt certain foreign entities from the regime. For the moment, no regulations have been taken.

What should the Companies House application contain?

The request must include one of the following statements:

  • that the foreign entity has identified all recordable beneficial owners and provided the required information;
  • the foreign entity does not believe it has recordable beneficial owners;
  • the foreign entity believes it has recordable beneficial owners but cannot provide the necessary information.

Before applying to Companies House, the foreign entity must give one month’s notice to its beneficial owners. The definition of beneficial owners is quite complex but includes anyone who owns at least 25% of the entity’s shares or voting rights, or who exercises or has the right to exercise significant influence or control. on the entity.

Failure to register and failure to update the register are criminal offences. It is also a separate criminal offense to make certain dispositions of property not listed on the ROE – see below.

Only part of the information entered on the BR is accessible to the public. Certain beneficial ownership information is exempt from inspection.

When do foreign entities need to be registered?

If a foreign entity has property in the UK, it must submit an application for registration in the ROE by February 1, 2023. The application must include a statement that the entity has not made a relevant disposition of property since February 28, 2022 or must include details of any arrangement that has been made.

A foreign entity acquiring property in the UK must be registered on the ROE before they can apply to register the acquisition in any UK land registry from 5 September 2022.

What happens when a foreign entity acquires property in the UK?

If a foreign entity is not registered in the ROE when it applies to register a qualifying recordable deed, such as a transfer, disposition or lease, with a UK land registry, the application will be rejected. Failure to register an acquisition of property or a lease with the relevant UK Land Registry means that the acquisition does not take legal effect.

What happens when a foreign entity disposes of property in the UK?

The entity and its officers commit a criminal offense if the entity issues a qualifying recordable instrument to a third party without being registered on the BR.

The third-party buyer, tenant or lender cannot register the deed in his favor without proof that the foreign entity owning the property is registered with the ROE or that the transfer falls under one of the limited number of exceptions.

How does a foreign entity register on the ROE?

To register on the ROE, the foreign entity must provide information about itself, the recordable beneficial owners and, in certain circumstances, the directors of the foreign entity.

Before an ROE application can be made, an information notice must be sent to each recordable beneficial owner asking them to confirm that the information the applicant is maintaining is correct and inviting them to provide any missing information. Recordable beneficial owners have one month to respond to this notice

Information submitted to Companies House must be independently verified by one of the limited number of persons acting in connection with the business of that company in the UK. At the moment it is unclear whether UK law firms will offer this verification service in practice. Further directives from the Bar are awaited and the risk analysis is in progress.

The steps foreign entities must take to comply with ROE requirements take time to implement, so affected entities are encouraged to gather the necessary information as soon as possible.

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