Changes to UK company law: what does this mean for your company?
In an effort to tackle economic crime and improve the quality and reliability of data held at Companies House, the Economic Crime and Corporate Transparency Act 2023 (ECCTA) has introduced some important changes to UK company law.
Director responsibilities are changing, and it is important that you understand how these changes will affect you and your company.
On 4 March 2024, Companies House introduced its first set of changes under the ECCTA. All companies will need to have an appropriate registered office address, supply a registered email address and confirm both on incorporation and when filing the company confirmation statement that their activities are lawful. We have summarised these three key changes below:
Registered office address
A company must ensure that its registered office is an ‘appropriate address’, being one to which a document delivered to the company can be expected to come to the attention of someone acting on its behalf and delivery can be recorded by an acknowledgement of delivery. As a result of this change, companies will no longer be able to use a PO box as their registered office address, however a third-party agent’s address that meets the conditions for an appropriate address can be used.
Companies risk being struck off the register if they do not provide an appropriate address. If the Registrar identifies an inappropriate registered office address being used, it will change it to a default address held at Companies House. A company then has 28 days to provide an appropriate address, with evidence of a link to that address. If such evidence is not received, it will start the process to strike the company off the register.
Registered email address
All new companies will need to provide a registered email address on incorporation and existing companies will need to provide a registered email address when they file their next confirmation statement.
Companies will have a duty to maintain an appropriate registered email address, in the same way as their registered office address. The registered email address is expected to be used by the Registrar to communicate with the company to provide updates, notices and reminders. It is therefore highly recommended that all directors of a company have access to such email address at all time and check it on a regular basis. Depending on individual circumstances, it may be that this means a new email address should be set up by the company specifically for this purpose. The registered email address will not be available for public inspection.
Any company that fails to maintain an appropriate email address without reasonable excuse will be committing an offence.
Lawful purpose statement
When incorporating a company, the subscribers will need to confirm that they are forming the company for a lawful purpose and existing companies will need to make a statement that their intended future activities are lawful when they file their next confirmation statement.
The intention of the new lawful purpose statement is to make it clear that all companies on the register have a duty to operate in a lawful way. Companies House will not accept documents if this statement has not been confirmed and may take action if they receive information that confirms a company not operating lawfully.
Directors should be aware that it is a criminal offence for a person, without reasonable excuse or knowingly, to make to the Registrar a statement that is misleading, false or deceptive.
Companies House fees will also increase from 1 May 2024. A list of the new fees can be found here Changes to Companies House fees – Changes to UK company law