On 1 August 2022, the UK government introduced the register of overseas entities (ROE) created under the Economic Crime (Transparency and Enforcement) Act 2022. Under the ROE, any anonymous foreign owner of a UK property have to reveal their identities. Once a foreign owner of UK property reveals their identity, they will then be able to buy, sell or transfer land or property in the UK.
The ROE was introduced to provide an extra layer of transparency allowing law enforcement agencies to investigate any suspicious wealth and combat financial crime, particularly money laundering, tax evasion and corruption flowing into UK property by foreign criminals.
What are the qualifying criteria of the Register of Overseas Entities?
The ROE applies to any overseas entity who are registered owner of:
- A freehold estate, or
- A lease granted for a term of 7 years or more on or after 1 January 1999
What is an overseas entity?
An overseas entity can be a company or organisation that is governed by the law of a country other than the UK.
When does an overseas entity need to register?
For any overseas entity that already own UK property or land and meet the criteria of the ROE, they have six months starting 1 August 2022 to register:
- The details of the beneficial owners, and
- Details of the managing officers and any superior trusts
For any overseas entity looking or are in the process of purchasing property in the UK, they must register the details of the beneficial owners and complete the registration process with Companies House to obtain a Companies House issued overseas entity ID number before they can submit an application to HM Land Registry to become the registered owners.
Overseas entities that have disposed of UK property or land after 28 February 2022 will also need to register their details and provide information about the disposal.
It would be deemed to be a criminal offence in the form of a fine or prison sentence or both, if any applicable overseas entity fails to register their details under the ROE. Foreign entities will also have restrictions in place when buying, selling or transferring property or land in the UK.
Who is a beneficial owner?
A beneficial owner can be an individual or an entity who has significant influence or control of the overseas entity. A beneficial owner can be:
- An individual person
- A legal entity, such as a company
- A government or public authority
- A trust or trustee
What information does an overseas entity need to submit?
The overseas entity will need to submit the following details:
- The name, date of birth and nationality of the beneficiary and managing officer
- The country the overseas entity was formed
- The registered office address and correspondence address
- Email address
- Legal form and governing law
- The public register the overseas entity appears on and its registration number
If an overseas entity has disposed a UK property or land since 28 February 2022, the following details will also need to be submitted:
- The deed or title number of the land or property
- The date of when the property or land was disposed
- Details of any additional beneficial owners or managing officers at the time of disposal
Where will the information be held?
The information of the beneficiary of an overseas entity will be held on Companies House. The register will be publicly accessible, but not all of the information will be available to the public.
Details of the beneficiary needs to be updated annually, once the overseas entity has registered with Companies House. Both the overseas entity and its beneficiary and managing officers will be in breach of the Act if they fail to update their details.
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