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Control of UK Companies: Transparency

Volume 605: debated on Tuesday 26 January 2016

My noble Friend the Parliamentary Under-Secretary of State for Business, Innovation and Skills has today made the following statement.

On Monday the 25 January, I laid before Parliament draft regulations in connection with Part 21A Companies Act 2006. These establish the public register of information about people with significant control (PSC) over UK companies and limited liability partnerships (LLPs). This is an important step in providing much greater transparency about who owns UK companies and LLPs. This will boost trust in UK businesses, and reduce the risk of UK companies and LLPs being used for corrupt purposes.

The Government appreciate that transparency is usually in the public interest, as it is useful to know with whom one is doing business and helps deter and identify where corporate entities are being used for criminal activities.

The Government recognise that in certain rare circumstances publication of PSC information could put individuals at serious risk of violence or intimidation.

The draft regulations therefore provide for applications to be made to withhold the personal information of PSCs from public disclosure. In such cases the information must still be provided, and the fact that the information exists but is protected, will be made public. This is set out in more detail in Section 790ZG and regulations 33-45 of the draft Companies (Register of People with Significant Control) Regulations 2016.

Section 790J also enables the Secretary of State to make general exemptions to the new requirements. The Secretary of State has not granted any such exemptions, and would only be prepared to grant exemptions in very limited circumstances. These circumstances would be that the exemption is in the interests of national security; the economic wellbeing of the UK, or in the support of the prevention or detection of serious crime.

An exemption would also only be granted if the Secretary of State received satisfactory assurances on other matters like the company or LLP was not being run for personal benefit of any individual and that the exemption was necessary for the person seeking it to achieve their lawful objectives. I do not propose to comment further on whether I have received any such requests or whether I have granted them.