File an Overseas Entity Update Statement

The register of overseas entities is a record managed by the UK’s Companies House; a government body responsible for regulating companies.

The Companies House introduced “Registration of Overseas entity” in August 2022 as a key part of the government’s strategy to tackle global economic crime which requires overseas entities that own UK property or land to declare their beneficial owners or managing officers. Unless they have registered with Companies House and received a unique OE number, foreign entities are prohibited from engaging in activities such as purchasing, selling, transferring, leasing, or placing a charge on land within the UK.

Register of Overseas Entities | Progress till Date

The register currently contains over 28,000 entries, and the information it holds has been accessed over 500,000 times. This significant volume of searches indicates that the register is effectively fulfilling its intended purpose of enhancing transparency regarding the ownership of property and land in the UK.

The Register of Overseas Entities (ROE), designed to combat money laundering by criminals utilising UK property, has garnered praise and recognition from the global business registry network, making it the world’s first of its kind. The Corporate Registers Forum (CRF) honoured Companies House with an Innovation Award (Excellence) for successfully establishing and implementing this ground breaking register.

Introduction to Overseas Entity Update Statement

The Companies House has entered a new phase of service development, focused on creating a digital platform for updating statements and getting ready to impose financial penalties on entities that have failed to register. Every entity listed on the register is required to submit an Annual update statement, confirming the accuracy and update of the information held by Companies House.

Even if there have been no changes, entities must still file an update statement. The Companies House have communicated this legal obligation to all overseas entities through their registration confirmation email and will also send a reminder email to the email address that they have on file for each entity.

Note: The update statement of overseas entity can be filed online from August 2023.

Entities or their representatives will have the option to electronically submit their update statement, except in cases where trusts are associated with the overseas entity. This includes both trusts that have already been reported to Companies House and those that need to be disclosed as part of the update statement. For these entities, a paper form OE02 has been provided by the Companies House.

Specified Deadline for Annual Overseas Entity Update Statement Submission

The statement date falls within one year from either the registration date of the overseas entity or the date of the last update statement. Once the statement date is determined, there is a 14-day window to submit the overseas entity update statement. Failure to meet this deadline will result in a late filing, and it is crucial to submit it as soon as possible thereafter.

An update statement can only encompass a period of 12 months. If there is a requirement to cover beyond 12 months, an additional update statement need to be filed.

File your annual update now and avoid the risk of costly fines.

For example, 

If an overseas entity was registered on 13 Dec 2022, any changes up to 12 Dec 2023 needs to be updated/informed to the Companies House through annual update statement submission by 26 Dec 2023.

The registered overseas entity has the option to update its information separately from the annual update statement, but this involves a more complex procedure. The overseas entity must submit a written request to Companies House to modify the annual update date. If the request is approved by Companies House, the deadline for the next statement will be reset, extending it by 12 months.

Consequences of Late Filing for Overseas Entity Update Statement

Filing an annual overseas entity update statement is obligatory by law, even if there have been no changes to report. Following are few consequences for late filing for update statement:

• Legal and financial consequences- Failure to submit the update statement is considered a criminal offense, potentially leading to prosecution or the imposition of a financial penalty for entities that do not comply.
• Invalidation of OE ID and further consequence– If an entity fails to submit the update statement within the designated timeframe, the Overseas Entity IDs associated with them will become invalid. These IDs will remain invalid until the entity rectifies their record by bringing it up to date and filing the required update statement. This means there will be restrictions on property transactions like buying, selling, transferring, leasing, or raising charges for entities that miss the filing deadline.
• Missing update statement note added to public record– A notation will be added in the public records indicating non-compliance with the filing the update statement.

Information Required for Update and Review

Accurate information is required in the update statement whether there is any change or not, reflecting the current statement as of the statement date. Verification by a UK-Regulated agent within 3 months preceding the update statement date is mandatory for any changes made.

When utilising this online service to submit an update statement, all the information displayed on the register regarding the overseas entity as well as its beneficial owners or managing officers can be reviewed. It is essential to update any modified information accordingly. Additionally, there might be a requirement to re-enter residential addresses for individual beneficial owners and managing officers.

This service of update statement cannot be utilised by individuals who have their personal information safeguarded at Companies House as beneficial owners or managing officers, or those who are currently awaiting the outcome of an application.

In the past, the fee for submitting a registration application to Companies House was £100. However, the new charge will be £120.

Addition of Registrable Beneficial Owner or Managing Officer

In case, additional beneficial owners or managing officers are added, following relevant information will be required to furnish the addition:

• Full name
• Date of birth
• Nationality
• Correspondence address and home address
• Date they became a beneficial owner or managing officer
• Nature of control

Removal of Registrable Beneficial Owner or Managing Officer

It is mandatory to ensure to inform the record of any individuals who have become and ceased to be registrable beneficial owners within the update period. The information provided for these individuals should accurately reflect their details as of the date they stopped being a beneficial owner. Additionally, if there are no active beneficial owners, comprehensive information about each managing officer must be provided

No Changes to Report

Submission of an update statement is required, even in the absence of any modifications to the overseas entity and its beneficial owners during the update period. This ensures the accuracy of the information recorded in the register.

Regarding the trust associated with the overseas entity.

At present, the utilisation of this service is not available if the overseas entity has any trusts involved. This includes both trusts that have been previously reported by the entity and trusts that are required to be disclosed within this update statement. An update statement on paper via OE02 form must be filed even there are no changes to trust information.

Register of Overseas Entities Removal Requirements

If an Overseas Entity (OE) no longer owns land or any other qualifying interest in the UK, it can choose to be removed from the register. Like the annual renewal process, this will require the OE to verify or update the information about its beneficial owners on the register.

 Currently, removal from the register does not imply complete elimination from it due to lack of necessary statutes, instead, it implied that when an OE is removed from the register it will no longer need to update its information, and the entry on the register will only include the historical information previously provided.

Addition of a New Step in Process: Authentication Code 

In the past, the process of applying to register an overseas entity entailed completing the online form available on Companies House’s official website and remitting the requisite payment.

However, Companies House has recently implemented a new procedural requirement by incorporating the authentication code verification step into the registration process. Authentication code is a unique 6-character code which is mandatory for every overseas entity intending to submit online filings.

This code serves as a verification mechanism, as it must be provided each time an individual files online on behalf of the entity. Its purpose is to confirm the individual’s authorised status to carry out such filings. The requested code will be sent to the email address that the Companies House has on their record for the overseas entity.

Conclusion

Filing an overseas entity update statement is a legal requirement, which if not complied with, will be considered as criminal offence and fines and penalties shall be imposed by the Companies House. An update statement should contain correct and up to date data covering the determined period within a designated timeframe.