Welcome to our guide on the Register of People with Significant Control (PSC).
If you’re involved in running a UK private company, a limited liability partnership (LLP), or a Societas Europaea (SE), you’ve likely come across this term. Since 6th April 2016, it’s been a legal requirement for these entities to maintain a PSC register.
But what exactly does this mean, and why is it important?
The PSC register is a statutory register that contains information about individuals or legal entities who have significant control or influence over a business.
The main aim of this register is to enhance transparency, facilitate the transfer of important company data, and boost corporate trust within the UK.
By making this information readily available to enforcement agencies, other businesses, and the general public, the PSC register is a powerful tool in improving corporate behaviour, deterring money laundering, and sanctioning those who hide their ownership or control of UK companies for illegal purposes.
Understanding the Concept of a Person with Significant Control
So, who qualifies as a Person with Significant Control (PSC)? A PSC is an individual or a registrable legal entity that meets one or more of the following conditions in relation to a company:
- Directly or indirectly holds more than 25% of the company’s issued share capital
- Directly or indirectly holds more than 25% of the company’s voting rights
- Directly or indirectly holds the right to appoint or remove a majority of the board of directors
- Has the right to exercise, or actually exercises, significant influence or control of the company, LLP, or SE
- Has the right to exercise, or actually exercises, significant influence or control over the activities of a trust or firm which is not a legal entity, but would itself satisfy any of the first four conditions if it were an individual
Decoding “Significant Control or Influence”
The term “significant control or influence” might sound a bit vague, but it’s a key part of understanding the PSC register. An individual or a legal entity (like another company or firm) who has significant control or influence over a company can be considered a PSC.
According to guidance from Companies House, “control” and “influence” can be exercised in various ways, such as:
- Directing the activities of a company, trust, or firm
- Ensuring that a company, trust, or firm generally adopts the activities they desire
- Having absolute decision rights over decisions related to the running of the business of the company, such as adopting or amending the company’s business plan or making additional borrowing from lenders
- Holding absolute veto rights over decisions related to the running of the business of the company
- Regularly or consistently directing or influencing a significant section of the board, or being regularly consulted on board decisions and whose views influence decisions made by the board
- Making recommendations to the other shareholders on how to vote, and those recommendations are always or almost always followed
Information Required for the PSC Register
Once you’ve identified your PSCs, you’ll need to gather specific information about them for your PSC register. The information required will depend on whether the PSC is a person or a registrable relevant legal entity (RLE).
If the PSC is a person, you’ll need to record:
- Name
- Date of birth
- Nationality
- Country/state of residence
- Service address
- Usual residential address (if the residential address is used as the service address, you don’t need to provide it again)
- The date on which the individual became a PSC in the company
- The date on which the PSC register was updated
- Which of the five PSC conditions have been met, with quantification of the interest where relevant (for conditions 1 and 2, this must include the level of their shares and voting rights, within the following brackets: over 25% up to 50%; more than 50% and less than 75%; 75% or more)
- Any restrictions on the public disclosure of the PSC’s information
If the PSC is a registrable RLE, you’ll need to record:
- Registered name
- Registered office or principal office
- Legal form and the law by which it is governed
- Registration number and company register on which the RLE appears
- The date on which it became a registrable RLE in relation to your company
- Which of the five conditions for being a PSC have been met, with quantification of its interest where relevant
Responsibility for Maintaining the PSC Register
Maintaining the PSC register is a legal responsibility that falls on company directors, company secretaries, and designated LLP members. This responsibility includes identifying PSCs, obtaining and confirming PSC information, maintaining the firm’s own PSC register, and delivering the required PSC information to Companies House on the appropriate forms. It’s also important to check and confirm registered PSC information on the annual confirmation statement.
Failing to comply with these requirements is a breach of statutory duties and a criminal offence. The consequences can be severe, potentially resulting in a personal fine and/or a prison sentence of up to two years. Therefore, it’s essential to take this responsibility seriously and ensure that your PSC register is accurate and up-to-date.
Updating the PSC Register and Filing PSC Information at Companies House
Keeping your PSC register up-to-date is not just a one-time task.
Since 30th June 2016, the Companies Act 2006 has required all new companies to submit their PSC position on incorporation. Any changes that occur must be recorded in the company’s register of People with Significant Control within 14 days. Companies House must be informed of these changes within 14 days of the information being recorded on the PSC register.
This is known as the ‘14+14 rule’, meaning that the company’s PSC register and the records held at Companies House must both be updated within 28 days of any changes to a company’s PSC position. Filings to Companies House are made using forms PSC01 through PSC09.
Additionally, when a company files a confirmation statement (CS01), they are confirming that the PSC information on the public register is correct and up-to-date.
Maintaining Other Statutory Company Registers
The PSC register is an important tool for transparency and accountability, but it doesn’t replace existing statutory company registers. These include the registers of shareholders, guarantors, company directors, company secretaries, or LLP members. You must identify all PSCs and enter their details on the PSC register, in addition to maintaining your existing statutory registers.
What to Do If There Are No PSCs
What happens if there are no PSCs that meet any of the five conditions? In this case, you must still maintain the PSC register. However, you should enter the following statement on the register: “The company knows or has reasonable cause to believe that there is no registrable person or registrable relevant legal entity in relation to the company.” This ensures that the register is never left empty, even if there are no PSCs.
Retention of PSC Information
Once a person is no longer a PSC of the company, you might think that their information can be removed from the register. However, companies are legally required to keep information about People with Significant Control for ten years after they have stopped being a PSC of the company. Their details will be kept by Companies House indefinitely.
Inspection of the PSC Register
The PSC register isn’t just for internal use. You must keep your PSC register at your registered office or SAIL address and make it available for inspection upon request. Companies House must be informed about the location of your PSC register. Any person or organisation may request to inspect your PSC register free of charge or receive a copy for an optional fee of up to £12. Upon granting access to the register, you must not disclose any PSC’s usual residential address.
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