Commercial and local authority landlords could benefit from urgently reviewing their legal options.
Previously, you only needed to notify Companies House of any changes to PSCs in the company’s annual confirmation statement (formerly known as the annual return). However, from 26 June 2017, you need to let Companies House know every time a PSC changes by filing one of the forms (PSC01 to PSC09), which can be downloaded from Companies House or filed electronically. You must update the PSC registers within 14 days of the change, and send the appropriate form to Companies House within a further 14 days.
What is a PSC?
By way of reminder, a PSC is an individual who meets one or more of the following five conditions:
- owns more than 25% of the shares in the company;
- holds more than 25% of the voting rights in the company;
- has 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; or
- has the right to exercise or actually exercises significant influence or control over a trust or firm (which the trust or firm would be a PSC, if it were an individual).
“Significant influence” or “significant control” are alternatives and include:
- being significantly involved in the management and direction of the company (e.g. a person who regularly consults on and influences board decisions); and
- having recommendations always, or almost always, followed by those who hold the majority of the voting rights in the company.
We appreciate that it is misleading referring to the register of “persons with significant control” because it is not limited to individuals, and relevant legal entities (RLEs) may also need to be included. An organisation will be a RLE if:
- it is a legal entity (a body corporate);
- it would meet the definition of a PSC if it were an individual; and
- it is required to maintain its own PSC register, it is a company exempt from maintaining a PSC, or has to comply with comparable disclosure requirements relating to listed share companies.
For example, a parent company would be an RLE of its wholly-owned subsidiary company or companies and appear on the PSC register for the subsidiary. Any directors or trustees of an RLE will only appear on the PSC register of the subsidiary if they meet one of the five PSC tests above. There is a further definition of other relevant persons (ORPs), which covers local authorities and others that don’t fit within the definition of a PSC or RLE.
Remember, if your company has no PSCs then you must note this in the PSC Register; you must not leave the register blank. The guidance provided by Companies House says that in these circumstances your PSC register must state “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”.
If you have any queries regarding your PSC, please contact Katie Douglas or your usual contact at Anthony Collins Solicitors. To find out more about that work that we do at Anthony Collins Solicitors, please visit our website.
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