ECCTA 2023: Identity verification – proposed implementation timetable published

The Economic Crime and Corporate Transparency Act 2023 (“ECCTA 2023”) instigated a pivotal shift in Companies House’s role, making it an active gatekeeper over the accuracy of information kept on its registers.

Identity verification is a cornerstone of the ECCTA 2023. It aims to discourage anonymous or fraudulent filings, ensuring the accuracy and integrity of data kept on the registers. Having appropriate procedures in place will not only enhance corporate transparency but will support economic growth and aid in the prevention of economic crime, making it increasingly challenging to obscure control and ownership of a company.

Who will have to complete the identity verification process?

The ECCTA 2023 introduces obligatory identity verification which will apply to all UK companies, including Limited Liability Partnerships (“LLPs”). Once fully implemented, the following key stakeholders will be required to go through the verification process:

• Directors
• Members of LLPs
• Persons with significant control (“PSCs”)
• Nominated officers of relevant legal entities (“RLEs”)
• Any other individuals filing documents at Companies House on a company’s behalf

How can identity be verified?

Indirect verification:

From 25 February 2025, third parties subject to anti-money laundering regulations (such as accountants and legal advisers) will be able to register their businesses as Authorised Corporate Service Providers (“ACSPs”). Once registered, ACSPs will be able to submit information and carry out the relevant identity verification checks on behalf of their clients.

However, Companies House are yet to publish details of the ACSP application process.

Direct verification:

From 25 March 2025, individuals will be able to voluntarily verify their identity using Companies House’s new online platform, GOV.UK One Login. Guidance as to the process is still awaiting publication.

When does identity verification become compulsory?

Current guidance suggests that identity verification will become compulsory from Autumn 2025 with respect to any new incorporations, and any new director, PSC or RLE appointments. Meanwhile, any existing directors, LLP members, PSCs and RLEs will be granted a transition period of up to 12 months, with their identification verification forming part of the next annual Confirmation statement filing.

Current guidance suggests that by Summer 2006 identity verification will become mandatory for all document presenters.  There will also be a requirement for all third party agents filing on behalf of companies to be registered as ACSPs.

Consequences of non-compliance and practical guidance

Failure to comply with the identification verification regime can result in significant fines and potential imprisonment. It is therefore critical that companies are aware of the imminent changes and make the necessary preparations ahead of time.

We would recommend that companies start reviewing the accuracy of director and PSCs information held at Companies House, as well as develop internal processes to manage identification verification obligations going forward. Companies would also be advised to engage in the verification process once it becomes available, either directly or via an ACSP, to ensure compliance.

If you would like to discuss what measures you and your business can take to ensure compliance with the identity verification regime, please contact our Corporate team by phone on 0113 207 0000.