Hot on the heels of the introduction of the Register of Persons Holding a Controlled Interest in Land (RCI) last month, we are about to see further measures implemented. These measures will give additional transparency on foreign ownership of land and property in the UK and crack down on foreign criminals using UK property to launder money.
Unlike the RCI, which is held by the Registers of Scotland to show who has significant influence or control over the owner of land in Scotland, the new Register of Overseas Entities (ROE) is UK-wide in scope and will give details of the beneficial ownership of all overseas entities that own UK property. Overseas entities will not be able to buy, sell, transfer or lease land, or create a charge against the land in the UK unless they have registered in the ROE, which will be held and maintained by Companies House.
Similar to the transparency aims of the RCI, the ROE will require anonymous foreign owners of UK property to disclose their identities to ensure that they cannot hide behind secretive chains of shell companies.
Once the overseas entity has registered and provided all the necessary information, an ID will be provided by Companies House for the entity. In Scotland this ID will need to be shared with the Keeper of the Registers of Scotland and used whenever the overseas entity buys, sells, transfers, leases or charges land in Scotland.
The measures under the ROE will apply to any company or similar legal entity that is governed by the law of a non-UK country. Overseas entities that already own land in the UK will be given 6 months to register their beneficial owners or managing officers from the date that the register is launched.
Companies House are contacting all overseas entities captured by the Act that own land in Scotland (and England and Wales) to make sure they are aware of their new responsibilities. The measures will apply retrospectively to property bought since December 2014 in Scotland (and since January 1999 in England and Wales).
Amendments are being made to the Land Registration etc (Scotland) Act 2012 requiring the Keeper to reject applications for registration in favour of unregistered overseas entities.
If you are acting in conveyancing transaction for a party transacting with an overseas entity, you will need to confirm that the overseas entity is registered in the ROE. You will also have to confirm the date of registration, the entity’s ID reference and that the entries for the entity in the ROE are up –to date.
The launch date for the new register is yet to be announced, however you can be assured that Millar & Bryce will be on hand to provide you with a search in the ROE when applicable.
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