Although the PSC regime has only been in force since spring 2016, the government is now consulting on changes to the regime to make it compliant with the Fourth Money Laundering Directive.

The Directive came into force on 25 June 2015 and EU member states must implement it by 26 June 2017.

The consultation highlights two areas where the requirements of the Directive and the UK's existing PSC regime differ and where, therefore, changes to the UK regime will be necessary:

  • The Directive requires that centrally-held beneficial ownership information must be current. In contrast, under the UK's PSC regime companies and LLPs only have to report once a year to Companies House through the confirmation statement. (Companies must keep their own PSC registers up to date, but this is not "centrally-held" information.)
  • The Directive covers a broader range of entities including unregistered companies, open-ended investment companies, building and friendly societies, and Scottish limited partnerships.

In July 2016, the Commission published proposals to amend the Fourth Money Laundering Directive, including those parts of it which deal with the disclosure of information about beneficial ownership. These include a proposal to reduce the registration threshold for people with significant control from 25% to 10% for "passive non-financial entities" (i.e. holding structures). There is also a proposal that member states must set up central registers with the beneficial ownership information about trusts and other types of legal arrangements having a structure or function similar to trusts. These amendment proposals remain subject to negotiation by EU member states, as does the European Commission's proposal to bring forward to 1 January 2017 the date by which member states must implement both the Fourth Money Laundering Directive and its proposed amendments.

Consultation on the transposition of the Fourth Money Laundering Directive

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