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The government has issued a response to its proposals to introduce a register of beneficial owners of overseas companies that own property in the UK in an attempt to tackle corruption.
The government is proposing that all legal entities that hold property or wish to acquire property in the UK in the future will have to provide details of beneficial ownership to Companies House.
The definition of a beneficial owner will be aligned with the current definition of “person with significant control” which applies to UK companies.
The proposals apply to freehold properties and to “leases of registrable duration”. It is not clear from the response whether the proposal will apply to all registerable leases or simply those for the duration of 7 years or more.
Where a property has been transferred to an overseas owner, a restriction will be recorded on the title to that property if the entity is not fully compliant with the register’s requirements.
In circumstances where an overseas entity has already acquired property in the UK there will be a period of time within which the entity must be compliant with the register. The period of time is yet to be decided.
The register is intended to be operational by 2021. The statutory restrictions are intended to act an incentive for those overseas entities looking to sell, lease or realise the property’s value in any way.