Important changes to access to information on directors' residential addresses and shareholders addresses - posted 3 July 2008
Director's usual residential addresses
BERR has published a number of consultations on further regulations to the Companies Act. A critical element for organisations transacting with commercial companies is the proposed changes to the registration of directors' usual residential addresses and to the record of shareholders at Companies House.
Read the consultation on access to Directors' usual residential addresses, which closes 11 July.
At the end of the response to the consultation we also refer to the issues of access to shareholders' addresses on non traded companies, which we are advised will no longer be available from Companies House wef later this year. Since many lenders are required to perform prevention of money laundering checks on any shareholder with ≥ 25% equity (whether or not they are a director) this will inevitably result in an overhead in collecting the addresses of said shareholders. It will further create issues in the tracing of unpaid debts.
Read the Experian response (Word document).
Shareholders' Addresses
Please see full details for the latest viewpoint of Companies House on the Companies Act. The significant section in respect of shareholders' data is copied below which says that such data will no longer be available for non traded companies from later this year.
Changes to the annual returns requirements (1985 Act)
Sections 116-119 of the Companies Act 2006 were brought into force in October 2007 which allowed companies to restrict access to their register of members. To facilitate this, annual returns made up to a date on or after 1st October 2008 will contain reduced information on the company’s shareholders. The information provided on the annual return will depend on whether or not the company has any of its shares admitted to trading on a regulated market (traded company). Private and non-traded public companies are only required to provide names of shareholders, not addresses. Traded public companies are required to provide names and addresses for those shareholders holding at least 5% of any share class.
Will members or shareholders' addresses still be available from Companies House?
Where addresses have been provided to Companies House as part of the annual return of a traded public company these will still be made available to the public. We will reject any annual returns that contain shareholders addresses if the company is not a traded company.
Experian response to the consultation on secondary legislation to the Companies Act
Experian's response to the proposed secondary legislation is attached and focuses on the need for Credit Reference Agencies to continue to have full access to all Directors' and Shareholders' home addresses in order to access data for use in decision and fraud prevention systems. Notwithstanding the need to protect directors and shareholders that are deemed to be at risk it is possible to manage access to the information such that it is used as a match key to access data but is not actually provided to the end user.
Read the response to the consultation on The Implementation of the Companies Act 2006 (pdf) »
Last year, following intervention from Experian, the DTI included provisions in the Companies Act for the new restricted directors' addresses to be made available to credit reference agencies. The restricted address provision is an extension of the current arrangement designed to enable those directors that consider themselves to be at risk to restrict access to their home address information. Experian totally supports this requirement but was concerned that unless credit reference agencies could access this information for legitimate credit checking and fraud prevention activities such people would be further disadvantaged and / or inconvenienced. Furthermore, as the new provision no longer requires the applicant to evidence a reason for their exclusion it could be used by those seeking to perpetrate crime and fraud.
On this basis, Experian successfully argued that the information should be made available for certain restricted and controlled purposes on a similar basis to the provisions for the use of the electoral register under the Representation of the People Act. The provisions could not be enacted until secondary legislation to The Companies Act 2006 were implemented.
During the course of the passage of the (then) Bill through parliament an amendment to the Companies Bill allowed for directors who considered themselves to be at particular risk to ask for extra protection and seek exclusion or removal from CRA records too.
The DTI has now published a consultation document which includes the provisions on access to director's home addresses with responses due by 31 May 2007.
The operative questions on this matter are in chapter 2.
Experian will be responding and urges all with an interest in this issue to consider communicating their views to the DTI.
Visit the DTI consultation page »
Disclaimer: The information contained on this webpage is provided for general guidance only. It is not intended to provide you with professional advice nor is it intended to substitute you obtaining professional advice.
