The Economic Crime and Corporate Transparency (ECCT) Bill, which will change how Companies House is regulated, has been introduced to Parliament.

The development, which happened in September 2022, is a key step in the process of the Bill becoming law, as it marks the start of its journey through the Houses of Parliament. 

Once passed, the Bill will significantly reform the role of Companies House. It aims to improve the transparency of UK companies, as well as other legal entities, with the following changes:   

• The strengthening of enforcement powers to enable the Government to proactively share information with law enforcement bodies in cases where they have evidence of suspicious behaviour. 
• The broadening of government powers (to give the Government a more active role in gatekeeping the creation of companies).
• Improving the financial information on the register to make it more reliable and reflective of the latest technology.
• The introduction of identity verification for people who register companies or file with Companies House (this is to improve the accuracy of government data and assist law enforcement).

The new introductions are aimed at further protecting the UK from money laundering schemes, which involves the unlawful funnelling of money through UK companies. 

Before becoming law, it may or may not be amended by either the House of Commons or the House of Lords. Both houses will need to agree on the specifics of the Bill before it can be passed, after which it can be formally implemented. 

Speaking of the changes, the Companies House Chief Executive, Louise Smyth said: 

“We welcome the measures outlined in this Bill, which represent the most significant and far-reaching changes to the UK’s company register in over 170 years of history and will enable us to play a much stronger role in making the UK a great place to do business.”

She added: “If agreed, these changes will allow us to actively improve and maintain the integrity of the register like never before, inspire greater trust in our data, crack down on economic crime, and further drive confidence in the UK economy.”

The Bill is likely to achieve Royal Assent (the point at which it becomes law) in the spring of 2023.