Persons with significant control - PSC's a simple summary

Anti Money Laundering

Form PSC01 Notice of individual person with significant control (PSC)
Real time information RTI for Persons with significant control PSC’s – The European Union Fourth Anti Money Laundering directive From 26 June 2017
Companies are required to register changes in PSC's with Companies House on forms PSC01 to PSC09.

First condition holds, directly or indirectly, more than 25% of the shares in company.
Second condition holds, directly or indirectly, more than 25% of the voting rights in company.
Third condition holds the right, directly or indirectly, to appoint or remove a majority of the board of directors of company.
Fourth condition has the right to exercise, or actually exercises, significant influence or control over the company even if not a shareholder or director.
Fifth condition - also applies to trusts and partnerships which meet any of the other four conditions.

about Companies House PSC Register details

Contacting your PSC

Directors must try to identify and contact anyone who could be a PSC of the company.
Refusing to provide PSC information is a criminal offence, and you can apply restrictions on their shares or voting rights following repeated failure to respond.

PSC Changes

The most usual changes to PSC details

Shareholders:
Changes in shareholder address and basic details etc.
New shareholder owning more than 25% of the share capital or more than 25% of the voting rights.
Bands:
Over 25% up to (and including) 50%.
More than 50% and less than 75%.
75% or more.
Changes in the percentage ownership band of an existing shareholder.
Where there are no shares:
Company limited by guarantee.
Limited liability partnership.
The same principles apply according to voting rights.
Also applicable to a person who:
Holds the right, directly or indirectly, to appoint or remove a majority of the board of directors.
Has the right to exercise, or actually exercises, significant influence or control over the company.
Significant influence or control provisions mean that related parties share capital and voting rights need to be agregated for PSC reporting.
Also applicable to individuals with control over shares and voting rights owned by trusts.
Also applicable to individuals with control over shares and voting rights owned by partnerships or other firms.
Meets one or more: Where more than one category applies to an individual, include all for that individual.

Frequently used PSC forms

The forms that most frequently apply:

File form PSC01 for new individual PSC.
File form PSC04 for change of individual's details.
File form PSC07 for ceasing to be a PSC - All entities.
See full list of PSC forms below.

When Joint Shareholders are PSC's

Each joint shareholder is taken to hold the entire shareholding in their own right for PSC purposes.
So where joint holdings apply, the total of PSC's may exceed 100%. This is correct according to the legislation.

When a trust is a PSC

Each trustee is taken to hold the entire shareholding in their own right for PSC purposes.
So where trustee holdings apply, the total of PSC's may exceed 100%. This is correct according to the legislation.

PSC's when the company is a Charity

Limited by guarantee.
Charity-owned trading subsidiaries.
Significant influence or control could apply to major donors, influential advisors, or founders.

Not PSC's

Significant influence or control excludes:
Directors - acting as employees; who hold less than 25% of shares or voting rights.
Routine professional advisers.
Lenders.
Customers.
Suppliers.

Time to notify changes in PSC's

Companies have 14 days, after any change, to update their PSC register and
An additional 14 days to submit the information to Companies House.
Criminal proceedings could result from the non submission or incorrect completion.
Penalties may be fines; custodial sentences are possible.

PSC Beneficial owners may NOT be

Foreign companies unless the foreign company is listed on a stock exchange equivalent to the London Stock Exchange such as the New York Stock Exchange and other well-known exchanges.
Companies with tax haven addresses.

PSC forms:

If you have elected to keep PSC register information on the public register the full date of birth is available for public inspection.
Form PSC01 New individual PSC
Form PSC02 and PSC03 Equivalent forms for significant control by other entities whether or not you have elected to keep PSC register information on the public register.
Form PSC04, PSC05 and PSC06 New individual PSC. Change details forms: Individual, Relevant Legal Entity RLE or Other registerable person ORP, respectively.
Form PSC07 Ceasing to have significant control form. Same form for Individual, Relevant Legal Entity RLE or Other registerable person ORP.
Form PSC08 and PSC09 Notification of PSC statements indicating that a company has taken reasonable steps to find out if there is anyone who is a registrable person or a registrable relevant legal entity (RLE), and if so, to identify them.

Persons of significant control (PSC's) are registrable persons

Companies must identify and report on Persons of significant control (PSC's)

There are Tick boxes on Form PSC08 to notify Companies House that:
☐ There is no registrable person.
☐ The company has not yet completed taking reasonable steps to find out if there is anyone who is a registrable person.
☐ There is an identified registrable person for whom details have not been provided.
☐ Section 790D Notice From: The company To: A 'new' registrable person:- Information has been requested from the person but has not been provided by them.
☐ Section 790E Notice From: The company To: An existing registrable person:- Information of change(s) has been requested from the person but has not been provided by them.

There are Tick boxes on Form PSC09 to amend or withdraw previous notifications on Form PSC08.