Register of Overseas Entities

Industry reacts to new register launched to crack down on dirty money in UK property market




On 1st August, the government gave its new Register of Overseas Entities the green light in a move to flush out corrupt elites laundering money through UK property.

After going live this week, it requires anonymous foreign companies that own or are seeking to buy UK land or property to declare their beneficial owners and/or managing officers.

This applies to those who bought property or land since 1st January 1999 in England and Wales, and 8th December 2014 in Scotland. 

Overseas entities only need to register property or land bought in Northern Ireland on or after 1st August 2022.

Those that disposed of property or land after 28th February 2022 will also need to provide the relevant details.

Not complying with the new rules will result in severe sanctions, including restrictions on buying, selling, transferring, leasing or charging their land or property in the UK.

According to a statement made by the government on 1st August, the new register was designed to “root out corrupt oligarchs and elites attempting to hide ill-gotten gains through UK property”.

“We have been clear that the UK is a place for legitimate business only, and to ensure we are free of corrupt elites with suspicious wealth, we need to know who owns what,” said business minister Lord Callanan.

“By getting this first-of-its-kind register up and running at breakneck speed, we are lifting the curtain and cracking down on those criminals attempting to hide their illicitly obtained wealth.”

Industry reacts to Overseas Entities Register

Sundeep Patel, director of sales at Together:

“The news that the government has launched a new register of overseas entities maintained by Companies House will likely be positive for BTL lending, as previously we have found that one of the biggest and most time-consuming parts of working with overseas clients was AML checks. 

“I would hope that the new register helps to streamline that process and make it more transparent, not just to protect lenders and solicitors, but also to offer a better service to clients. 

“The key to the success of this new register will be how checks are carried out to verify information, while remaining aware of any potential consequences that could occur as a result of inaccurate reporting.”

Jason Berry, group sales director at Crystal Specialist Finance: 

“The introduction of this public register should mean it’s now impossible for foreign buyers to purchase UK land or property anonymously. 

“Interestingly the requirements apply retrospectively on land purchased since 1st January 1999, so overseas entities which exist without clearly defined beneficial owners will find the new rules apply.

“Many of these entities will therefore find it difficult to sell, lease or take out new mortgage facilities on the land they own.”

David Hannah, group chairman at Cornerstone Tax:

“What people must consider is that the UK property market is an international market, meaning it can be affected by geopolitical events all over the world. 

“Even if domestic demand cools, I think international demand will increase and the UK market will be affected because of it. 

“I don't think foreign investment will be overly deterred by the new rules, with many being concerned that a number of loopholes exist in these plans.”

We will be discussing AML in the bridging market in the July/August issue of the B&C Magazine — subscribe now to receive your complimentary issue.

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