Economic Crime and Corporate Transparency Act 2023: what overseas groups and cross border dealmakers need to know

The Economic Crime and Corporate Transparency Act 2023 (ECCTA) represents the most far‑reaching overhaul of UK corporate transparency and Companies House powers in decades. Although enacted in the UK, the regime also has significant consequences for international groups with any UK footprint – whether through subsidiaries, branches or UK‑related M&A.

The reforms are broad, materially impacting governance, deal execution risks and timing considerations, coupled with an expanded corporate criminal liability framework. Timelines for implementing the reforms are phased through to 2027, with several crucial changes already in force.

This article summarises some of the key reforms and practical considerations for overseas organisations.

Empowered Companies House Registrar

Companies House – the UK Registrar – has moved from a passive gatekeeper of information to an active regulator, with statutory objectives to improve the integrity of the UK corporate register. It can query, reject or remove filings (including historic entries), annotate the register and share data with enforcement agencies. The Registrar can now also impose substantial fines, alongside existing powers to prosecute criminal offences.

In practice, UK subsidiaries of overseas parents should expect more rigorous review of both new and legacy filings. Transactions will require greater diligence and parties may need to budget time for rectifying material discrepancies that could otherwise delay completion.

Likewise, overseas companies operating via UK branches (also referred to as ‘UK establishments’) should expect the knock-on effects of the Registrar’s enhanced powers: more queries, stronger name checks (where applicable), and more active data sharing and cross-checks regarding their UK establishment filings.

Mandatory identity verification – a new gating item

Identity verification (IDV) became compulsory from 18 November 2025 for all company directors, LLP members and persons with significant control (PSCs), phased in over 12 months. Nationality and residence are irrelevant – overseas directors and PSCs are also in scope.

Most individuals will be able to complete IDV directly with Companies House via a free online service. If individuals are unable to satisfy the documentation requirements (eg lacking biometric ID) or face logistical hurdles, they will need to engage an authorised corporate service provider (ACSP) to verify their identity.

IDV is a one-off requirement (subject to limited exceptions). Verified individuals will receive a personal code that will also be linked to any other roles held (eg directorships) across other UK entities. Individuals must complete IDV by their first applicable deadline.

New directors should complete IDV prior to appointment, as unverified individuals cannot legally act. Likewise, incorporations will be rejected where proposed directors have not completed IDV. Existing directors will need to confirm that they have completed IDV in line with the company’s first confirmation statement due after 18 November 2025. IDV deadlines for PSCs will depend on whether they are also a director. For further details on timings and process click here.

Risks of non-compliance

Individuals who fail to complete IDV will commit a criminal offence, as will companies with an unverified director (and every officer of the company). In addition to fines, non-compliance may also result in:

• unverified individuals being restricted from submitting filings at Companies House;
• corporate registers being publicly annotated as non-compliant (which could, for example, impact on insurance and finance availability); and
• disqualification proceedings for unverified directors with a history of persistent breaches.

Consequently, IDV has become a critical gating item for governance, corporate actions and transactional timelines.

Overseas companies with UK establishments

The IDV regime extends to individual directors of overseas companies with UK branches on substantially the same timetable, irrespective of whether they are involved in the UK business. Practically:

• registration and appointments– an individual appointed as a director will need to verify their identity before registering the UK establishment at Companies House. Similarly, for appointments to an existing branch, individuals will need to complete IDV before their appointment is notified to Companies House. Until their identity is verified, they must not act as a director of the establishment while in the UK;
• existing directors must have completed IDV by the first anniversary of the UK branch being opened, following November 2025 (for example, if the UK branch was registered on 10 June 2014, the deadline will be 10 June 2026).

IDV implications – businesses and transactions

The introduction of mandatory IDV raises several key transactional and operational considerations.

• Delays to company formations and transactions– corporate incorporations without verified directors will be rejected by Companies House. Likewise, new appointments to existing entities will be unable to act unless they have completed IDV. In turn, this could also delay time-sensitive transactions or restructurings if IDV is not planned in advance.
• Increased administrative burden – businesses will need to identify who needs to verify and track the IDV status for all relevant individuals, ensuring compliance by the applicable deadlines. This may require updates to internal governance procedures and record-keeping systems. Likewise, onboarding processes will need to be revised to ensure new directors and PSCs complete IDV (if they have not already done so) and provide their personal codes in a timely manner.
• International role-holders – foreign individuals and those based outside the UK may face additional challenges in using the Companies House online service to complete IDV, potentially affecting governance arrangements, so they should be identified early to consider if an ACSP will need to be engaged.
• Cross-border M&A – along with the considerations above, deals will require additional due diligence to check whether all directors and PSCs of the target (and any acquisition vehicle) have already completed their IDV or will meet their deadlines. Likewise, signs of Registrar intervention – register annotations, rejected filings, default addresses, or queries – could signal governance weaknesses or delayed filings risk, and is a potential red flag for lenders and insurers. As part of risk allocation, parties can also expect additional warranties and undertakings regarding IDV, filing accuracy and administrative compliance.
• People who file at Companies House will be brought into the IDV regime (no earlier than November 2026) – in due course, this will need to be factored in to ensure that authorised individuals are in place to handle both routine and post-completion filings.

Centralised statutory registers and shareholder transparency

From 18 November 2025, businesses no longer need to maintain local statutory registers for directors, secretaries or PSCs. Information that would be entered in the local registers will still need to be provided to (and maintained on central registers at) Companies House. Consequently, this places even greater importance on companies and their officers submitting timely and accurate filings.

Organisations should consider how existing administrative processes may need to change to ensure real-time filings and if they will continue to maintain their own non-statutory records for internal audit and governance purposes (this may be particularly helpful for larger businesses or those with more complex structures).

Further shareholder transparency measures (including standardised information for the statutory register of members and a one‑off shareholder statement for non‑traded companies) are planned. While timings are yet to be confirmed, businesses should begin reconciling shareholder data for these enhanced requirements. Click here to read more.

‘Appropriate’ registered office and a monitored registered email

Since March 2024, each UK company must maintain an ‘appropriate’ registered office address – one where documents are expected to reach someone acting for the company and delivery can be acknowledged – and keep a monitored registered email address for Companies House communications. PO boxes do not qualify. Where the Registrar identifies a non‑compliant address, it can place the company at a default address and, if not remedied, commence strike‑off.

Overseas groups relying on minimal‑presence or serviced‑office arrangements should confirm they genuinely meet the statutory requirements. Likewise, buyers will need to ensure that the registered email transitions on completion to avoid missing legally significant notices.

Property-holding structures – strengthened register of overseas entities (ROE) regime

ECCTA tightens the ROE regime affecting overseas entities that own UK land or property. Changes include look‑through for nominee arrangements to ultimate beneficial owners, mandatory disclosure of trustees anywhere in the chain, and retrospective reporting for certain pre‑registration periods.

Non‑compliance can prevent registration of property dispositions, so ROE status should be confirmed at the outset of any transaction that is property‑rich or where an overseas vehicle sits in the chain. Likewise, failure to keep information updated can invalidate the overseas entity ID, effectively freezing the ability to manage UK land or property.

Expanded corporate criminal liability regime

Corporate criminal liability has expanded through two significant reforms.

• Broader corporate attribution rules – since 26 December 2023, a company can be liable for economic crime where a senior manager (widely defined by role and influence rather than title) commits the offence within the scope of their authority. This materially increases exposure for overseas parents to misconduct within UK operations and requires renewed focus on decision‑making roles and escalations.
• The new ‘failure to prevent fraud’ offence, in force since 1 September 2025, applies to large organisations. A company may face unlimited fines if an associated person (including UK subsidiaries, employees or agents – even overseas) commits a specified fraud offence for the organisation’s benefit, unless the organisation can demonstrate that it had reasonable fraud prevention procedures.

The regime does not just apply to UK-based businesses. It is enough for an organisation to be caught if any of the elements which are part of the underlying fraud, or any gain or loss occurred in the UK. For example, if an employee commits fraud and the relevant events occurred in the UK, their employer can be prosecuted even if the employee and the organisation are based overseas.

Overseas organisations with UK subsidiaries and branches should assess their fraud‑prevention frameworks, especially where operational oversight is spread across different jurisdictions. Likewise, in M&A, buyers should focus diligence on target governance, investigations history, and senior manager roles, and plan to uplift anti-fraud procedures during post-completion integration.

Future restrictions on corporate directors

Although not yet in force, the government intends to restrict the use of corporate directors, so that only UK entities may act as corporate directors and only where all their underlying directors are natural persons whose identities are verified. Overseas corporate directors will be prohibited. Existing companies will have a fixed transitional period to comply (or remove corporate directors).

Organisations should start assessing whether any changes to board composition may be needed, particularly in groups that use corporate directors across holding structures, and bear in mind the proposed restrictions when considering board appointments over the coming months.

Conclusion

ECCTA marks a major shift in the UK’s expectations of corporate transparency and governance. Overseas groups with a UK footprint should consider obtaining local legal advice to review ownership and governance structures, map senior manager liability, strengthen fraud controls and embed identity verification and Companies House requirements into onboarding and deal processes. Preparation is key to minimise scrutiny, avoid delays and reduce enforcement risk, ensuring overseas companies are well positioned to navigate the UK’s new regulatory landscape.

For a detailed guide on the reforms, including key considerations and how businesses can prepare for the changes, click here.  If you have any concerns about the act or would like to discuss its contents in more detail, please contact our specialist corporate team. We will be monitoring developments and providing further updates in due course.

Please let us know if you would like a copy of our ‘Doing business in the UK guide’, providing an insightful overview of the key legal, commercial and practical issues which need to be carefully considered by companies when entering the UK market to establish a successful new business venture.