Register of Overseas Entities: The final chance to act?
We are now less than two weeks from 31 January 2023, the deadline for overseas entities holding UK land to apply for registration on the UK’s Register of Overseas Entities (ROE).
Those yet to take action should be warned that the verification checks required for registration are onerous and time-consuming, particularly for structures involving trusts. This, coupled with the risks associated with providing verification services (such as those highlighted by The Law Society which have dissuaded the vast majority of law firms), has resulted in a limited number of UK regulated agents applying for agent assurance codes. As a result, the few agents who are carrying out verification checks are now overwhelmed by a bottleneck of applications as we approach the deadline.
The delays are likely to be highly problematic for entities planning to dispose of their interests but currently “in the queue”. From 31 January 2023, they will be prohibited from doing so until they have registered on the ROE and received an Overseas Entity ID, and will no doubt start to feel the pressure from disgruntled counterparties.
The legislation also states that any entity which fails to meet the deadline (and every officer of the entity who is in default) will commit a criminal offence, liable to a fine or imprisonment, or both. However, in light of the current difficulties, there are indications that criminal action will not be brought immediately after the deadline, particularly for those who can demonstrate that they made efforts to comply.
Entities which have taken no action by 31 January 2023 may therefore be most at risk of criminal sanctions. As we enter this final period before the deadline, we highly recommend that entities get in touch for advice on their reporting requirements.