The Heads of Notaries are alerting lawyers to the imminent launch of the Register of Overseas Entities (ROE) which will introduce new responsibilities and risks in certain real estate transactions*.
The UK government announced last week that the new register, created under the Economic Crimes (Transparency and Enforcement) Act 2022, will come into force on August 1.
The President of the Law Society of England and Wales, I. Stephanie Boyce, said: “We have produced an interim note to alert those acting in property transactions involving foreign entities to the changes which are being introduced at pace.
“Failure to register on the ROE is potentially a criminal offence**, so it is important that members are aware of the new register and their responsibilities.
“Parts of the Companies House registration process can be complex, including meeting third-party verification requirements.
“Obtaining the information necessary to obtain registration in the BR may prevent or delay the sending of the application to the HM Land Registry with all the risks that this would entail.
“ROE verification requirements are not the same as the procedures in place to comply with anti-money laundering legislation, provide identification to lenders or the land registry.
“Lawyers are urged to exercise caution when assessing whether they are able to provide such verification.”
The Law Society will soon be releasing more comprehensive guidance on what members should consider when acting in transactions involving foreign entities, including the risks associated with verification.
Notes to Editors
* Beneficial ownership information must be provided to Companies House if you are acting for foreign entities that:
- will buy freehold or leasehold properties or take a new lease of properties which will need to be registered with the HM Land Registry
- already own properties registered with the HM Land Registry; Where
- have since February 28, 2022 sold, loaded or rented a property registered in the HM Land Registry
This beneficial ownership information will then be entered on the new register and registration in the HM Land Registry cannot take place until this has been done.
The Register of Foreign Entities (ROE) also applies to those acting for UK companies buying property from foreign entities.
** Non-compliance is potentially a criminal offense for both the entity and its directors, (subject to mitigating and transitional provisions) punishable by a fine and/or imprisonment.
Read the intermediate note
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