UK government consultation begins on wider access to information on trusts that own land

Monday, 08 January 2024
The UK government is consulting on widening public access to trust information held on the Register of Overseas Entities (ROE), in order to increase the transparency of land ownership when trusts are involved in the ownership structure.
Magnifying glass over documents

The ROE was launched last year under the direction of Companies House. Anonymous foreign owners of UK property must reveal their real identities to the register, or lose the ability to conduct property transactions such as sales, leases or mortgages. More than 30,000 foreign entities have now registered on the ROE, and Companies House says it plans to 'rigorously enforce compliance' so that ownership transparency is maintained and further enhanced.

However, transparency campaigners consider that the use of trusts to hold land is being misused to defeat this object. HM Land Registry's public register does not show details of persons behind the legal owner who may be able to control or derive economic benefit from land. Trust information held in the ROE is sent to Companies House in the expectation that the data will only be accessed by law enforcement and other relevant public agencies. However, the Economic Crime and Corporate Transparency Act 2023 provides a power for the government to make regulations granting access to trust data on application, in circumstances to be detailed in regulations.

The consultation, which is open until 21 February, will feed into this process. It is being held jointly by the Department for Levelling Up, Housing and Communities; HM Revenue and Customs (HMRC); HM Treasury; and the Department for Business and Trade. The proposals aim to 'lift the veil of secrecy' from trusts that hold land, said housing secretary Michael Gove. 'Transparency about land ownership is crucial if we want to make our housing and land markets fairer', he said. It would help resolve housing sector issues, such as helping community groups and businesses to take on underused or unused properties; ascertaining liability for historical remediation costs; enforcement against rogue landlords in the private rental sector; and helping local authorities enforce their rights.

Comments are invited on three possible options. One is that data identifying the beneficial owners of land held by trusts would be public by default, subject to 'safeguards' to prevent criminal use of the information.

A second option is to make partial information about trusts publicly available by default, supposedly to address any 'real or perceived risks' of making all trust information publicly accessible by default. The government recognises that many trusts are set up to hold property for children or other persons who do not have capacity to hold it themselves, and revealing the identity of these beneficiaries could put them at risk.

The third option is to leave the ROE public access rules as they are, albeit with some additional powers introduced by the Levelling Up and Regeneration Act 2023.

The government also wants to hear comments on extending the transparency of land held by trusts that are not associated with overseas entities.

STEP's UK Technical Committee will respond to the consultation.

Sources

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