Economic Crime and Corporate Transparency Act 2023 Explained

Key Provisions of The Economic Crime and Corporate Transparency Act 2023

The Act received Royal Assent on 26 October 2023, with its Companies House reforms being introduced in phases from March 2024 onwards. It expanded the powers of Companies House, the official registrar of companies, to improve the accuracy of the register and tackle misuse during company formation and operation.

The Role of Companies House in Company Formations

As the UK’s official registrar of companies, Companies House plays a central role in maintaining a transparent and trustworthy business environment. Legislative reforms under the ECCTA 2023 are to help combat economic crime and improve the accuracy of company data on the public register.

Among its new responsibilities are:

• Powers to query and challenge information on the register that appears to be incorrect or inconsistent.
• The authority to require identity verification for company officials, including directors and persons with significant control (PSCs).
• Enhanced powers to enforce the accuracy of the register by confirming or rejecting appointments and filings involving key individuals.
• Greater powers to remove factually inaccurate information from the Companies House register.
• The power to increase company formation fees to support the implementation and enforcement of these new regulatory measures.

Changes to Confirmation Statements Under the ECCTA

The Act has introduced the following updates to the confirmation statement process to enhance transparency and regulatory compliance.

• Registered Email Address: From 5 March 2024, all existing companies must include a registered email address in their confirmation statement. This ensures Companies House can maintain direct contact with each business.
• Statement of Lawful Purpose: Companies are now required to confirm that their intended business activities are lawful by including a statement of lawful purpose in their confirmation statement.
• Shareholder Transparency: A future requirement will require companies to provide the full names of their shareholders and submit a complete shareholder list to Companies House once. Companies House has not yet announced when this requirement will take effect.

Company Name Requirements

Under the ECCTA 2023, Companies House has been granted expanded powers to reject company names that do not meet new compliance standards. These include names:

• That contain or consist of computer code.
• Created with the intention to facilitate fraud or deception.
• Likely to give a false impression of connection to foreign governments or international organisations.

These new powers build on the existing company naming rules already established under the Companies Act 2006, strengthening the UK’s efforts to prevent misuse of company names and protect the integrity of the public register.

See also: Company Name Check Tool Explained

Registered Office Address Requirements

The Economic Crime and Corporate Transparency Act 2023 introduced new registered office address requirements from 4 March 2024. A registered office must be a physical UK address in the same jurisdiction as the company and must be an appropriate address; a Royal Mail PO Box or similar service cannot be used.

Changes to Companies House Fees

Companies House increased many of its fees on 1 May 2024 and introduced further fee changes on 1 February 2026. The increases help fund Companies House and Insolvency Service activities connected with implementing and enforcing reforms under the Economic Crime and Corporate Transparency Act 2023.

Here is a comparison of the key service fees before and after the increase:

Changes to Limited Partnerships

The ECCTA provides for further registration and reporting requirements for limited partnerships, but these reforms have not yet been fully implemented. Companies House currently expects the main limited partnership reforms to take effect no earlier than the end of 2026.

Once implemented, limited partnerships will need to:

• Provide specified information about their partners, including names, dates of birth and usual residential addresses.
• Provide a registered office address in the UK and in the same jurisdiction in which the limited partnership is registered.
• Provide a Standard Industrial Classification (SIC) code.
• File an annual confirmation statement.
• File information through an Authorised Corporate Service Provider registered with Companies House.

These measures require secondary legislation before they can be implemented.

Identity Verification Requirements to Improve Transparency of Company Ownership

Voluntary identity verification opened on 8 April 2025, before mandatory identity verification for new directors and PSCs began on 18 November 2025. This new requirement goes beyond the traditional Anti-Money Laundering (AML) checks carried out by company formation agents and service providers.

Current identity verification requirements apply to:

• Directors and people with significant control (PSCs).
• Members of limited liability partnerships (LLPs).
• Individuals applying to register as an Authorised Corporate Service Provider (ACSP).

Accountants and solicitors are not automatically required to verify simply because they act for a company. Further identity verification requirements for limited partnerships, corporate directors, corporate LLP members, officers of corporate PSCs and people who file information will be introduced separately. By linking official documents and live facial verification, this process helps prevent the use of false identities, discourages fraudulent company formations, and promotes greater transparency around company ownership.

These changes form part of a broader strategy under the Economic Crime and Corporate Transparency Act 2023, which aims to make the UK a safer and more trusted place to do business.

Compulsory Identity Verification From 18 November 2025

Voluntary verification opened in April 2025, but from 18 November 2025 identity verification became a compulsory part of incorporating a company, appointing new directors and registering new PSCs.

Existing directors must provide their personal code when the company files its next confirmation statement during the transition period. PSC deadlines depend on the individual’s role: existing PSCs who are also directors of the same company have a separate 14-day period beginning the day after the company’s confirmation statement date, while existing PSCs who are not directors must provide their personal code within the first 14 days of their birth month.

Verification is done through GOV.UK One Login or an Authorised Corporate Service Provider. Failure to comply with identity verification requirements may result in an offence and financial penalties or fines.

Economic Crime and Failure to Prevent Fraud Offences

The Failure to Prevent Fraud Offence holds large organisations criminally liable if an employee or agent commits fraud for the organisation’s benefit and the organisation did not have reasonable fraud prevention procedures in place. It applies even if senior management does not know about or approve of fraudulent activity.

This offence is designed to close existing loopholes and encourage businesses to proactively implement strong fraud prevention measures. If convicted, companies may face unlimited fines.

It applies to large companies, partnerships, and not-for-profit bodies that meet at least two of the following criteria:

• Over 250 employees
• More than £36 million in turnover
• More than £18 million in total assets

It also applies across the UK and can include overseas companies if UK victims are involved. Individual directors will not be held liable under this offence, but they can still be prosecuted under other fraud laws.

The offence came into force on 1 September 2025, and the Home Office has published guidance on reasonable fraud prevention procedures for organisations in scope.