Many Irish companies hold portfolios of property which include UK property. Proposed new regulations in the UK may affect the timing of acquisitions and disposals by such companies.
New regulations are proposed by the UK government which, if implemented, will require the registration of beneficial owners of overseas entities that own UK properties with the following implications:
Overseas entities such as Irish companies will be prohibited from selling their existing properties or creating long leases or charges over the property without compliance with the new regulations.
Overseas entities such as Irish companies buying UK property face the complete reversal of any transaction if they cannot prove compliance at the time they register the land transfer or lease with the Land Registry.
The proposed register would be the first of its kind in the world. A consultation process for feedback ended on 15 May. Here is a link to the Consultation Paper. If implemented it will be important for Irish companies to ensure compliance with the register requirements to avoid issues and delays with property transactions involving UK property.
Update on beneficial ownership register
On a related issue, Irish companies should also bear in mind the rules (in force since 15 November 2016) requiring companies and other legal entities incorporated in Ireland to take all reasonable steps to hold adequate, accurate and current information on their ‘beneficial owners’ on an internal beneficial ownership register. New legislation is expected shortly which will require companies to submit this information on beneficial ownership to a central register to be maintained by the Companies Registration Office (CRO) by October 2017. There will be a six-month grace period in which to file the UBO register without being in breach of the legislation. We will keep you updated on any developments in relation to this new legislation.