Of interest to all working in public or private companies
On 22 February, the Department for Business, Energy and Industrial Strategy (BEIS) published the draft Companies (Disclosure of Address) (Amendment) Regulations 2018 (the draft regulations) with an explanatory memorandum.
The draft regulations have been produced without consultation as BEIS has received serious and concerning complaints about people being put at risk because their home address is publicly available on the Companies House register.
The Companies (Disclosure of Address) Regulations 2009 (SI 2009/214) (the 2009 regulations) do not allow this information to be suppressed and to quote the recent explanatory memorandum: ‘The department considers that the urgency of these cases means it is imperative to act rapidly.’
Despite feedback from companies and their representatives (including ICSA) at the time, the bar for making information about individuals’ residential addresses unavailable to the public was set high in the 2009 regulations – generally that there is a serious risk that the individual concerned, or a person living with them, will be subject to violence or intimidation as a result of the activities of a company with which they are involved.
Moreover, the ‘serious risk of violence or intimidation’ test in the 2009 regulations only relates to the activities of the company. It does not apply if a person is at serious risk of harm in their domestic situation or for wider activities not associated with the company. Neither does it allow individuals who may be at risk from identity theft and fraud to have their residential address suppressed.
New research from Cifas, the fraud prevention organisation, noted that company directors account for roughly 9% of the population but made up 19% of victims of impersonation. There have also been reports that fraudsters are using this publicly available information to pose as company directors to buy products online.
As such, regulation 9 is being amended, allowing an individual whose usual residential address should be on the register to apply to the Registrar of Companies under section 1088 of the Companies Act 2006 to hide that address from the public.
People can do this without applying on any specified grounds and regardless of when the address was placed on the register. This does not only apply to directors, but also to members and former members of a company.
Similarly, regulation 10 is being amended to give a similar ability to companies’ past or present members, and regulation 11 for those who have registered a charge.
Regulation 13 is also being amended so that when there is still a requirement for an applicant’s current address to remain on the register, the usual residential address will be replaced with a service address.
An individual who is not subject to this requirement, such as a former director of a live company, will not need to provide a service address. Instead, their residential address will be partially suppressed to show the first half of the postcode.
There are also other consequential amendments to regulations 12, 13 and 14, as well as to the Limited Liability Partnerships (Application of Companies Act 2006) Regulations 2009, among other things. Public authorities such as the police, the Insolvency Service and The Pensions Regulator will still be able to access directors’ information, such as their personal address.
The government has indicated that the draft regulations will come into force by the end of summer 2018.