The document discusses the new UK Register of Overseas Entities (ROE) which requires overseas entities that own UK property to register beneficial owners. It outlines the registration requirements, key deadlines, and risks for law firms acting as verification agents for clients registering with the ROE. There are potential legal and reputational risks if firms verify incorrect information. The document provides guidance on systems, controls, and practical steps firms can implement to mitigate risks if they choose to offer verification services to clients under the new ROE regime.

1. © Jonathon Bray Limited
Register of overseas entities –
risks and opportunities for solicitors acting as verification agents
November 2022
with Jonathon Bray, Rachael Eyre, and Lydia Turner

2. The Agenda
• Background to the Register of Overseas Entities (ROE)
• Requirements of the Register of Overseas Entities
• Key dates and deadlines
• Risk implications for law firms acting as verification agents
• Systems and controls to mitigate risk
• Requirements if not acting as a verification agent
• Practical steps
• Round-up and questions
© Jonathon Bray Limited

3. Background to the Register of Overseas
Entities
• Government crackdown on financial
crime
• Russian war/sanctions
• Transparency of ownership
• Economic Crime (Transparency and
Enforcement) Act 2022
• Need to register to buy/sell UK property
• Companies House/HMLR
• BEIS approach of ‘do best’ vs Law Society
warning
© Jonathon Bray Limited

4. Requirements of the Register of
Overseas Entities
The ROE regime applies to an overseas entity that is the registered owner of:
• a freehold estate, or
• a lease granted for a term of more than seven years on or after 1 January 1999
It also applies to an overseas entity that wishes to acquire a qualifying estate.
• Register maintained by Companies House
• All properties owned by entities registered in a foreign country
• All beneficial owners more than 25% where a natural person must be identified and verified
• Verification by a ‘relevant person’
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5. 5 elements of an
Application to the
Register
Jonathon Bray Limited
1. A legal and factual analysis as
to who (if anyone) is a
registrable beneficial owner, a
registrable managing officer or
a registrable trust
2. If there are any registrable
beneficial owners, a legal and
factual analysis as to the nature of
each beneficial owner’s control
and serving notices under section
12 (and possibly section 13) and
allowing up to a month for replies
3. Identity verification
4. Submitting the confirmation
of verification to Companies
House
5. Applying to Companies House
to register the overseas entity

6. Key dates and deadlines
Jonathon Bray Limited
Economic Crime
(Transparency
and Enforcement)
Act 2022 received
royal assent 15th
March 2022
Register
launched
1/8/22
Registration for
all overseas
entities with
existing property
interests must be
complete by 31
January 2023
Backdate to
ownership
from 1/1/99

7. Risk implications for law firms acting as
verification agents
• A person who, without reasonable excuse, delivers (or
causes to be delivered) a document to Companies House
that is misleading, false or deceptive, commits a crime
under the general false statement offence and will be
liable to a fine.
• If the person knows the document is misleading, false or
deceptive, they may also face up to 12 months’
imprisonment.
• Where a firm verifies incorrect information, it may face
adverse reputational and professional conduct
consequences, even where it is not prosecuted for a
criminal offence.
© Jonathon Bray Limited

8. Systems and controls to mitigate risk
• Overall risk assessment for whether or not to
offer the service. If yes, one-off or annual?
• Senior management buy in
• Train staff to identify where this applies
• Mark as high risk – ensure approvals in place
COLP/MLRO or other appropriate
• Policy/process in place that where look to
verify the information, the steps to be taken
• Clear who can verify, what permissions they
need and what information they need in
order to verify
• Ensure satisfied information is true, and
backed up by reliable, appropriate and
independent evidence
© Jonathon Bray Limited

9. Practical Steps
• Set a period for which lawyer should have known the client before verifying
• If not, COLP/Director approval
• COLP Supervision - flag ROE files for the COLP
• Attendance notes and record keeping - complete a full attendance note detailing the
lengths they have gone to in order to complete the verification.
• Retention of documents - material obtained for the purposes of conducting
verification must be held for a period of five years.
• Scope of retainer – ensure the scope of the retainer is set out in the client care
letter, make it clear that the verification is a one-off piece of work and that the firm is
not taking on the responsibility of annual Companies House submissions.
• PII – is it covered?
• Overseas Lawyers – expert in the jurisdiction that the Overseas Entity is registered. If
not, take advice. Fees/disbursements.
• Translations
• Verification period – 3 months valid to submit
• Annual updates – responsibility on the client
• Legal advice – e.g. from a trust lawyer
© Jonathon Bray Limited

10. Requirements if not acting
as a verification agent
Jonathon Bray Limited
Discrepancy reporting - ongoing
Warn that they need to do it and check the register – if not
registered for selling property, can’t act until rectified
Ensure carved out as ‘out of scope of work’ in client care letter
Tell clients need to register where not, or change their
registration
Train staff to be aware
Acting for a client based abroad whether buying or selling
property in the UK– check the Register to see if registered

11. © Jonathon Bray Limited
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12. Resources
HMRC how to register:
https://www.gov.uk/guidance/register-an-overseas-
entity
Law Society Caution Warning:
https://www.lawsociety.org.uk/contact-or-visit-
us/press-office/press-releases/caution-warning-as-
register-of-overseas-entities-comes-into-force
JBL article:
https://www.jonathonbray.com/register-of-overseas-
entities-is-it-too-risky-to-be-a-verification-agent/
© Jonathon Bray Limited

13. © Jonathon Bray Limited
Register of overseas entities –
risks and opportunities for solicitors acting as verification agents
November 2022
with Jonathon Bray, Rachael Eyre, and Lydia Turner