Corporate Pension Scheme Trustees – New Requirements

The Economic Crime and Corporate Transparency Act 2023 (the Act) is part of a legislative package to increase corporate transparency, improve the integrity of information filed at Companies House and thereby prevent the abuse of UK corporate structures and tackle economic crime. It makes a wide range of changes to the law governing UK companies. While these changes are not specifically targeted at corporate trustees of pension schemes, they apply to all UK companies and will therefore affect corporate trustees. The changes that are likely to be relevant to corporate trustees are summarised below.

In addition, the government plans to introduce restrictions on the use of corporate directors alongside the changes introduced by the Act. These restrictions may also affect corporate trustees and are summarised below.

Identity verification

The Act introduces a requirement for directors, persons with significant control (PSCs) and any employees or officers (e.g. the company secretary or management) filing documents at Companies House on behalf of a company to have their identity verified. Individuals will be prohibited from acting as a director unless their identity has been verified and companies will be under an obligation to ensure that individuals do not act as a director unless their identity has been verified. Breach of these requirements will be an offence punishable by a fine, but the director’s appointment and their actions as director will not be invalidated.

Individuals will be able to verify their identity in two ways:

• Directly with Companies House.
• Using an “authorised corporate services provider” (ACSP) such as a company secretarial services provider. (Many of the company secretarial service providers have indicated that they intend to register as an ACSP as soon as possible.)

Companies House has issued guidance for individuals on verifying their identity. Once an individual’s identity has been verified, they will not be required to verify it again (save in extremely limited circumstances).

The government currently expects to implement the identity verification requirements as follows:

• From 8 April 2025, individuals will be able to verify their identity voluntarily.
• From autumn 2025, all new directors and PSCs will be required to verify their identity and a 12 month transition period will begin during which existing directors and PSCs will be required to verify their identity as part of the annual confirmation statement filing process.
• From spring 2026, anyone filing a document at Companies House on behalf of a company will be required to verify their identity (unless they are an ACSP or an employee or officer of an ACSP).

Company records and filings

The Act makes changes to the records that UK companies are required to maintain and to the information that UK companies are required to file at Companies House. These include the following:

• Minor changes to the content of the annual confirmation statement. These changes came into force on 4 March 2024 and apply to confirmation statements filed on or after that date.

• Replacement of the requirement to maintain registers of directors, directors’ residential addresses, secretaries and PSCs with a requirement to notify certain information about directors, secretaries and PSCs, and any changes to that information, to Companies House within 14 days. Failure to comply with these obligations without reasonable excuse will be an offence punishable by a fine. In addition, if the requirement to notify the appointment of a director is not complied with, the individual will be prohibited from acting as director until the notification has been made. Breach of this prohibition is an offence punishable by a fine, but the director’s appointment will not be invalidated. In practice, it is possible that future appointments of directors will be made conditional upon notification of the appointment being filed at Companies House.
• Changes to the information that companies must hold in their register of members and removal of the option for private companies to elect to keep information about their members on a central register rather than in a company register.
• A requirement for companies to provide a one-off statement of member information to Companies House. This statement is to be provided with the first confirmation statement to be delivered after the requirement comes into force.
• Changes to the accounts filing requirements for micro-entities and small companies and to the requirements that must be met by dormant companies claiming an audit exemption.

The government has not yet confirmed when these changes will come into force.

New failure to prevent fraud offence

The Act introduces a new offence of failure to prevent fraud from 1 September 2025. Generally, this offence will only apply to “large organisations”, and corporate trustees of pension schemes will almost certainly not fall within the definition of a “large organisation”. The Act does include a provision whereby a subsidiary of a large organisation can be prosecuted where an employee of the subsidiary commits a fraud intending to benefit the subsidiary. In theory, this could bring corporate trustees which are a subsidiary of a company (or corporate group) that is a large organisation within the offence’s scope. However, in our experience, corporate trustees do not have employees and are therefore unlikely to fall within the offence’s scope.

Corporate directors

On a separate, but related note, the government has confirmed that it plans to exercise its powers under the Small Business, Enterprise and Employment Act 2015 to restrict the use of corporate directors (i.e. companies acting as directors of other companies). It is not unusual for professional independent trustee companies to be appointed as a corporate director.

A company will only be allowed to act as a corporate director if all its directors are natural persons who have had their identity verified. We expect most corporate directors of pension scheme trustee companies will be able to verify their directors’ identities so as to meet these requirements. The government has not yet confirmed when the restrictions will be brought in. However, when it does come into force, companies with existing corporate directors will be given 12 months to comply.

What should corporate pension scheme trustees be doing?

You should speak to your company secretarial services provider (or whoever normally carries out your company filings) to confirm that they are aware of the changes and that steps will be taken to ensure compliance with the new requirements by the trustee company and its directors.

Where the trustee company has a corporate director, you should check whether it expects to be able continue to act as a corporate director once the restrictions on corporate directors come into force.