Schedules Schedule 7 – Overseas entities: further information for transitional cases
This schedule inserts a new Schedule 6 into the Economic Crime (Transparency and Enforcement Act) 2002 (ECTE Act 2002) which requires overseas entities to deliver to the Registrar further information about events occurring during the period beginning on 28 February 2022 and ending with 31 January 2023.
	Paragraph 2 amends section 16 of the ECTE Act 2022 (verification of registrable beneficial owners and managing officers) to provide that information provided to the Registrar under this Schedule must be verified.
	Paragraph 3 inserts a new section 43A (duty to deliver further information for transitional cases) into the ECTE Act 2022. The new section sets out that new Schedule 6 imposes further duties on overseas entities to deliver information.
	Paragraph 4 inserts Schedule 6 into the ECTE Act 2022, after Schedule 5.
	Sub-paragraph (1) of Paragraph 1 of new Schedule 6 sets out the application of Schedule 6. It applies in relation to an overseas entity if (a) the entity is (i) registered as an overseas entity when new Schedule 6 comes into force, or has been registered as an overseas entity at any earlier time, and (ii) was registered as the proprietor of a relevant interest in land in England and Wales or Scotland at any time during the relevant period; or (b) has committed an offence under paragraph 5 of Schedule 3 or paragraph 10 of Schedule 4 (duty to register as overseas entity in certain transitional cases) to the ECTE Act 2022.
	Sub-paragraph (2) sets out the meanings of the terms used in sub-paragraph (1). For the purposes of sub-paragraph (1), an overseas entity is registered as the proprietor of a relevant interest I land in England and Wales if they are registered in the register of title kept by HM Land Registry under the Land Registration Act 2002 as the proprietor of a qualifying estate as defined in Schedule 4A of that Act. An overseas entity is registered as the proprietor of a relevant interest in land in Scotland if the entity (a) is entered (on or after 8 December 2014) as proprietor of a plot of land registered in the Land Register of Scotland; in relation to a lease that was recorded in the General Register of Sasines, or registered in the Land Register of Scotland before that date is the tenant under the lease by virtue of an assignation of the lease recorded in the Land Register of Scotland on or after 8 December 2014; or is the tenant under a lease that was registered in the Land Register of Scotland on or after that date.
	Sub-paragraph (3) sets out that expressions used in sub-paragraph (2)(b) are to be construed in accordance with section 9(11) and 9(12) of the ECTE Act 2022.
	Sub-paragraph (4) defines the meaning of "the relevant period" for the purposes of new Schedule 6. It means the period beginning with 28 February 2022 and ending with 31 January 2023.
	Paragraph 2 of new Schedule 6 imposes a new duty to deliver statements and information. Sub-paragraph (1) sets out what must be delivered by the overseas entity to the Registrar. The overseas entity must deliver (a) any statements or information required by paragraph 3 (changes in beneficial ownership of overseas entity, paragraph 4 (information about trusts and changes in beneficiaries under trusts, and paragraph 5 (information about changes in trusts in which beneficial owners are trustees); (b) a statement that the entity has complied with paragraph 8 of new Schedule 6, which is a duty to take steps to obtain information; (c) anything required under section 16 of the ECTE Act 2022 (verification) to be delivered to the Registrar; and (d) the name and contact details of an individual who can be contacted about the statements and information provided.
	Sub-paragraph (2) sets out when the information required under new Schedule 6 must be delivered if an overseas entity is registered as an overseas entity when new Schedule 6 comes into force. This is (a) at the same time as it delivers the statements and information required by section 7 (updates) the first time that it is required to deliver such information after the end of the period of three months beginning with the day new Schedule 6 comes into force or (b) if it applies under section 9 for removal before then, at the same time as it delivers the statements and information required by section 9.
	Sub-paragraph (3) provides that if an overseas entity is not registered as an overseas entity when new Schedule 6 comes into force, it must deliver the statements and information required under new Schedule 6 within the period of three months beginning when new Schedule 6 comes into force.
	Paragraph 3 of new Schedule 6 concerns information about changes in beneficial ownership. Sub-paragraph (1) includes a table detailing the statement and information that must be provided. This consists of either a statement that the entity has no reasonable cause to believe that anyone became or ceased to be a registrable beneficial owner during the relevant period (as defined in Paragraph 1(4) of new Schedule 6), or a statement that the entity has reasonable cause to believe that at least one person became or ceased to be a registrable beneficial owner during the relevant period. Where this is the case, the overseas entity must provide the required information (as set out in Schedule 1 of the ECTE Act 2022) about each person who became or ceased to be a registrable beneficial owner during the relevant period (or so much of that information as the entity has been able to obtain), and the date on which each person became or ceased to be a registrable beneficial owner, if the entity has been able to obtain that information.
	Sub-paragraph (2) sets out that where the information provided under sub-paragraph (1) includes information that a registrable beneficial owner by virtue of being a trustee, further information is required to be delivered to the Registrar. The information that must be delivered is (a) the required information about the trust (or so much of that information as the entity has been able to obtain), and a statement as to whether the entity has reasonable cause to believe that there is any information about the trust that it has not been able to obtain.
	Sub-paragraph (3) provides that the statements required to be delivered under Paragraph 2 must relate to the time when they are delivered. The information required under Paragraph 2 as a result of a person having become or ceasing to be a registrable beneficial owner must relate to the state of affairs when the person became or ceased to be a registrable beneficial owner (sub-paragraph (4)).
	The required information is that detailed in Schedule 1 to the ECTE Act 2022 (sub-paragraph (5)).
	Paragraph 4 of new Schedule 6 relates to information about trusts and changes in beneficiaries. Sub-paragraph (1) provides that the overseas entity must deliver to the Registrar either (a) a statement that the entity has no reasonable cause to believe that there is any person who, at the end of the relevant period (as defined in Paragraph 1(4)), was a registrable beneficial owner of the entity by virtue of being a trustee, or (b) a statement that the entity has reasonable cause to believe there is at least one person who was a registrable beneficial owner of the entity by virtue of being a trustee.
	A statement delivered under sub-paragraph (1)(b) must be accompanied by (a) the required information about each trust ("a relevant trust") that led to a trustee being a registrable beneficial owner of the entity at the end of the relevant period, (b) in relation to each relevant trust, a statement stating whether the entity has reasonable cause to believe there is required information about the trust that it has not been able to contain, and (c) in relation to each relevant trust, either the statement described in row 1 of the table in sub-paragraph (3) , or the statement and information described in row 2 of the table in sub-paragraph (3).
	Sub-paragraph (3) contains the table referred to in sub-paragraph (2)(c). The statement in row 1 is a statement that the entity has no reasonable cause to believe that anyone became or ceased to be a beneficiary under the trust during the relevant period. The statement in row 2 is a statement that the entity has reasonable cause to believe that at least one person became or ceased to be a beneficiary under the trust during the relevant period. Where this statement is provided to the Registrar, it must be accompanied by the information set out in row 2. The required information is (1) the information specified in paragraph 8(1)(d) of schedule 1 about each person who became or ceased to be a beneficiary under the trust during the relevant period (or so much of the information as the entity has been able to obtain), and (2) the date on which each person for whom information is provided became or ceased to be a beneficiary under the trust (if the entity has been able to obtain the information).
	Sub-paragraph (4) explains that statements required by paragraph 4 must relate to the time at which they are delivered. Information required by sub-paragraph 2(a) must relate to the state of affairs at the end of the relevant period (sub-paragraph (5)).
	Sub-paragraph (6) provides that information required by sub-paragraph 2(c), required because a person has become or ceased to be a beneficiary under a trust, must relate to the time at which the person became or ceased to be a beneficiary.
	Sub-paragraph (7) clarifies that the required information referred to in paragraph 4 is set out in Schedule 1 to the ECTE Act 2022.
	Paragraph 5 relates to information about changes in trusts of which registrable beneficial owners are (or were) trustees and sets out the information requirements in relation to events in the relevant period (see paragraph 1(4)). Under sub-paragraph (1)(a), the overseas entity must deliver a statement stating that it has no reasonable cause to believe that there is any person who (i) at the end of the relevant period, was a registrable beneficial owner of the entity by virtue of being a trustee of a trust; (ii) at any time during the relevant period was a registrable beneficial owner of the entity by virtue of being a trustee of a different trust; and (iii) at the end of the relevant period was not a registrable beneficial owner of the entity by virtue of being a trustee of the trust mentioned in sub-paragraph (ii), or (b) a statement that the overseas entity has reasonable cause to believe that there is at least one such person.
	Sub-paragraph (2) sets out that where a statement is delivered under sub-paragraph (1)(b), the overseas entity must also deliver further information. This information is (a) the required information about each trust which caused a trustee to be a registrable beneficial owner of the entity at any time during the relevant period, or as much of that information as the entity has been able to obtain, and (b) in relation to each such trust, a statement stating whether the entity has reasonable cause to believe there is required information about the trust that it has not been able to obtain.
	Statements required by paragraph 5 must relate to the time when they were delivered. Information required by sub-paragraph (2)(a) must relate to the state of affairs (a) at the beginning of the relevant period, if the registrable beneficial owner was a trustee of the trust at that time, and (b) otherwise, at the time at which the registrable beneficial owner became a trustee of the trust. (sub-paragraphs (3) and (4)).
	The required information is set out in Schedule 1 (sub-paragraph (5)).
	Paragraph 6 of new Schedule 6 provides that a requirement imposed by paragraphs 2 to 5 of new Schedule 6 may be met (in whole or in part) by confirming information already provided.
	Paragraph 7 of new Schedule 6 applies section 8 of the ECTE Act 2022 (failure to comply with updating duty) to a failure to comply with a duty imposed by paragraphs 2 to 5 of new Schedule 6 as it applies to a failure to comply with section 7 of the ECTE Act 2022.
	Paragraph 8 of new Schedule 6 imposes a duty on the overseas entity to take reasonable steps to obtain the information required to be delivered by Schedule 6 before it complies with paragraphs 2 to 5. The entity must take reasonable steps (a0 to identify anyone who became or ceased to be a registrable beneficial owner during the relevant period, and (b) if it identifies any such person, to obtain (i) the information mentioned in row 2 of column 2 of the table in paragraph 3(1) of Schedule 6, and (ii) in the case of anyone mentioned in paragraph 3(2), the information mentioned there (sub-paragraphs 1 and 2).
	Sub-paragraph (3) imposes a further duty on the entity to take reasonable steps (a) to identify any person who, at the end of the relevant period, was a registrable beneficial owner by virtue of being a trustee of a trust, and (b) if it identifies any such person, to obtain (i) the information set out in paragraph 4(2)(a) about the relevant trust, (ii) information as to whether anyone became or ceased to be a beneficiary under the relevant trust during the relevant period (a "relevant beneficiary"), and (iii) the information mentioned in row 2 of column 2 of the table in paragraph 4(3) of new Schedule 6 in relation to any relevant beneficiary.
	Under sub-paragraph (4), the entity must also take reasonable steps (a) to identify any person falling within paragraph 5(1)(a)(i) to (iii), and (b) if it identifies any such person, to obtain the information set out in paragraph 5(2)(a).
	The steps that the entity must take include giving an information notice under this paragraph to any person that it knows, or has reasonable cause to believe, falls within sub-paragraph (2)(a), (3)(a) or (4)(a). (sub-paragraph (5)). Sub-paragraph (6) provides that an information notice under this paragraph (Paragraph 8) is a notice requiring the recipient to provide the information set out in sub-paragraph (2)(b), (3)(b) or (4)(b).
	Sub-paragraph (7) applies sections 15 to 15B of the ECTE ACT 2022 (offences) in relation to information notices as they apply to information notices under section 12 of the Act.
	Paragraph 9 of new Schedule 6 includes a power to make regulations exempting certain registrable beneficial owners from the requirements of the Schedule. This power cannot be used after the end of the period of two years beginning with the day on which the Act received Royal Assent (sub-paragraphs (1) and (2).
	The Secretary of State must also consult the Scottish Ministers before making regulations under paragraph 9 of Schedule 6 that contain provision that would be within the legislative competence of the Scottish Parliament (sub-paragraph (3).
	Sub-paragraph (4) sets out that regulations made under the power in sub-paragraph (1) are subject to the negative resolution procedure.