The Economic Crime and Corporate Transparency bill is currently making its way through the legislative process, and as part of this, an amendment was tabled which would require both additional information on shareholders to be provided to Companies House, as well as for all shareholders to be able to verify their identities.

When the bill was originally introduced, an impact assessment was carried out which put the net annual direct cost to business arising from the proposed reforms at an estimated £19m. Of this, 75% of the costs were predicted to arise from the introduction of identity verification. With the additional requirements in relation to shareholders, this cost rose to an estimated £154m.

Given that shareholders who own more than 25% of the shares, as well as any shareholders who exercise significant influence or control, are likely to be picked up by virtue of PSC verification requirements, the government has decided not to proceed with the suggested amendment on the basis that it is a disproportionate intrusion. However, it hasn't completely ruled out revisiting transparency of shareholders - but proposes to leave it for now until the ECCT bill has received Royal Assent.