Creating and maintaining an overseas company in the UK
When establishing a physical presence in the UK, overseas organisations should consider how they would prefer the business to be governed, taxed and the reflection on its brand in the UK. Registering as a UK organisation or as an overseas entity both have their advantages, depending on the type of company. plans for growth or organisational structures. This guide lays out the considerations and steps required for registering and maintaining an overseas company in the UK. MSP Company Secretarial can support you throughout the process laid out below.
UK registration vs overseas registration – what are the differences?
Companies incorporated outside the UK intending to have a physical presence in the UK and carry on business in the UK need to be registered. They have two options: they can choose to create and incorporate a subsidiary company in the UK (as a distinct registered company), or they can register as an “overseas company” with a “UK establishment.”
In the latter case, the overseas company retains its overseas incorporation, but it has a registered presence in the UK. This article presents an overview of the requirements of registering as an overseas company and introduces MSP Company Secretarial as a source of advice and guidance that is able to assist with the registration process and support the company in the years that follow.
Incorporating a new limited company in the UK
It may be attractive to an overseas company intending to have a significant ongoing business presence in the UK to incorporate a subsidiary company in the UK. Such incorporation will mean that the new company will be registered under and regulated by the UK’s Companies Act 2006.
Establishing a new business means that it will have limited liability and can operate independently of the parent organisation. A domestic incorporation will likely mean that its Board will be local, with the expertise required for its performance in the UK. It can engage with domestic government and credit facilities, adding to its independence and limiting its exposure to outside events like currency variation and other credit facilities. Future access to the London Stock Exchange and application of UK corporate tax regimes can also be a benefit.
Incorporation is a quick and efficient process in the UK and one that MSP Company Secretarial can certainly undertake, and as an Authorised Corporate Service Provider, we can undertake the ID verifications being introduced by Companies House, making the whole process quick.
Once the company is incorporated, then MSP Company Secretarial can support through ensuring compliance with statutory filings and reporting, provide guidance on corporate governance, and offer full board support services.
Registering an overseas company in the UK – what is required?
The UK’s Companies Act 2006 (the ‘Act’) defines an “overseas company” simply as “a company incorporated outside the United Kingdom” (s. 1044), and Part 34 of the Act sets the framework of obligations for overseas companies to carry on business in the UK, i.e. when the company has some physical presence in the UK. An overseas company having a physical presence in the UK:
- Has a duty to register the company as an overseas company (s. 1046 of the Act) – register the company with the UK’s registrar, Companies House, and file details of its establishment(s). An establishment is a place of business, e.g. an office, where the overseas company carries on its business in the UK, with filing made to the registrar within one month of opening of the establishment.
- Has an ongoing duty to keep all registration details up to date, which includes details for its directors and officers.
- Is required to prepare accounts and reports for the registered overseas company and file these annually with Companies House. The regulations take into account the parent law of the overseas company when it comes to accounts, reports and audit, however, the regulations specify detailed requirements that need to be reported and audited – these are specified in The Overseas Companies Regulations 2009.
- It is worth noting that credit and financial institutions have specific accounts reporting requirements.
- Is required to maintain a register of charges on the company in the UK.
- Is required to register on the Register of Overseas Entities the beneficial owners of an overseas company that owns or intends to acquire UK property (see later).
Some entity types cannot register as an overseas company:
- partnerships
- limited partnerships
- unincorporated bodies
- government agencies
Companies that register as overseas companies in the UK or incorporate a subsidiary in the UK can overlook their statutory filing obligations and ongoing registrations, be that the annual filing of accounts for an overseas company, or the registering of persons with significant control for a UK incorporated company, or maintaining its registration on the Register of Overseas Company in relation to property ownership.
No matter which route an overseas company takes, incorporating a UK subsidiary or registering in the UK as an overseas company with establishments, MSP Company Secretarial can advise and support companies on the requirements of its chosen path, as well as providing full board support to the established entity.
Applying to the Register of Overseas Entities
The Economic Crime (Transparency and Enforcement) Act 2022 (‘ECTEA’) came into force in March 2022, in addition to other matters, “to set up a register of overseas entities and their beneficial owners and require overseas entities who own land to register in certain circumstances”. The regulations include an overseas legal entity that is “a body corporate, partnership or other entity that (in each case) is a legal person under the law by which it is governed”.
It is not possible to explain the requirements ECTEA in this article, however it is important to note that the penalties for failure to comply with the ECTEA are significant (including daily fines in cases of noncompliance) and so any overseas entity needs to give ECTEA careful attention and seek professional advice if it owns property in the UK or intends to acquire property.
How we can help
MSP Company Secretarial is a professional firm providing the full range of company secretary services. We can:
- apply to incorporate companies
- create and maintain the statutory register for companies, overseas companies, and charities
- assist companies with plans to become listed companies
- provide board support services, including minute taking through governance reviews and reporting
- for public companies, arrange, conduct, and officiate at AGMs
- as ACSP, we can verify directors, PSC, and officers IDs with Companies House, or assist with additional verification.
Contact us to discuss how we can support your business.
Overseas Company Registration: Frequently Asked Questions
What is an overseas company?
An overseas company is defined in Companies House guidance as an international organisation that has establishment, i.e. a physical presence in the United Kingdom. The company must register if it “has some degree” of physical presence where it carries on business, but does not need to register if it operates through periodic employee visits or through independent agents.
How long does it take to register an overseas company in the UK?
Registration typically takes between 1 to 3 weeks with Companies House, however this varies greatly from company to company and is very heavily dependent on the complexity of the organisation. MSP Company Secretarial can support by ensuring the process runs smoothly and to your expected timeframe.
Do overseas companies need to appoint a UK-based director or company secretary?
An overseas company registering in the UK is not legally required to appoint a UK-based director, however, having a UK representative and a UK person nominated to receive service on behalf of the overseas entity is very helpful (they can be the same person) Also, the company needs to make annual filings (company accounts) and maintain other filed details (like constitutional documents, and director details) which and so having a UK based company secretarial service to ensure that the company remains compliant is common with overseas company registrations – and MSP Company Secretarial has extensive experience in helping overseas organisations navigate compliance and governance in the UK.