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New Requirements For Irish Entities With Real Estate Interests In The UK – Real Estate



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Irish entities that own, plan to acquire, or plan to create
security over UK real estate should take advice on whether they are
subject to the new UK requirement to register with, and provide
information on their beneficial owners to, Companies House. Lenders
to in-scope Irish entities also need to be aware of the new
requirements.

The Economic Crime (Transparency and Enforcement) Act 2022
established the UK
Register of Overseas Entities
which came into force on 1 August
2022 and is operated by the Companies House. Overseas entities that
hold certain real estate interests in the UK are required to
register with the Companies House and to file information regarding
their beneficial owners.

An “overseas entity” is a legal
entity that is governed by the law of a country or territory
outside the UK and includes Irish companies and bodies corporate
(such as ICAVs).

The registration requirement applies where an
overseas entity” holds a
qualifying estate“. In respect of
England and Wales, this means a freehold estate in land or a
leasehold estate in land granted for a term of more than seven
years from the date of grant. The scope of the ownership trigger
varies slightly where the real estate located in Scotland or in
Northern Ireland.

Any overseas entity that holds a qualifying estate (acquired
within specified timeframes) or that has disposed of a qualifying
estate since 28 February 2022, is required to register with the
Companies House by 31 January 2023. From 5
September 2022
, any overseas entity that wishes to be
registered as the owner of a qualifying estate with HM Land
Registry must register in advance with the Companies House.

Prior to registration, an overseas entity is obliged to take
reasonable steps to identify its “registerable
beneficial owners
” and to submit details with its
application. Once an overseas entity has registered, it will
receive an Overseas Entity ID from the Companies House (which it
will need to provide to HM Land Registry each time that it buys,
sells, transfers, leases or charges a qualifying estate). It will
also have a duty to update the register on an annual basis if the
information recorded in respect of it has changed.

Irish corporates holding UK real estate should review the new
requirements carefully to check whether they are in-scope, review
the Guidance from Companies House and take
appropriate steps to register. Lenders financing the acquisition of
UK real estate by a non-UK entity, or taking security over UK real
estate from a non-UK entity, will need to check whether that entity
is in-scope and, if it is, whether it has registered with Companies
House and received an Overseas Entity ID.

Failure by an overseas entity to comply with the registration
and updating requirements is a criminal offence.

This article contains a general summary of developments and
is not a complete or definitive statement of the law. Specific
legal advice should be obtained where appropriate.

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