Further Information

Conditions (i) to (v) in more detail

Condition (i) 

For UK companies limited by shares, the first condition should be calculated by looking at the nominal (or par) value of the shares. Any shares which have never been issued or which have been bought back and cancelled should not be included. 

If your company is limited by guarantee or an unlimited company you will need to look at the articles of association to determine if the distribution of profits or capital to the members are allowed. If your company cannot distribute profits or capital to the members then it will have no people who meets condition (i). If the distribution of profits are allowed then any person who has the right to more than 25% of the profits or capital will meet condition (i) and will be a PSC.

Condition (ii) Each share comes with voting rights. Often one share equals one vote, but in some circumstances a company might have different types (classes) of shares with different voting rights. The voting rights attached to each share is normally written in your company's Articles of Association. If a person’s total shares gives him more than 25% voting rights then that person will meet condition (ii) and will be a PSC.

Condition (iii)

If anyone has the right to appoint or remove the majority of the directors in a company (or the management in Partnerships) then that person will be a PSC. If the company does not have a board of directors, for example companies limited by guarantee or charities, then you should consider the appropriate management body, e.g. Committee, Board of Governors, Board of Trustees.

Condition (iv)

A person might not meet the first three conditions but may still be a PSC if they have the right to exercise significant influence or control over the company/partnership. A person might meet this condition if, for example:

  • They have the absolute right to make decisions over the running of the business for example
  • Adopting or amending the company’s business plan;
  • Changing the nature of the company’s business;
  • Making any additional borrowing from lenders;
  • Appointment of removal of the CEO;
  • Establishing or amending profit-sharing, bonus or other incentive scheme of any nature to directors or employees; or
  • The grant of options under a share option or other share based incentive scheme.
  • They are significantly involved in the management and direction of the business;
  • Their Recommendations are always or almost always followed by shareholders;
  • They own important assets or has key relationships that are important to the running of the business (e.g. intellectual property rights) and uses this power to influence the running of the business.

Condition (v)

If your company or partnership is owned or controlled by a trust or firm (without a legal personality, e.g. English Limited Partnerships) then the company must look at whether the trust or firm meets one of the other four conditions. If they do then the PSC would be any of the trustees, beneficiaries, or other persons that has significant control over the trust/firm.

Some examples of what might constitute significant influence or control over a trust of firm are:

  • Right to appoint or remove any of the trustees or partners, except through application to the courts, or as a result of a breach of fiduciary duty by the trustees;
  • Right to direct the distribution of funds or assets;
  • Right to direct investment decisions of the trust or firm;
  • Right to amend the trust or partnership deed; 
  • Right to revoke the trust or terminate the partnership; or
  • Issuing instructions, which are generally followed, as to the activities of the trust or firm.

For more information please see our 'Specialist Areas' page.

Legal entities with corporate owners

If a company is controlled or owned by another legal entity then that legal entity's information must be included in the PSC register if it meets one of the five conditions and 

  1. either keeps its own PSC register or  
  2. has voting shares admitted to trading on a regulated market in the UK or European Economic Area or on specified markets in Switzerland, the USA, Japan or Israel.

For example, UK company A is owned 100% by UK company B. UK company B is owned 100% by person 1. UK company A will be included only UK company B's details in their PSC register and not person 1. Person 1 will be included only in UK company B's register. 

If, for example, UK company A is owned by an overseas company which is listed on a regulated stock exchange then the overseas company will be considered as the beneficial owner and will therefore be entered in the UK company's PSC register. If it is not listed then the beneficial owner or any person with significant control over the overseas company will have to be entered in the PSC register of the UK company. 

For more information about international structure please see our Specialist Areas.

Managers and people with Powers of Attorney

Companies and Partnerships that have managers, or have issued powers of attorney to another person need to consider the rights that have been granted. If a person has significant influence or control, for example has absolute veto rights over decisions relating to the running of the business, then that person may be considered a PSC. 

For more information about what is considered to be ‘significant influence or control’ please see the information about conditions (iv) and (v) above.