ProSec CEO Max Gower
Setting up a company in the UK has long been absurdly easy. You can do it online in under 10 minutes. No real checks. No proper verification. In fact, until now, it’s been easier to incorporate a business than to open a bank account. I’m always surprised at the hoops I have to jump through to transfer money to a friend, yet I could set up a business in a flash.
That speed has often been held up as a sign of how business-friendly the UK is. But there’s been a darker side to that simplicity. Our system, praised for being light touch, has in reality become a haven for bad actors. Fake identities, nominee directors and layers of obfuscation have made it easy for fraudsters to hide behind corporate veils. It’s a joke about how many ‘Donald Ducks’ run businesses in the UK, but as well as being a humorous anecdote it’s one of the reasons why the UK has been repeatedly flagged as a jurisdiction vulnerable to economic crime.
So, the news that Companies House is finally tightening its rules is both welcome and overdue. The introduction of identity verification, enhanced oversight and stricter filing requirements mark a major shift in how company formation and administration will work from now on.
But the big question isn’t whether reform is necessary, but whether the system and the professionals who work within it are ready.
WHAT’S CHANGING – AND WHY IT MATTERS
The cornerstone of the Economic Crime and Corporate Transparency Act is identity verification. Directors and those with significant control over a company will, for the first time, need to prove they are who they say they are. That alone will make it significantly harder to hide behind layers of false ownership.
Alongside this, Companies House will gain new powers to scrutinise and reject incorrect or suspicious filings, and to penalise those who don’t comply. For anyone who’s worked in corporate services, this is a huge change in tone as Companies House has traditionally operated more like a passive registry than a regulator.
This is a move that brings the UK in line with the standards you’d expect in other major economies. It helps protect honest businesses. It makes our corporate landscape more trustworthy. And it shows a willingness to take economic crime seriously. It will still mean that in the UK it is pretty easy to set up a business compared to other countries, so let’s not pretend it’s full of red tape. In Italy and Germany, for example, potential business owners have to go before a notary, with more legal requirements than in the UK.
There will be practical implications as this added scrutiny comes added responsibility – and not everyone is set up to manage it.
WHAT IT MEANS FOR LAW FIRMS AND ACCOUNTANTS
Historically, law firms and accountancy practices have often taken care of company secretarial work as part of a wider service offer. It’s been seen as fairly routine – a useful extra, but rarely the core focus or what they actually want to be doing. Now that this work is becoming regulated, the risks associated with getting it wrong have increased.
This puts pressure on smaller firms in particular. To continue offering company secretarial services, they’ll need to meet the new requirements, including identity verification, anti-money laundering checks and ongoing due diligence. That means investing in the right systems, training staff and possibly becoming authorised themselves. For many firms, the cost of doing that simply won’t stack up. And that’s where Authorised Corporate Service Providers (ACSPs) who focus on company secretarial work come in.
THE RISE OF ACSPS
Under the new regime, filings at Companies House will only be accepted from individuals who have verified their identity or through registered ACSPs. This is a significant shift in how company administration will function.
ACSPs are not just filing agents. They’re regulated entities, responsible for carrying out checks, verifying identities, ensuring filings are accurate and keeping up with regulatory changes. In other words, this is a professional service in its own right – not just an add-on.
We’ve spent the last eight years helping firms navigate this space. We’ve built systems that ensure filings are correct, verifications are robust and that everything we do is documented and defensible. We’ve also seen how many firms want to step back from this work, not because they can’t do it, but because they don’t want to carry the risk.
And that risk is only going to grow. It’s one thing to offer a bit of help with Companies House filings when no one’s paying much attention. But when that same task can lead to penalties, investigations or reputational damage, the equation changes.
WHAT’S NEEDED TO MAKE THE REFORM WORK
The legislation is in place, but many worry it may end up being another well-meaning reform that falls flat in practice.
To make sure it does not fail there are three areas we need to get right.
First, clear guidance. Firms and ACSPs need to know exactly what’s expected of them. That includes technical detail about how verification will work, what documentation is required, and how Companies House will handle discrepancies. Vague guidance creates confusion – and in regulated work, confusion leads to mistakes.
Then, credible enforcement. Companies House needs the resources and authority to follow through. One of the reasons the old system failed is because the penalties for misuse were so rarely applied. If this reform is going to restore trust, we need to see consistent, fair enforcement – especially in the early stages.
And finally, better partnerships. For law firms and accountants who decide not to continue offering company secretarial work, the key will be finding trusted ACSPs to partner with. The best relationships will be collaborative, not transactional.
They will be built on mutual understanding, clear communication, and shared standards.
A CHANCE TO RAISE THE STANDARD
This reform is not just about closing the door on bad practice. It’s a chance to raise the standard across the board.
Handled well, it can create better relationships between clients and firms, stronger collaboration between different professional disciplines and a cleaner, more trustworthy business environment for everyone. It might even help rebuild some of the UK’s reputation as a reliable place to do business – something we can’t afford to lose if we want to truly become an economic powerhouse.
It will also force firms to ask hard questions. Is this work still viable in-house? Are we set up to do it properly? Do we have the right systems, the right people and the right appetite for risk? If not, what does a good partnership look like?
The firms that take the time to answer those questions now will be the ones best placed to both navigate the change and to support their clients through it.
The UK’s new approach to company registration is a much-needed correction. For too long, we’ve prized speed and simplicity over scrutiny and security. That’s changing – and rightly so.
But reform doesn’t end with legislation. It only works if the people involved are ready to adapt. For some, that means building internal systems and taking on the new responsibilities themselves. For others, it means finding the right partner and letting go.
Either way, this is a chance to reset. To bring clarity, accountability, and professionalism to a part of the legal and business world that’s been overlooked for too long.
