SCHEDULE 3 Land ownership and transactions: England and Wales
Section 33(1)
PART 1 Amendments to Land Registration Act 2002
1 The Land Registration Act 2002 is amended as follows.
2 After section 85 insert—
Overseas entities
Overseas entities
85A Schedule 4A is about the ownership of registered land by overseas entities and about registrable dispositions made by them.
3 After Schedule 4 insert—
SCHEDULE 4A
Overseas entities
Section 85A
Meaning of “qualifying estate”
1 In this Schedule “qualifying estate” means—
(a) a freehold estate in land, or
(b) a leasehold estate in land granted for a term of more than seven years from the date of grant.
Registration
2 No application may be made to register an overseas entity as the proprietor of a qualifying estate unless, at the time of the application, the entity—
(a) is a registered overseas entity, or
(b) is an exempt overseas entity.
Restrictions on disposal
3 (1) The registrar must enter a restriction in the register in relation to a qualifying estate if satisfied that—
(a) an overseas entity is registered as the proprietor of the estate, and
(b) the entity became registered as the proprietor in pursuance of an application made on or after 1 January 1999.
(2) The restriction must prohibit the registration of any disposition within section 27(2)(a), (b)(i) or (f) unless—
(a) the entity is a registered overseas entity, or is an exempt overseas entity, at the time of the disposition,
(b) the disposition is made in pursuance of a statutory obligation or court order, or occurs by operation of law,
(c) the disposition is made in pursuance of a contract made before the restriction is entered in the register,
(d) the disposition is made in the exercise of a power of sale or leasing conferred on the proprietor of a registered charge or a receiver appointed by such a proprietor,
(e) the Secretary of State gives consent under paragraph 5 to the registration of the disposition, or
(f) the disposition is made by a specified insolvency practitioner in specified circumstances.
(3) In sub-paragraph (2), in paragraph (f)—
“specified circumstances” means circumstances specified in regulations made by the Secretary of State for the purposes of that paragraph;
“specified insolvency practitioner” means an insolvency practitioner of a description specified in regulations made by the Secretary of State for the purposes of that paragraph.
Registrable dispositions by overseas entity entitled to be registered (but not registered)
4 (1) This paragraph applies where—
(a) an overseas entity is entitled to be registered as the proprietor of a qualifying estate,
(b) the overseas entity became entitled to be registered as the proprietor of that estate on or after the day on which this paragraph comes into force, and
(c) the entity makes a registrable disposition within section 27(2)(a), (b)(i) or (f).
(2) The disposition must not be registered unless—
(a) the entity is a registered overseas entity, or is an exempt overseas entity, at the time of the disposition,
(b) the disposition is made in pursuance of a statutory obligation or court order, or occurs by operation of law,
(c) the disposition is made in pursuance of a contract made before the overseas entity became entitled to be registered,
(d) the disposition is made in the exercise of a power of sale or leasing conferred on the proprietor of a registered charge or a receiver appointed by such a proprietor,
(e) the Secretary of State gives consent under paragraph 5 to the registration of the disposition, or
(f) the disposition is made by a specified insolvency practitioner in specified circumstances.
(3) In sub-paragraph (2)(f) “specified circumstances” and “specified insolvency practitioner” have the meanings given by paragraph 3(3).
Consent to registration of dispositions that cannot otherwise be registered
5 (1) The Secretary of State may consent to the registration of a disposition that would otherwise be prohibited by a restriction entered under paragraph 3, or by paragraph 4, if satisfied—
(a) that at the time of the disposition the person to whom it was made did not know, and could not reasonably have been expected to know, of the prohibition, and
(b) that in all the circumstances it would be unjust for the disposition not to be registered.
(2) The Secretary of State may by regulations make provision in connection with applications for consent, and the giving of consent, under sub-paragraph (1).
(3) The regulations may, for example, make provision about—
(a) who may apply;
(b) evidence;
(c) time limits.
Making dispositions that cannot be registered
6 (1) An overseas entity must not make a registrable disposition of a qualifying estate if, disregarding the possibility of consent under paragraph 5, the registration of the disposition is prohibited by—
(a) a restriction entered under paragraph 3, or
(b) paragraph 4.
(2) If an overseas entity breaches sub-paragraph (1) an offence is committed by—
(a) the entity, and
(b) every officer of the entity who is in default.
(3) Nothing in this paragraph affects the validity of a disposition made in breach of sub-paragraph (1).
(4) Sections 1121 to 1123 of the Companies Act 2006 (liability of officers in default: interpretation etc.) apply for the purposes of this paragraph as they apply for the purposes of provisions of the Companies Acts.
(5) In those sections as applied, a reference to an officer includes a person in accordance with whose directions or instructions the board of directors or equivalent management body of an overseas entity are accustomed to act.
(6) A person is not to be regarded as falling within sub-paragraph (5) by reason only that the board of directors or equivalent management body acts on advice given by the person in a professional capacity.
(7) A person guilty of an offence under this paragraph is liable—
(a) on summary conviction, to imprisonment for a term not exceeding the maximum summary term for either-way offences or a fine (or both);
(b) on conviction on indictment, to imprisonment for a term not exceeding 5 years or a fine (or both).
(8) In sub-paragraph (7)(a) “the maximum summary term for either-way offences” means—
(a) in relation to an offence committed before the time when paragraph 24(2) of Schedule 22 to the Sentencing Act 2020 comes into force, 6 months;
(b) in relation to an offence committed after that time, 12 months.
(9) Proceedings for an offence under this may only be brought by or with the consent the Secretary of State or the Director of Public Prosecutions.
Interpretation etc.
7 In this Schedule—
“exempt overseas entity” means an overseas entity of a description specified in regulations under section 34(6) of the Economic Crime (Transparency and Enforcement) Act 2022;
“overseas entity” has the meaning given by section 2 of the Economic Crime (Transparency and Enforcement) Act 2022;
“qualifying estate” has the meaning given by paragraph 1;
“register of overseas entities” means the register kept under section 3 of the Economic Crime (Transparency and Enforcement) Act 2022;
“registered overseas entity” means an overseas entity that is registered in the register of overseas entities (but see paragraph 8).
8 (1) For the purpose of this Schedule, an overseas entity that fails to comply with the duty in section 7 of the Economic Crime (Transparency and Enforcement) Act 2022 (updating duty) is not to be treated as being a “registered overseas entity” until it remedies the failure.
(2) For the purpose of sub-paragraph (1), an overseas entity “remedies” the failure when it delivers the statements and information mentioned in section 7(1)(a), (b) and (c) of the 2022 Act.
4 In section 128 (regulations), in subsection (4)—
(a) omit the “or” at the end of paragraph (b);
(b) at the end of paragraph (d) insert
, or
(e) regulations under paragraph 3(3) or 5(2) of Schedule 4A.
PART 2 Transition: qualifying estates registered pre-commencement
Duty of proprietor to register as an overseas entity within transitional period
5 (1) An overseas entity, and every officer of the entity who is in default, commits an offence if—
(a) at the end of the transitional period, the entity—
(i) is the registered proprietor of a qualifying estate, but
(ii) the entity is not registered as an overseas entity, has not made an application for registration as an overseas entity that is pending and is not an exempt overseas entity, and
(b) the entity became the registered proprietor of that qualifying estate in pursuance of an application made on or after 1 January 1999 but before the commencement date.
(2) A person guilty of an offence under this paragraph is liable—
(a) on summary conviction, to imprisonment for a term not exceeding the maximum summary term for either-way offences or a fine (or both);
(b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine (or both).
(3) In sub-paragraph (2)(a) “the maximum summary term for either-way offences” means—
(a) in relation to an offence committed before the time when paragraph 24(2) of Schedule 22 to the Sentencing Act 2020 comes into force, 6 months;
(b) in relation to an offence committed after that time, 12 months.
(4) In this paragraph “exempt overseas entity” means an overseas entity of a description specified in regulations under section 34(6).
(5) Nothing in this paragraph limits the power to give a notice under section 34 at any time.
Registrar’s duty to enter restriction in relation to qualifying estate
6 (1) This paragraph applies where the Chief Land Registrar is satisfied that—
(a) an overseas entity is the registered proprietor of a qualifying estate, and
(b) the entity became the registered proprietor of that estate in pursuance of an application made before the commencement date.
(2) The Chief Land Registrar must comply with the duty to enter a restriction under paragraph 3 of Schedule 4A to the Land Registration Act 2002 (inserted by Part 1 of this Schedule) in relation to the estate as soon as reasonably practicable and in any event before the end of the transitional period.
(3) But the restriction does not take effect until the end of the transitional period.
Interpretation
7 In this Part of this Schedule—
“the commencement date” means the day on which section 3(1) comes fully into force;
“registered proprietor”, in relation to a qualifying estate, means the person entered as proprietor of the estate in the register of title kept by the Chief Land Registrar;
“qualifying estate” has the meaning given by paragraph 1 of Schedule 4A to the Land Registration Act 2002;
“the transitional period” has the meaning given by section 41(10).
SCHEDULE 4 Land ownership and transactions: Scotland
Section 33(2)
PART 1 Amendments
Conveyancing (Scotland) Act 1924
1 (1) Section 4A of the Conveyancing (Scotland) Act 1924 (completion of title by registration of notice of title in Land Register of Scotland) is amended as follows.
(2) The existing text becomes subsection (1).
(3) After that subsection insert—
(2) Subsection (1) is subject to paragraphs 3 and 4 of schedule 1A to the Land Registration etc. (Scotland) Act 2012.
Land Registration etc. (Scotland) Act 2012 (asp 5)
2 The Land Registration etc. (Scotland) Act 2012 is amended as follows.
3 In section 21 (application for registration of deed)—
(a) in subsection (4), after “45(5)” insert “and paragraphs 1 to 5 of schedule 1A”, and
(b) after that subsection insert—
(5) Schedule 1A makes provision about certain land transactions involving overseas entities.
4 In section 27 (application for voluntary registration), after subsection (4) insert—
(4A) Subsection (3) is subject to paragraph 6 of schedule 1A.
5 In section 46 (the title of which becomes “Meaning of “disposition” in certain provisions”)—
(a) after “48” insert “and schedule 1A”, and
(b) after “sections” insert “or that schedule”.
6 The italic heading before section 112 becomes “Offences”.
7 After section 112 insert—
Offence by overseas entity
112A (1) An overseas entity must not deliver to a person a qualifying registrable deed granted by the overseas entity if (disregarding the possibility of consent under paragraph 7(2) of schedule 1A) by virtue of paragraph 2 of schedule 1A the Keeper would be required to reject an application under section 21 for registration of the deed.
(2) A qualifying registrable deed is to be treated as having been granted for the purposes of subsection (1) even if at the time when it is delivered it has been executed by the overseas entity only.
(3) If an overseas entity breaches subsection (1), an offence is committed by—
(a) the entity, and
(b) every officer of the entity who is in default.
(4) Nothing in this section affects the validity of a qualifying registrable deed delivered in breach of subsection (1).
(5) A person guilty of an offence under subsection (3) is liable—
(a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum (or both);
(b) on conviction on indictment, to imprisonment for a term not exceeding 5 years or a fine (or both).
(6) Sections 1121 to 1123 of the Companies Act 2006 (liability of officers in default: interpretation etc.) apply for the purposes of this section as they apply for the purposes of provisions of the Companies Acts.
(7) In those sections as applied, a reference to an officer includes a person in accordance with whose directions or instructions the board of directors or equivalent management body of an overseas entity are accustomed to act.
(8) A person is not to be regarded as falling within subsection (7) by reason only that the board of directors or equivalent management body acts on advice given by the person in a professional capacity.
(9) In this section—
“overseas entity” has the meaning given by section 2 of the Economic Crime (Transparency and Enforcement) Act 2022;
“qualifying registrable deed” means a registrable deed which is—
a disposition;
a standard security;
a lease;
an assignation of a lease.
8 In section 116(2) (orders and regulations subject to the negative procedure)—
(a) for “sections”, in the first place it occurs, substitute “provisions”, and
(b) after paragraph (h) insert—
(i) paragraph 2(5) or 7(5) of schedule 1A.
9 After schedule 1 insert—
SCHEDULE 1A
Land transactions: overseas entities
Section 21
Cases where Keeper must reject application under section 21
1 (1) This paragraph applies where—
(a) a person applies under section 21 for registration of a qualifying registrable deed, and
(b) if the application is accepted by the Keeper—
(i) the name of an overseas entity would be entered as proprietor in the proprietorship section of the title sheet of a registered plot of land, or
(ii) an overseas entity would be the tenant under a registered lease.
(2) The Keeper must reject the application unless the overseas entity is—
(a) a registered overseas entity, or
(b) an exempt overseas entity.
(3) Sub-paragraph (2) does not apply where—
(a) the application is made by a person other than the overseas entity referred to in sub-paragraph (1)(b)(i), and
(b) the deed in respect of which the application is made is a lease or an assignation of a lease the subjects of which consist of or form part of an unregistered plot of land of which that overseas entity is the proprietor.
2 (1) This paragraph applies where—
(a) a person applies under section 21 for registration of a qualifying registrable deed or a registrable deed which is a standard security,
(b) the granter of the deed is an overseas entity whose interest is registered, having been so registered on or after 8 December 2014, and
(c) as at the date of delivery of the deed, the entity was not a registered overseas entity or an exempt overseas entity.
(2) The Keeper must reject the application unless one of the following conditions is met—
(a) the application is made—
(i) in pursuance of a statutory obligation or court order, or
(ii) in respect of a transfer of ownership or other event that occurs by operation of law,
(b) the application is made in pursuance of a contract entered into before the later of the dates mentioned in sub-paragraph (3);
(c) the application is made in pursuance of the exercise of a power of sale or lease by the creditor in a standard security that was registered on or after 8 December 2014;
(d) the application is made in pursuance of the exercise of a right conferred on a body by relevant legislation to buy land or the interest of a tenant under a lease;
(e) the Scottish Ministers give consent under paragraph 7(2) to the registration of the deed;
(f) the deed is granted by a specified insolvency practitioner in specified circumstances.
(3) The dates are—
(a) the date on which the granter’s interest was registered;
(b) the commencement date.
(4) In sub-paragraph (2)(d), “relevant legislation” means Part 2, 3 or 3A of the Land Reform (Scotland) Act 2003 or Part 5 of the Land Reform (Scotland) Act 2016 (being provisions which confer on certain community bodies etc. the right to buy certain types of land or the interest of a tenant under a lease of certain types of land).
(5) In sub-paragraph (2), in paragraph (f)—
“specified circumstances” means circumstances specified in regulations made by the Scottish Ministers for the purposes of that paragraph;
“specified insolvency practitioner” means an insolvency practitioner of a description specified in regulations made by the Scottish Ministers for the purposes of that paragraph.
Cases where Keeper must reject application to register notice of title
3 (1) This paragraph applies where—
(a) by virtue of section 4A of the Conveyancing (Scotland) Act 1924, a person makes an application under section 21 for registration of a notice of title completing title in respect of a qualifying registrable deed, and
(b) if the application is accepted by the Keeper—
(i) the name of an overseas entity would be entered as proprietor in the proprietorship section of the title sheet of a registered plot of land, or
(ii) an overseas entity would be the tenant under a registered lease.
(2) The Keeper must reject the application unless the overseas entity is—
(a) a registered overseas entity, or
(b) an exempt overseas entity.
(3) Sub-paragraph (2) does not apply where—
(a) the application is made by a person other than the overseas entity referred to in sub-paragraph (1)(b)(i), and
(b) the deed in respect of which title is being completed is a lease or an assignation of a lease the subjects of which consist of or form part of an unregistered plot of land of which that overseas entity is the proprietor.
4 (1) This paragraph applies where—
(a) by virtue of section 4A of the Conveyancing (Scotland) Act 1924, a person makes an application under section 21 for registration of a notice of title completing title in respect of—
(i) a qualifying registrable deed, or
(ii) a registrable deed which is a standard security,
(b) the granter of the deed is an overseas entity whose interest is registered, having been so registered on or after 8 December 2014, and
(c) as at the date on which the application for registration of the notice of title was made, the entity was not a registered overseas entity or an exempt overseas entity.
(2) The Keeper must reject the application unless one of the following conditions is met—
(a) the application is made—
(i) in pursuance of a statutory obligation or court order, or
(ii) in respect of a transfer of ownership or other event that occurs by operation of law,
(b) the application is made in pursuance of a contract entered into before the later of the dates mentioned in sub-paragraph (3);
(c) the application is made in pursuance of the exercise of a power of sale or lease by the creditor in a standard security that was registered on or after 8 December 2014;
(d) the application is made in pursuance of the exercise of a right conferred on a body by relevant legislation to buy land or the interest of a tenant under a lease;
(e) the Scottish Ministers give consent under paragraph 7(4) to the registration of the notice of title;
(f) the deed in respect of which title is being completed is granted by a specified insolvency practitioner in specified circumstances.
(3) The dates are—
(a) the date on which the granter’s interest was registered;
(b) the commencement date.
(4) In sub-paragraph (2)(d), “relevant legislation” means Part 2, 3 or 3A of the Land Reform (Scotland) Act 2003 or Part 5 of the Land Reform (Scotland) Act 2016 (being provisions which confer on certain community bodies etc. the right to buy certain types of land or the interest of a tenant under a lease of certain types of land).
(5) In sub-paragraph (2)(f) “specified circumstances” and “specified insolvency practitioner” have the meanings given by paragraph 2(5).
Case where Keeper must reject prescriptive application
5 (1) This paragraph applies where—
(a) an application under section 21 is received by the Keeper by virtue of section 43(1) or (5), and
(b) if the application is accepted by the Keeper—
(i) the name of an overseas entity would be entered as proprietor in the proprietorship section of the title sheet of a registered plot of land, and
(ii) that entry would be marked as provisional under section 44(1).
(2) The Keeper must reject the application unless the overseas entity is—
(a) a registered overseas entity, or
(b) an exempt overseas entity.
Case where Keeper must reject voluntary application
6 (1) This paragraph applies where—
(a) an application is made under section 27, and
(b) if the application is accepted by the Keeper, the name of an overseas entity would be entered as proprietor in the proprietorship section of the title sheet of a registered plot of land.
(2) The Keeper must reject the application unless the overseas entity is—
(a) a registered overseas entity, or
(b) an exempt overseas entity.
Consent to registration of certain deeds that cannot otherwise be registered
7 (1) Sub-paragraph (2) applies where the Keeper would be required by paragraph 2(2) to reject an application for registration of a qualifying registrable deed or a registrable deed which is a standard security.
(2) The Scottish Ministers may consent to registration of the deed if satisfied—
(a) that at the time of delivery of the deed the person in whose favour it was granted did not know, and could not reasonably have been expected to know, of the duty imposed on the Keeper by paragraph 2(2), and
(b) that in all the circumstances it would be unjust for the deed not to be registered.
(3) Sub-paragraph (4) applies where the Keeper would be required by paragraph 4(2) to reject an application for registration of a notice of title in respect of a qualifying registrable deed or a registrable deed which is a standard security.
(4) The Scottish Ministers may consent to registration of the notice of title if satisfied—
(a) that at the time of delivery of the qualifying registrable deed or (as the case may be) registrable deed which is a standard security the person in whose favour the deed was granted did not know, and could not reasonably have been expected to know, of the duty imposed on the Keeper by paragraph 4(2), and
(b) that in all the circumstances it would be unjust for the notice of title not to be registered.
(5) The Scottish Ministers may by regulations make provision in connection with applications for consent, and the giving of consent, under sub-paragraphs (2) and (4).
(6) The regulations may, for example, make provision about—
(a) who may apply;
(b) evidence;
(c) time limits.
Partially executed deeds
8 For the purposes of paragraphs 2(1)(c) and 7(2)(a) and (4)(a), a qualifying registrable deed or registrable deed which is a standard security is to be treated, as at the date of delivery of the deed, as having been granted even if at that time it has been executed by the overseas entity only.
Interpretation
9 (1) In this schedule—
“the commencement date” means the day on which Part 1 of Schedule 4 to the Economic Crime (Transparency and Enforcement) Act 2022 comes into force;
“exempt overseas entity” means an overseas entity of a description specified in regulations under section 34(6) of the Economic Crime (Transparency and Enforcement) Act 2022;
“overseas entity” has the meaning given by section 2 of the Economic Crime (Transparency and Enforcement) Act 2022;
“qualifying registrable deed” means a registrable deed which is—
a disposition;
a lease;
an assignation of a lease;
“register of overseas entities” means the register kept under section 3 of the Economic Crime (Transparency and Enforcement) Act 2022;
“registered overseas entity” means an overseas entity that is registered in the register of overseas entities (but see sub-paragraphs (2) and (3)).
(2) For the purposes of this Schedule, an overseas entity that fails to comply with the duty in section 7 of the Economic Crime (Transparency and Enforcement) Act 2022 (updating duty) is not to be treated as being a “registered overseas entity” until it remedies the failure.
(3) For the purpose of sub-paragraph (2), an overseas entity “remedies” the failure when it delivers the statements and information mentioned in section 7(1)(a), (b) and (c) of the 2022 Act.
PART 2 Transition: deeds registered pre-commencement
Duty to register as an overseas entity within transitional period
10 (1) This paragraph applies where—
(a) an overseas entity is entered as proprietor in the proprietorship section of the title sheet for a plot of land that is registered in the Land Register of Scotland, having been so entered during the pre-commencement period,
(b) in relation to a lease that was recorded in the General Register of Sasines or registered in the Land Register of Scotland before 8 December 2014, an overseas entity is, by virtue of an assignation of the lease registered in the Land Register of Scotland during the pre-commencement period, the tenant under the lease, or
(c) an overseas entity is the tenant under a lease that was registered in the Land Register of Scotland during the pre-commencement period.
(2) An overseas entity, and every officer of the entity who is in default, commits an offence if—
(a) on the expiry of the transitional period, the paragraph of sub-paragraph (1) that applied in relation to the overseas entity immediately before the beginning of the transitional period continues to apply in relation to the overseas entity, and
(b) the entity is not registered as an overseas entity, has not made an application for registration as an overseas entity that is pending and is not an exempt overseas entity.
(3) A person guilty of an offence under this paragraph is liable—
(a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum (or both);
(b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine (or both).
(4) Nothing in this paragraph limits the power to give a notice under section 34 at any time.
Disapplication of certain provisions during transitional period
11 (1) This paragraph applies where—
(a) an overseas entity is entered as proprietor in the proprietorship section of the title sheet for a plot of land that is registered in the Land Register of Scotland, having been so entered during the pre-commencement period,
(b) in relation to a lease that was recorded in the General Register of Sasines or registered in the Land Register of Scotland before 8 December 2014, an overseas entity is, by virtue of an assignation of the lease registered in the Land Register of Scotland during the pre-commencement period, the tenant under the lease, or
(c) an overseas entity is the tenant under a lease that was registered in the Land Register of Scotland during the pre-commencement period.
(2) During any part of the transitional period in which the paragraph of sub-paragraph (1) that applied in relation to the overseas entity during the pre-commencement period continues to apply in relation to the overseas entity, the Land Registration etc. (Scotland) Act 2012 (asp 5) (“the 2012 Act”) applies subject to the following modifications.
(3) Section 112A of the 2012 Act does not apply in relation to the entity or an officer of the entity as regards the plot of land or, as the case may be, lease.
(4) Paragraphs 2 and 4 of schedule 1A to the 2012 Act do not apply in relation to the entity as regards the plot of land or, as the case may be, lease.
Interpretation
12 In this Part of this Schedule—
“the commencement date” means the day on which section 3(1) comes fully into force;
“exempt overseas entity” means an overseas entity of a description specified in regulations under section 34(6);
“lease” has the meaning given by section 113(1) of the Land Registration etc. (Scotland) Act 2012;
“plot of land” has the meaning given by section 113(1) of the Land Registration etc. (Scotland) Act 2012;
“pre-commencement period” means the period beginning with 8 December 2014 and ending immediately before the commencement date;
“proprietor” has the meaning given by section 113(1) of the Land Registration etc. (Scotland) Act 2012;
“transitional period” has the meaning given by section 41(10).
13 For the purposes of paragraphs 10(1)(a) and 11(1)(a)—
(a) references to an overseas entity’s being entered as proprietor in the proprietorship section of a title sheet are references to the name of the entity being so entered, and
(b) the date on which an overseas entity was entered as proprietor in the proprietorship section of a title sheet is, where the entry was made by virtue of an application for registration, the date of registration as determined under section 37 of the Land Registration etc. (Scotland) Act 2012 (date and time of registration).
PART 3 Power to make further provision
14 (1) The Secretary of State may by regulations make further or alternative provision for the purpose of requiring or encouraging an overseas entity that owns or holds a right or interest in or over land in Scotland, or enters into land transactions in Scotland, to register as an overseas entity.
(2) No regulations may be made under this paragraph after the end of the transitional period (within the meaning given by section 41(10)).
(3) Regulations under this paragraph may amend, repeal or revoke provision made by this Schedule, or any provision made by or under any other Act or Act of the Scottish Parliament, made—
(a) before this Act, or
(b) later in the same session of Parliament as this Act.
(4) The provision which may be made by regulations under this paragraph by virtue of section 67(3) includes (in addition to provision of the kind mentioned in sub-paragraph (3)) provision amending any other provision of this Part of this Act.
(5) The Secretary of State must consult the Scottish Ministers before making regulations under this paragraph that contain provision that would be within the legislative competence of the Scottish Parliament if contained in an Act of that Parliament.
(6) Regulations under this paragraph are subject to the affirmative resolution procedure.
SCHEDULE 5 Land ownership and transactions: Northern Ireland
Section 33(3)
1 The Land Registration Act (Northern Ireland) 1970 is amended as follows.
2 After section 61 insert—
Overseas entities
61A Schedule 8A is about the ownership of registered land by overseas entities and about registrable dispositions made by them.
3 After Schedule 8 insert—
SCHEDULE 8A
Overseas entities
Section 61A
PART 1 Registration and dispositions
Meaning of “qualifying estate”
1 In this Schedule “qualifying estate” means—
(a) a freehold estate in land, or
(b) a leasehold estate in land granted for a term of more than 21 years from the date of grant.
Registration
2 No application may be made to register an overseas entity as the owner of a qualifying estate unless, at the time of the application, the entity—
(a) is a registered overseas entity, or
(b) is an exempt overseas entity.
Restrictions on disposal
3 (1) The Registrar must enter an inhibition (“an overseas entity inhibition”) against the title of the registered owner of a qualifying estate if satisfied that—
(a) the registered owner is an overseas entity, and
(b) the entity became registered as the owner in pursuance of an application made on or after the date on which paragraph 2 comes into force.
(2) No fee is to be charged for the entry of an overseas entity inhibition.
(3) From and after the entry of an overseas entity inhibition, none of the dispositions mentioned in sub-paragraph (4) affecting the land in question are to be entered on the title register, unless one of the conditions in sub-paragraph (5) is met.
(4) The dispositions are—
(a) a transfer of the owner’s estate,
(b) a grant of a leasehold estate where the term granted exceeds 21 years, and
(c) the creation of a charge on the land.
(5) The conditions are that—
(a) the entity is a registered overseas entity, or is an exempt overseas entity, at the time of the disposition,
(b) the disposition is made in pursuance of a statutory obligation or court order, or occurs by operation of law,
(c) the disposition is made in pursuance of a contract made before the inhibition is entered in the register,
(d) the disposition is made in the exercise of a power of sale or leasing conferred on the owner of a registered charge or a receiver appointed by such an owner, or
(e) the disposition is made by a specified insolvency practitioner in specified circumstances.
(6) In sub-paragraph (5), in paragraph (e)—
“specified circumstances” means circumstances specified in regulations made by the Department of Finance for the purposes of that paragraph;
“specified insolvency practitioner” means an insolvency practitioner of a description specified in regulations made by the Department of Finance for the purposes of that paragraph.
(7) Regulations made under sub-paragraph (6) are subject to the negative resolution.
Registrable dispositions by overseas entity entitled to be registered (but not registered)
4 (1) This paragraph applies where—
(a) an overseas entity is entitled to be registered as the owner of a qualifying estate,
(b) the overseas entity became entitled to be registered as the owner of that estate on or after the day on which this paragraph comes into force, and
(c) the entity makes a disposition mentioned in subparagraph (2).
(2) The dispositions are—
(a) a transfer of the owner’s estate,
(b) a grant of a leasehold estate where the term granted exceeds 21 years, and
(c) the creation of a charge on the land.
(3) The disposition must not be registered unless—
(a) the entity is a registered overseas entity, or is an exempt overseas entity, at the time of the disposition,
(b) the disposition is made in pursuance of a statutory obligation or court order, or occurs by operation of law,
(c) the disposition is made in pursuance of a contract made before the overseas entity became entitled to be registered,
(d) the disposition is made in the exercise of a power of sale or leasing conferred on the owner of a registered charge or a receiver appointed by such an owner, or
(e) the disposition is made by a specified insolvency practitioner in specified circumstances.
(4) In sub-paragraph (3)(e) “specified circumstances” and “specified insolvency practitioner” have the meanings given by paragraph 3(6).
Making dispositions that cannot be registered
5 (1) An overseas entity must not make a registrable disposition of a qualifying estate if the registration of the disposition is prohibited by—
(a) an inhibition entered under paragraph 3, or
(b) paragraph 4.
(2) If an overseas entity breaches sub-paragraph (1) an offence is committed by—
(a) the entity, and
(b) every officer of the entity who is in default.
(3) Nothing in this paragraph affects the validity of a disposition made in breach of sub-paragraph (1).
(4) Sections 1121 to 1123 of the Companies Act 2006 (liability of officers in default: interpretation etc) apply for the purposes of this paragraph as they apply for the purposes of provisions of the Companies Acts.
(5) In those sections as applied, a reference to an officer includes a person in accordance with whose directions or instructions the board of directors or equivalent management body of an overseas entity are accustomed to act.
(6) A person is not to be regarded as falling within sub-paragraph (5) by reason only that the board of directors or equivalent management body acts on advice given by the person in a professional capacity.
(7) A person guilty of an offence under this paragraph is liable—
(a) on summary conviction, to imprisonment for a term not exceeding 6 months or a fine not exceeding the statutory maximum (or both);
(b) on conviction on indictment, to imprisonment for a term not exceeding 5 years or a fine (or both).
(8) Proceedings for an offence under this paragraph may only be brought by or with the consent the Secretary of State or the Director of Public Prosecutions for Northern Ireland.
Interpretation etc
6 In this Schedule—
“exempt overseas entity” means an overseas entity of a description specified in regulations under section 34(6) of the Economic Crime (Transparency and Enforcement) Act 2022;
“overseas entity” has the meaning given by section 2 of the Economic Crime (Transparency and Enforcement) Act 2022;
“qualifying estate” has the meaning given by paragraph 1;
“register of overseas entities” means the register kept under section 3 of the Economic Crime (Transparency and Enforcement) Act 2022;
“registered overseas entity” means an overseas entity that is registered in the register of overseas entities (but see paragraph 7).
7 (1) For the purpose of this Schedule, an overseas entity that fails to comply with the duty in section 7 of the Economic Crime (Transparency and Enforcement) Act 2022 (updating duty) is not to be treated as being a “registered overseas entity” until it remedies the failure.
(2) For the purpose of sub-paragraph (1), an overseas entity “remedies” the failure when it delivers the statements and information mentioned in section 7(1)(a), (b) and (c) of the 2022 Act.
SCHEDULE 6 Duty to deliver further information for transitional cases
Application of this Schedule
1 (1) This Schedule applies in relation to an overseas entity if—
(a) the entity—
(i) is registered as an overseas entity when this Schedule comes into force or has been so registered at any earlier time, and
(ii) was registered as the proprietor of a relevant interest in land in England and Wales or Scotland at any time during the relevant period, or
(b) the entity has committed an offence under paragraph 5 of Schedule 3 or paragraph 10 of Schedule 4 (duty to register as overseas entity in certain transitional cases).
(2) For the purposes of sub-paragraph (1)—
(a) an overseas entity is registered as the proprietor of a relevant interest in land in England and Wales if the entity is registered in the register of title kept under the Land Registration Act 2002 as the proprietor of a qualifying estate within the meaning of Schedule 4A to that Act;
(b) an overseas entity is registered as the proprietor of a relevant interest in land in Scotland if the entity—
(i) is entered, on or after 8 December 2014, as proprietor in the proprietorship section of the title sheet for a plot of land that is registered in the Land Register of Scotland,
(ii) in relation to a lease that was recorded in the General Register of Sasines or registered in the Land Register of Scotland before that date is, by virtue of an assignation of the lease registered in the Land Register of Scotland on or after that date, the tenant under the lease, or
(iii) is the tenant under a lease that was registered in the Land Register of Scotland on or after that date.
(3) Expressions used in sub-paragraph (2)(b) are to be construed in accordance with section 9(11) and (12).
(4) In this Schedule “the relevant period” means the period—
(a) beginning with 28 February 2022;
(b) ending with 31 January 2023.
Duty to deliver statements and information
2 (1) The overseas entity must deliver to the registrar—
(a) any statements or information required by—
paragraph 3 (changes in beneficial ownership of overseas entity),
paragraph 4 (information about trusts and changes in beneficiaries under trusts), and
paragraph 5 (information about changes in trusts in which beneficial owners trustees),
(b) a statement that the entity has complied with paragraph 8 of this Schedule (duty to take steps to obtain information),
(c) anything required by regulations under section 16 (verification of information) to be delivered to the registrar, and
(d) the name and contact details of an individual who may be contacted about the statements and information.
(2) If an overseas entity is registered as an overseas entity when this Schedule comes into force it must deliver the statements and information required by this Schedule—
(a) at the same time as it delivers the statements and information required by section 7 on the first occasion after the end of the period of 3 months beginning with the day on which this Schedule comes into force, or
(b) if it applies under section 9 for removal before then, at the same time as it delivers the statements and information required by that section.
(3) If an overseas entity is not registered as an overseas entity when this Schedule comes into force it must deliver the statements and information required by this Schedule within the period of 3 months beginning when it comes into force.
Information about changes in beneficial ownership
3 (1) The overseas entity must deliver to the registrar the statement in row 1 of the following table or the statement and information listed in row 2.
Statement | Information
1 | A statement that the entity has noreasonable cause to believe that anyone became or ceased to be a registrable beneficial owner during the relevant period.
2 | A statement that the entity has reasonable cause to believe that at least one person became or ceased to be a registrable beneficial owner during the relevant period. | The required information about each person who became or ceased to be a registrable beneficial owner during the relevant period, or so much of that information as the entity has been able to obtain. The date on which each of them became or ceased to be a registrable beneficial owner, if the entity has been able to obtain that information.
(2) Where the information provided under sub-paragraph (1) includes information that the person who became or ceased to be a registrable beneficial owner was a registrable beneficial owner by virtue of being a trustee (see paragraphs 3(1)(f) and 5(1)(h) of Schedule 1), the overseas entity must also deliver to the registrar—
(a) the required information about the trust or so much of that information as the overseas entity has been able to obtain, and
(b) a statement as to whether the entity has any reasonable cause to believe that there is required information about the trust that it has not been able to obtain.
(3) Statements required by this paragraph to be delivered to the registrar must relate to the time when they are delivered.
(4) Information required by this paragraph to be delivered to the registrar as a result of a person having become or ceased to be a registrable beneficial owner must relate to the state of affairs when the person became or ceased be a registrable beneficial owner.
(5) For the required information, see Schedule 1.
Information about trusts and changes in beneficiaries
4 (1) The overseas entity must deliver to the registrar—
(a) a statement that the entity has no reasonable cause to believe that there is any person who, at the end of the relevant period, was a registrable beneficial owner of the entity by virtue of being a trustee, or
(b) a statement that the entity has reasonable cause to believe that there is at least one such person.
(2) Where a statement is delivered under sub-paragraph (1)(b) the overseas entity must also deliver to the registrar —
(a) the required information about each trust (a “relevant trust”) by virtue of which a trustee was a registrable beneficial owner of the entity at the end of the relevant period,
(b) in relation to each relevant trust, a statement as to whether the entity has any reasonable cause to believe that there is required information about the trust that it has not been able to obtain, and
(c) in relation to each relevant trust, the statement in row 1 of the table set out in sub-paragraph (3), or the statement and information listed in row 2 of that table.
(3) This is the table referred to in sub-paragraph (2)(c)—
Statement | Information
1 | A statement that the entity has no reasonable cause to believe that anyone became or ceased to be a beneficiary under the trust during the relevant period.
2 | A statement that the entity has reasonable cause to believe that at least one person became or ceased to be a beneficiary under the trust during the relevant period. | The information specified in paragraph 8(1)(d) of Schedule 1 about each person who became or ceased to be a beneficiary under the trust during the relevant period, or so much of that information as the entity has been able to obtain. The date on which each of them became or ceased to be a beneficiary under the trust, if the entity has been able to obtain that information.
(4) Statements required by this paragraph to be delivered to the registrar must relate to the time when they are delivered.
(5) Information required by sub-paragraph (2)(a) to be delivered to the registrar must relate to the state of affairs at the end of the relevant period.
(6) Information required by sub-paragraph (2)(c) to be delivered to the registrar as a result of a person having become or ceased to be a beneficiary under a trust must relate to the state of affairs when the person became or ceased be a beneficiary.
(7) For the required information, see Schedule 1.
Information about changes in trusts of which registrable beneficial owners trustees
5 (1) The overseas entity must deliver to the registrar—
(a) a statement that the entity has no reasonable cause to believe that there is any person who—
(i) at the end of the relevant period, was a registrable beneficial owner of the entity by virtue of being a trustee of a trust,
(ii) at any time during the relevant period was a registrable beneficial owner by virtue of being a trustee of a different trust, and
(iii) at the end of the relevant period was not a registrable beneficial owner of the entity by virtue of being a trustee of the trust mentioned in sub-paragraph (ii), or
(b) a statement that the entity has reasonable cause to believe that there is at least one such person.
(2) Where a statement is delivered under sub-paragraph (1)(b) the overseas entity must deliver to the registrar—
(a) the required information about each trust by virtue of which a trustee was a registrable beneficial owner of the entity at any time during the relevant period, or so much of that information as the overseas entity has been able to obtain, and
(b) in relation to each such trust, a statement as to whether the entity has any reasonable cause to believe that there is required information about the trust that it has not been able to obtain.
(3) Statements required by this paragraph to be delivered to the registrar must relate to the time when they are delivered.
(4) Information required by sub-paragraph (2)(a) to be delivered to the registrar must relate to the state of affairs—
(a) at the beginning of the relevant period, if the registrable beneficial owner was a trustee of the trust at that time, and
(b) otherwise, at the time at which the registrable beneficial owner became a trustee of the trust.
(5) For the required information, see Schedule 1.
Compliance by confirmation of information previously provided
6 A requirement imposed by paragraphs 2 to 5 to provide information may be met (in whole or in part) by confirming information previously provided.
Failure to comply with this Schedule
7 Section 8 (offence of failure to comply with updating duty) applies in relation to a failure to comply with a duty imposed by paragraphs 2 to 5 of this Schedule as it applies in relation to a failure to comply with section 7.
Obtaining information
8 (1) An overseas entity must comply with this paragraph before complying with the requirements imposed by paragraphs 2 to 5.
(2) The entity must take reasonable steps—
(a) to identify anyone who became or ceased to be a registrable beneficial owner during the relevant period, and
(b) if it identities any such person, to obtain—
(i) the information mentioned in row 2 of column 2 of the table in paragraph 3(1), and
(ii) in the case of anyone mentioned in paragraph 3(2), the information mentioned there.
(3) The entity must take reasonable steps—
(a) to identify any person who, at the end relevant period, was a registrable beneficial owner by virtue of being a trustee, and
(b) if it identities any such person, to obtain —
(i) the information mentioned in paragraph 4(2)(a) about the relevant trust,
(ii) information as to whether anyone became or ceased to be a beneficiary under the relevant trust during the relevant period (a “relevant beneficiary”), and
(iii) the information mentioned in row 2 of column 2 of the table in paragraph 4(3) in relation to any relevant beneficiary.
(4) The entity must take reasonable steps—
(a) to identify any person who falls within paragraph 5(1)(a)(i) to (iii), and
(b) if it identifies any such person, to obtain the information mentioned in paragraph 5(2)(a).
(5) The steps that an overseas entity must take by virtue of this paragraph include giving an information notice under this paragraph to any person that it knows, or has reasonable cause to believe, falls within sub-paragraph (2)(a), (3)(a) or (4)(a).
(6) An information notice under this paragraph is a notice requiring the recipient to provide the information mentioned in sub-paragraph (2)(b), (3)(b) or (4)(b).
(7) Sections 15 to 15B (offences) apply in relation to information notices under this paragraph as they apply in relation to information notices under section 12.
Power to exclude descriptions of registrable beneficial owner
9 (1) The Secretary of State may by regulations provide that, for the purposes of any provision of this Schedule specified in the regulations, a person of a description so specified is not to be treated as a registrable beneficial owner of an overseas entity.
(2) No regulations may be made under sub-paragraph (1) after the end of the period of two years beginning with the day on which the Economic Crime and Corporate Transparency Act 2023 is passed.
(3) The Secretary of State must consult the Scottish Ministers before making regulations under sub-paragraph (1) that contain provision that would be within the legislative competence of the Scottish Parliament if contained in an Act of that Parliament.
(4) Regulations under sub-paragraph (1) are subject to the negative resolution procedure.