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Factsheet: Economic Crime and Corporate Transparency (ECCT) Bill

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Why do we need the Economic Crime and Corporate Transparency (ECCT) Bill? 

The UK is one of the world’s most open and most attractive places for doing business. This same openness means that the UK is exposed to criminal activities, such as money laundering, corruption, and terrorist financing, that can all have a devastating impact on our businesses and citizens. 

The Government acted quickly in response to Russia’s invasion of Ukraine in February 2022 and introduced the Economic Crime Transparency and Enforcement (ECTE) Act to crack down on dirty Russian money and other foreign elites abusing our open economy. This legislation: 

  • allowed Government to impose more severe sanctions faster,
  • created new Register of Overseas Entities to crack down on foreign criminals using their UK property to launder dirty money,
  • strengthened the UK’s Unexplained Wealth Order regime to better support law enforcement investigations.

The Government committed to bringing forward this further Bill to deliver a suite of wider-ranging reforms to tackle economic crime and improve the transparency of corporate entities.  

Key measures of the Economic Crime and Corporate Transparency Bill 

The ECCT Bill will deliver: 

  • Reforms to Companies House,  
  • Reforms to prevent the abuse of limited partnerships,
  • Additional powers to seize and recover suspected criminal cryptoassets,
  • Reforms to give businesses more confidence in sharing information to tackle money laundering and other economic crime,
  • New intelligence gathering powers for law enforcement and removal of unnecessary burdens on business.

These provisions will bear down further on kleptocrats, criminals and terrorists, strengthening the UK’s reputation as a place where legitimate business can thrive, whilst driving dirty money out of the UK. 

Reforms to Companies House 

The Bill will reform the role of Companies House and improve transparency over UK companies and other legal entities. The reforms include:  

  • Introducing identity verification for all new and existing registered company directors, People with Significant Control, and those delivering documents to the Registrar. This will improve the accuracy of Companies House’s data, supporting business decisions and law enforcement investigations. 
  • Broadening Companies House’s powers so that the Registrar can become a more active gatekeeper over company creation and a source of more reliable data. Companies House will be given new powers to check, remove or decline any information that was submitted or is already on the companies register. 
  • Improving the financial information on the register so that the register is more reliable, complete and accurate, it reflects the latest advancements in digital technology, and enables better business decisions.  
  • Strengthening enforcement powers and better cross-checking of data with other public and private sector bodies. Companies House will be able to proactively share information with law enforcement bodies where they have evidence of anomalous filings or suspicious behaviour.
  • Enhancing the protection of personal information provided to Companies House to protect individuals from fraud and other harms. 

Reforms of limited partnerships  

The ECCT Bill will tackle the misuse of limited partnerships, including Scottish limited partnerships, to make them more transparent. One of the key measures will be a requirement for limited partnerships to maintain a connection to the UK. The Bill will also enable the Registrar to deregister any limited partnerships that are dissolved or which are no longer conducting business.  

Seizure and recovery of suspected cryptoassets 

The Bill will provide additional powers to law enforcement so they are able to more quickly and easily seize and recover cryptoassets which have been acquired through illegal routes such as money laundering, fraud and ransomware attacks. The Bill will introduce amendments to the Proceeds of Crime Act 2002 to enable law enforcement to tackle criminal use of cryptoassets more effectively.  

Strengthening Anti-Money laundering measures  

The Bill will strengthen anti-money laundering measures for suspected money laundering, fraud and other economic crimes. The reforms will: 

  • Enable private sector and law enforcement to focus their existing resources on tracking high value and priority activity. 
  • Allow certain businesses to directly share information more easily for the purposes of preventing, investigating or detecting economic crime. Direct sharing provisions will apply to the whole anti-money laundering (AML) regulated sector - such as financial, accountancy, gambling, real estate and high-value dealers. Measures will also enable information sharing via a third-party intermediary, for instance a database akin to the existing National Fraud Database (CIFAS).   
  • Strengthen proactive intelligence gathering by law enforcement agencies who will be able to obtain information from businesses on money laundering and terrorist financing. 

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