New Companies House information sharing arrangements to assist insolvency practitioners

New rights have been given to the Registrar of Companies to allow the sharing of non-public information with insolvency practitioners (IPs).

The Information Sharing (Disclosure by the Registrar) Regulations 2024 (the regulations) brought into effect from 20 December 2024 provisions made by the Economic Crime and Corporate Transparency Act 2023 (ECCTA).

The regulations empower the Registrar of Companies to disclose non-public information to specific individuals and entities involved in insolvency proceedings. This aims to facilitate investigations into potential corporate misconduct and asset recovery efforts.

By facilitating greater information flow to IPs, the regulations strengthen the fight against economic crime, particularly fraudulent trading, wrongful trading, and other illegal activities related to company and personal insolvency. They are also likely to benefit creditors by supporting IPs in their efforts to recover assets and investigate transactions that may have unfairly disadvantaged creditors.

The regulations provide that non-public information can be shared with specified persons - IPs, The Official Receiver, The Accountant in Bankruptcy, Trustees in sequestration and protected trust deeds in Scotland and Judicial factors in Scotland.

The disclosure of information can only be made where it is for certain specified purposes. This includes assisting the specified person to make or determine whether to make an application to the court for an order relating to fraudulent and wrongful trading, transactions at an undervalue and preferences, extortionate credit transactions and gratuitous alienations under insolvency provisions across the UK.

Information can also be shared where it will assisting a specified person to carry out any function in connection with sequestrations under the Bankruptcy (Scotland) Act 2016. Similarly information can be disclosed if the registrar is satisfied that the information is necessary for the purpose of assisting a specified person to trace, realise or recover property in collective judicial or administrative proceedings pursuant to a law relating to insolvency in which the assets and affairs of a debtor are subject to control or supervision by a court for the purpose of reorganisation or liquidation.

While currently non-public information likely to be of benefit would be limited to full dates of birth and residential addresses of directors or persons of significant control, as new ECCTA provisions are commenced the scope of non-public information held by Companies House and which might be of assistance to IPs is likely to increase. This might include for example information used as part of mandatory identification checks on directors, bank details where fees have been paid, internet IP addresses where electronic filing have occurred from, etc.

These new powers represent a significant development in UK insolvency law and the battle against economic crime, enabling greater cooperation between the Registrar of Companies, IPs and others involved in insolvency processes and is likely to have a positive impact on the effectiveness of insolvency procedures.

However, it is crucial to ensure that the information sharing provisions are used responsibly and proportionately. IPs should not therefore routinely make applications for the disclosure of non-public information.

Companies House have advised ICAS that they are in the process of finalising guidance and a proforma request form which will be able to be used by IPs to make these requests. Once this is available, details will be communicated to IPs.