Out-Law News | 14 Mar 2022 | 2:02 pm | 1 min. read
The Scottish government should act to review the scope of its new land interests register in the wake of proposed UK legislation to force overseas entities to declare their ‘beneficial owner’.
From 1 April 2022 a new requirement will be placed on property owners in Scotland who do not make decisions about what happens to their land to enter the details of their decision-making associate in a Register of Controlled Interests (RCI).
The transition period between the introduction of the register and criminal sanctions being imposed is one year, so as of 1 April 2023, landowners or longstanding tenants will become liable for criminal sanctions for non-compliance with the RCI reporting requirements.
Property law expert Alan Cook of Pinsent Masons said the Scottish government had previously committed to reviewing the RCI once the UK government had introduced its long-trailed register of overseas entities (ROE). The ROE is now set to be introduced as part of the new Economic Crime (Transparency and Enforcement) Bill which is currently before the UK Parliament.
Cook said the Scottish government should now look to remove non-UK entities from the scope of the RCI, in order to avoid any duplication of reporting requirements.
“It is now incumbent on the Scottish government to undertake that review and make those changes to the RCI, ideally before criminal sanctions for non-compliance with the RCI reporting requirements kick in in April 2023,” Cook said.
“The Scottish government is now in a position to cut the regulatory burden on those investing in Scotland by undertaking, in the light of the introduction of the ROE, their previously promised review of the scope of the RCI,” Cook said.
Under the current proposals, non-UK entities will have to register in both the new registers.
The RCI regulations are intended to increase public transparency in relation to individuals who have control over decision-making in relation to land. The Scottish government said in an explanatory document published in December 2020 that the introduction of the RCI, together with other transparency regimes, would make it possible to “look behind every category of entity in Scotland, including overseas entities and trusts, to see who controls land”.
The RCI will be maintained by the Keeper of the Registers of Scotland and will be free to access. Affected property owners, or tenants under leases of more than 20 years, will have to submit the details of the land, their own details, and the details of those with significant influence or control over the owner or tenant.
More detailed guidance on how to make an entry in the register, and when entries can be made, is expected shortly.
01 Mar 2022
16 Aug 2018