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What is the ECCTA?

Economic Crime and Corporate Transparency Act 2023 (ECCTA) came into force on 4 March 2024 with the overarching objective of tackling economic crime and improving transparency over UK corporate entities. Here are some key aspects of the Act:
 
1. Failure to Prevent Fraud: The ECCTA introduces a new corporate offense where organizations can be held criminally liable if they fail to prevent fraud committed by associated persons (such as employees or agents). This applies to large organizations with significant turnover, assets, or a substantial number of employees 
2. Corporate Liability Reform: The Act revises the "identification principle," making it easier to prosecute companies for criminal activities by focusing on senior managers' roles and responsibilities rather than their titles
3. Companies House Reforms: Companies House is granted enhanced powers to query and amend information in the register. This includes mandatory identity verification for directors and individuals with significant control over companies
4. Cryptoassets Regulation: The Act extends the Proceeds of Crime Act 2002 to cover cryptoassets, enabling law enforcement to seize, freeze, and recover cryptoassets involved in criminal activities 
5. Register of Overseas Entities: The Act expands the requirements for foreign entities owning UK land to disclose their beneficial owners, aiming to increase transparency and prevent the use of UK property for hiding illicit wealth 
6. Strategic Litigation Against Public Participation (SLAPPs): The ECCTA includes measures to counteract SLAPPs, which are lawsuits intended to intimidate and silence critics through legal harassment

The ECCTA represents a comprehensive effort to combat economic crime and improve corporate transparency in the UK, with a wide-ranging impact on various sectors and compliance requirements for businesses.

For more information, please go to:

https://www.legislation.gov.uk/ukpga/2023/56/contents

https://www.gov.uk/government/publications/economic-crime-and-corporate-transparency-act-2023-factsheets