Guidance

Companies House enforcement policy

Published 27 September 2024

1. Chair and Chief Executive’s foreword

A key element of the UK’s business environment is a high standard of corporate governance for entities who receive the benefits of limited liability. We give these benefits in exchange for standards of transparency and accountability that are essential to give confidence to business, investors, society and the economy.

People use our services every year to submit millions of items of information and to carry out billions of searches for data. Use of our digital services and user satisfaction in them is high and continues to rise.

Where our guidance and support are not enough to encourage users to comply with the law or discourage misuse of our registers, we’ll use our enforcement powers:

• predictably
• consistently
• judiciously
• in line with our strategic objectives

2. Introduction

We’re responsible for maintaining the register of companies (“the register”) in England and Wales, Scotland and Northern Ireland.

To maintain the register, the Economic Crime and Corporate Transparency Act 2023 asks us to promote the following objectives:

• ensure that any person who is required to deliver a document to the registrar does so (and that the requirements for proper delivery are complied with)
• ensure that information contained in the register is accurate and that the register contains everything it ought to contain
• minimise the risk of records kept by the registrar creating a false or misleading impression to members of the public
• minimise the extent to which companies and others carry out unlawful activities, or facilitate the carrying out of unlawful activities

To promote those objectives, we will use a wide variety of methods to encourage and support business to comply with their legal obligations.

If businesses do not comply, we will consider enforcement options in line with this enforcement policy. In considering these options, we will have regard for economic growth and the impact that our actions are likely to have on businesses.

This policy statement sets out our approach to enforcement. This means where Companies House will take action to enforce the law when we identify non-compliance or breaches of the law.

In addition to providing advice and published information, the enforcement methods available to us include:

• imposing financial penalties
• civil actions, for example, court ordered filing of documents
• criminal prosecutions
• asking the courts to disqualify people from being company directors

We have published this policy so our principles and approach to enforcement are clear.

Everyone at Companies House must follow this enforcement policy. While this policy statement applies throughout the UK, some decisions to prosecute will be made by the:

• Insolvency Service
• Crown Prosecution Service (CPS)
• Crown Office and Procurator Fiscal Service (COPFS) in Scotland
• Public Prosecution Service (PPS) in Northern Ireland

Decisions made by these services will be subject to their policies. Where we refer cases to these other agencies, our recommendations will follow the Companies House policy.

3. Our enforcement policy statement

We believe in firm, but fair, enforcement of the law. It is our policy that all enforcement action should be proportionate to the harm and seriousness of any breach of law.

We consider that appropriate use of our enforcement powers is important, both to:

• secure compliance with the law
• ensure that those who have a legal duty (duty holders) are held to account for significant failures

4. The purpose of enforcement

We will take enforcement action to prevent harm where possible and take action against offenders where appropriate. We will do this by requiring duty holders to comply with all relevant legislation. This includes:

• ensuring action is taken to ensure compliance with the law
• promoting and maintaining sustained compliance with the law
• ensuring that those who breach the law, including individuals who fail in their responsibilities, may be held to account (this includes bringing alleged offenders before the courts in England and Wales, or referring matters (for potential criminal investigation and/or prosecution) to the Insolvency Service, HMRC, CPS, COPFS or PPS)

5. The principles of enforcement

When conducting our enforcement activities, we apply the principles of: 

• proportionality in how we apply the law and secure compliance
• ensuring that cases that cause the most harm are dealt with using our most serious powers and sanctions
• targeting our enforcement action
• consistency of our approach
• transparency about how we operate and what you can expect
• accountability for our actions

These principles apply both to particular cases of enforcement and to our management of enforcement activities as a whole. They are not applied in isolation, but are informed by an understanding of how businesses operate in the real world.

The principles allow for effective enforcement, without stifling economic growth, by requiring Companies House to be:

• proportionate in our decision-making
• mindful in keeping the burden on business productivity to a minimum

6. Proportionality

We adopt a proportionate approach to enforcing the law across different businesses. We recognise the importance of supporting businesses to comply and grow.

In our dealings with duty holders, we will ensure that our enforcement action is proportionate to the:

• likelihood of harm
• seriousness of any breach of the law

This includes any actual or potential harm arising from any breach, and the economic impact of the action. 

Applying the principle of proportionality means that Companies House should take particular account of:

• how far duty holders have fallen short of what the law requires
• the extent of the harm caused

We can also adopt a proportionate approach to enforcing the law during the initial phase of an emergency response. This means duty holders, and others, can in turn manage risks effectively and proportionately.

7. New role and powers of the Registrar of Companies

The Economic Crime and Corporate Transparency Act 2023 has reformed the statutory role and powers of the Registrar of Companies. The registrar is now a more active gatekeeper over company creation and a custodian of more reliable information on the register.

The registrar now has new statutory objectives and new and enhanced powers to help them fulfil these objectives.

Find out more about the registrar’s powers.

8. Compliance framework

We use a risk based approach when deciding how to proceed on any perceived breaches.

Companies House will train and support employees to promote consistency in our approach and our responses to failures.

We’ve developed a compliance framework that shows how Companies House will consider what enforcement or other action may be appropriate.  

The compliance framework considers the level of compliance against the effort that might be needed to achieve it.

The following examples do not cover all possible situations where Companies House may need to consider action against a company, individual or both.

8.1 Companies House compliance framework

Level 1: Compliant – no effort required  

The company or individual:

• always files early or on time (including filings related to a change in the company, like a new director or person with significant control)
• uses information on the Companies House website or seeks professional advice if they need guidance

Companies House will consider:  

• monitoring activity and intelligence
• sending automated reminders by email

Level 2: Compliant with support – minimal effort required  

The company or individual:

• occasionally fails to file on time
• seeks clarification to try and avoid mistakes
• has a complete filing history with no obvious gaps in filings
• brings records up to date when prompted (following a reminder or default notice)

Companies House will consider (in addition to level 1):  

• providing support and guidance through our website or efficient methods of contact like webchat, guidance targeted at new directors, webinars, podcasts or their registered email address
• applying penalties for late filing of accounts
• issuing default statutory notices

Level 3: Disregard for compliance – considerable effort required  

The company or individual:

• cuts corners
• fails to comply with most deadlines
• makes errors through a lack of understanding (may include inconsistencies)
• has a largely complete filing history with some gaps in filings
• only tends to be compliant, and brings records up to date when compelled to do so (after a default notice or threat of prosecution)

Companies House will consider (in addition to levels 1 and 2):  

• targeting communications that set out previous shortcomings in compliance and the consequences of future poor compliance
• making enquiries under part 35 of the Companies Act 2006
• using querying powers
• prioritising for prosecution of false filing offences
• annotating the register to highlight misleading and inaccurate information
• using a court order to compel filing where there are gaps

Level 4: Non-compliant – significant effort required  

The company or individual:

• pays little to no attention to communications from Companies House
• disregards their filing obligations
• regularly files late
• has a pattern of making inaccurate filings or statements (may include inconsistencies)
• has gaps in their filing history
• is wilfully non-compliant, and fails to bring their records up to date when prompted
• walks away from the company

Companies House will consider (in addition to level 3):  

• prioritising for prosecution
• applying to the courts to disqualify an individual from being a director
• obtaining default orders through the court to compel filing
• prosecuting for false filing offences
• using financial penalties
• striking the company off the register

Level 5: Seriously or serially non-compliant – very significant effort required  

The company or individual:

• pays no attention to communications from Companies House
• has disregard for filing obligations
• has significant history of late filing, inaccuracies or both
• has a pattern of making inaccurate filings or statements (may include inconsistencies)
• has significant gaps in filing history
• is wilfully non-compliant, and fails to bring their record up to date when prompted
• walks away from the company (and may have a pattern of doing this)
• has a pattern of non-compliance across multiple company records

Companies House will consider any and all sanctions against the company and those behind it.  

The compliance framework is a general guide to good practice when considering enforcement action.

There will also be times when, depending on the facts of an individual case, it will not be an appropriate tool. The compliance framework is not a substitute for sound judgement in individual cases.  

Companies House will consider each case individually. However, as a general principle, the more serious, high impact, intentional, wilful, neglectful or repeated the failure, the stronger the enforcement action we’ll take.

9. Methods of enforcement

Our approach is to encourage compliance through a range of measures.

Our response to non-compliance will be based on our compliance framework. As issues, or patterns of issues, escalate in frequency or severity, we can use more significant powers in response. However, we can use our most significant powers immediately in serious cases.   

We have a range of enforcement methods to secure compliance with the law and to ensure a proportionate response to any breaches.

Companies House may:  

• provide written information and advice to help companies to be compliant
• issue financial penalties
• pursue a civil case
• pursue a criminal prosecution
• refer a case to other agencies

10. Help for companies to be compliant

Companies House helps individuals and organisations comply with regulatory requirements in a variety of ways including:   

• an email reminder service for companies
• hosting free interactive webinars
• free online guidance for companies
• using contacts in professional bodies
• offering support and advice through our contact centre

11. Financial penalties

See our financial penalties guidance.

12. Prosecution

Prosecution is an essential part of enforcement. It ensures that where there has been a serious breach of the law, duty holders (including individuals) are held to account.

This includes bringing alleged offenders before the courts in England and Wales or referring cases to other agencies.

12.1 England and Wales

In England and Wales, Companies House will decide whether to proceed with some prosecutions.

We’ll refer others to the appropriate agencies. We use discretion when making this decision and consider both the evidential stage and public interest stage  set down by the Director of Public Prosecutions in the Code for Crown Prosecutors.

No prosecution will go ahead unless:

• there is sufficient evidence to providea realistic prospect of conviction, and
• prosecution is required in the public interest

Under the Code for Crown Prosecutors, there is a duty to continually review a prosecution throughout the life of the case. This means that prosecutors must take account of any circumstances that occur as the case develops including any representations forwarded by defendants or their legal representatives.

12.2 Scotland

In Scotland, the COPFS decides whether to prosecute certain cases following a referral from Companies House.  However, the COPFS may investigate the circumstances and institute proceedings independently. We use discretion in deciding whether to report to the COPFS with a view to prosecution. 

Before starting prosecutions, the Procurator Fiscal needs to be satisfied that there is sufficient evidence and that prosecution is in the public interest in line with the COPFS Prosecution Code.

12.3 Northern Ireland

In Northern Ireland the PPS decides whether to prosecute certain cases following a referral from Companies House. However, the PPS may investigate the circumstances and start proceedings independently. We use discretion in deciding whether to report to the PPS with a view to prosecution. 

Before starting prosecutions, the PPS needs to be satisfied that there is enough evidence and that prosecution is in the public interest in line with the PPS Code for Prosecutors.

12.4 Public interest

As part of the test in the Code for Crown Prosecutors we will always consider whether it is in the public interest to prosecute.

In England, Wales, and Scotland, it is likely to be in the public interest to prosecute where: 

• the gravity of an alleged offence, together with the seriousness of any actual or potential harm
• there have been repeated breaches which give rise to significant risk, or persistent and significant poor compliance
• false information has been supplied wilfully, or there has been an intent to deceive, in relation to a matter which gives rise to significant risk

The full test is set out in the Code for Crown Prosecutors.

It is also likely to be in the public interest to prosecute where:

• it is appropriate in the circumstances to draw general attention to the need to comply with the law
• conviction may deter others from similar failures to comply with the law

12.5 Prosecution of individuals

Subject to the Code for Crown Prosecutors, we will identify and prosecute individuals, or refer to another agency, where we consider this is warranted.

We will consider the role played by individual directors and officers and consider taking action against them where both:

• we believe an offence has been committed
• it would be appropriate to do so in accordance with this policy

Where appropriate, we will seek disqualification of directors under the Company Directors Disqualification Act 1986.

12.6 Referral to other agencies

We use discretion when deciding whether to refer cases to other prosecution agencies.

This means considering:  

• the scale of potential or actual harm
• the seriousness of any potential breach of the law
• our enforcement priorities
• the practicality of achieving results
• the wider relevance of the event, including serious public concern

13. Late filing penalties

See our late filing penalties guidance.

14. Other outcomes

We can ask a court to order a company to provide documents and accounts. This may cost the company money.

If the company does not deliver documents after being ordered to by the court, the directors may be disqualified from acting as directors.

A company may ultimately be struck off the register if they do not file documents as required.

15. Working with others to take effective action 

Companies House will work with a range of other regulators and agencies to promote holistic enforcement action when appropriate. This includes:   

• police and law enforcement, including the National Crime Agency
• Financial Conduct Authority
• The Insolvency Service
• Foreign, Commonwealth and Development Office (FCDO)
• HM Treasury
• HMRC

We share intelligence, threat analyses, insight, and tactics. We refer relevant cases where they fall within the jurisdiction of these regulators and agencies.

Where we take joint activity, we will coordinate to ensure a proportionate burden on those being investigated. For example, minimising duplication of evidence gathering or information requests. These arrangements will be set out in protocols and memoranda of understanding.  

We will also cooperate and assist overseas authorities where we have the power to do so. Companies House is a member of the Corporate Registers Forum, an association of international corporate registries.

16. Consistency

We will seek to be consistent in applying our enforcement powers by, as far as possible, dealing with similar cases in a similar manner.

We understand that duty holders expect a consistent approach from Companies House when taking enforcement action.

However, consistency of approach does not mean uniformity. It means taking a similar approach in similar circumstances to achieve compliance with the law. 

The facts in one case are rarely the same in another case. In every situation we face many variables, including:

• the degree of harm -  the seriousness of any breach
• the attitude and competence of management within the company
• previous history
• previous enforcement action

Even though we seek to achieve broad consistency, we will make different decisions in cases where the facts are not the same. We will seek to use the principles and processes set out in this strategy to decide how to respond. 

Any enforcement decision therefore requires the appropriate use of individual discretion and professional judgement. 

We aim to ensure that our enforcement decisions are consistent through:

• the application of our enforcement decision-making framework
• peer review

17. Transparency

Our enforcement action should clearly outline to duty holders both:

• what they have to do
• what they do not have to do

When we identify non-compliance, we’ll offer help and guidance if appropriate, in line with this policy. We’ll also explain to duty holders what will happen if they do not comply. 

Transparency also involves keeping victims of alleged offences informed of relevant enforcement action. We’ll aim to do this where the law allows.

18. Accountability and effectiveness of the enforcement policy

Companies House will report annually about our enforcement work. This may also include reporting on specific issues identified with individual organisations or sectors. 

We will keep the enforcement policy under review and evaluate it regularly.

Companies House is committed to transparency and accountability. We will be as open as possible about our enforcement activity.

We will normally publish details about the volume and types of cases we pursue and their outcomes. We may publish case study examples to highlight good practice or for educational purposes.   

Companies House will be particularly careful to properly consider redaction of confidential, sensitive or commercially sensitive information before any publication. We will also focus on effectiveness and outcomes rather than any specific sanction or enforcement activity.  

We will also consider publicising any conviction which could serve to draw attention to the need to comply with the law. In Scotland, decisions in relation to publicity of prosecutions are a matter for the Crown Office.