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What is a beneficial owner?

Beneficial Ownership and the Definition of Control

A "beneficial owner" in relation to a company refers to the natural person(s) who, either directly or indirectly, holds ultimate ownership or control over the corporate entity. This control is defined in line with the criteria applied to the public register of persons with significant control of UK companies, as introduced by the Small Business, Enterprise and Employment Act 2015, commonly known as the “PSC Register”.

Understanding "Person with Significant Control" (PSC)

A person is considered to have significant control over a company if they, either individually or jointly with others, satisfy one or more of the following conditions:

Share Ownership: Direct or indirect possession of over 25% of the company's shares. For companies with share capital, this is based on the nominal value. For companies without a share capital, the criteria is met if an individual has rights to over 25% of the company’s capital or profits.

Voting Rights: Direct or indirect control of over 25% of the company's voting rights. Voting rights held by the company are excluded from this calculation.

Board Control: Possession of the right, either directly or indirectly, to appoint or remove the majority of the company's board of directors.

Significant Influence: The individual either holds the right to exercise, or actively wields significant influence or control over the company. Official guidance on what constitutes "significant influence or control" will be provided by the Secretary of State for Business Innovation and Skills. This guidance, when available, must be consulted to understand this condition fully.

Trust or Firm Control: If the trustees of a trust or members of a firm (which isn't a legal entity) exercise control over the company via conditions 1 to 4, and an individual exerts significant control or influence over the trust or firm's activities.

For detailed KYC compliance, please visit the Hoxton Mix's Know Your Customer section.

Updated on: 16/08/2023

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