As 2024 came and went, most changes turned out to be fairly minor and did not significantly change the process of, for example, incorporating new companies or filing annual confirmation statements. We expect the changes scheduled to take place in 2025 to be more substantial.

Change has been long in coming and it is now widely acknowledged that too much of the information hosted at Companies House is misleading, wrong, or, in the worst cases, fraudulent.

Victims of fraudsters are currently in the unenviable position of having to overcome significant hurdles to have their personal information, used without their consent by fraudsters, removed from the Companies House online records, including having to go so far as to get a court order. Any change that can reduce the time and stress involved in the process can only be welcomed.  

Identity Verification

Starting from 25 March 2025, Companies House will introduce a phased identity verification process. Interestingly, current Companies House guidance says that this will be purely voluntary until the compulsory verification regime is rolled out.

Once the measures become compulsory, those involved in setting up, running, owning, or controlling a company in the UK must verify their identity. This includes new and existing company directors, people with significant control (PSCs), and individuals filing information on behalf of a company. Verification can be completed directly through Companies House using GOV.UK One Login or via an Authorised Corporate Service Provider (ACSP).

As of February 2025, it is not clear how, from a practical point of view, the experience of making filings online will change as a result of these implementations.

Protecting Personal Information

From 27 January 2025, individuals will be able to apply to suppress their home address from the record where it has been used as a company’s registered office – this is highly welcome.

From spring/summer 2025, individuals will be able to apply to suppress personal information from historical documents held by Companies House. This measure aims to protect personal data and prevent misuse. Guidance on the application process and eligibility criteria will be made available to ensure individuals can effectively manage their information – we hope this will reduce the burden on victims of fraud wanting to correct the record.

Compliance and Enforcement

Companies House has been granted enhanced powers to query and remove inaccurate or misleading information from its registers. New financial penalties have been introduced for non-compliance, underscoring the importance of adhering to filing requirements and maintaining accurate company information.

We particularly urge clients incorporating UK based companies to thoroughly check incorporation forms and annual confirmation statements to avoid any errors – not only is this good practice, it may also prevent a costly and unhappy process of correcting errors later on.

If you have any questions about the upcoming changes, our Corporate & Commercial team would be happy to assist – please contact us here: law@sherrards.com or using the details below. 

WMT is a leading accountancy firm in St Albans, providing tax, audit, accounting, employer services and corporate finance advice to private individuals and corporate clients.

Moore Kingston Smith is a leading accountancy and advisory network with six offices in London and the south-east of England.

Our team, led by Corporate and Commercial Partner, Leigh Head, assisted by Solicitor, Tabeer Hussain, advised on the transaction and worked closely with WMT to ensure a smooth and efficient merger process.

WMT’s six partners and 78 team members will now join Moore Kingston Smith’s St Albans team, which consists of three partners and two directors.  The merger not only offers enhanced career development and progression opportunities for the WMT team, but also bolsters Moore Kingston Smith’s growing leisure, hospitality and travel group with the inclusion of WMT Troncmaster Services Limited as part of the enlarged group.

WMT’s reputation as a leader in the hospitality sector is well-founded, with their extensive work with around 350 restaurants, pub groups, bars, and hotels across the UK, particularly in and around London. Their expertise in ethical tronc schemes, tax relief maximization, and team motivation and incentives is widely recognized and will complement Moore Kingston Smith’s existing offerings.

Similarly, Moore Kingston Smith’s global reach through the Moore Global network, helps clients to achieve lasting success at local, national and international level. This merger allows WMT to tap into Moore Kingston Smith’s expansive global network, offering their clients new opportunities and insights from international markets.

To find out more, contact the Corporate team.

The Sphering Group is a front-line player in flue and air care in Europe with a renowned expertise in design, manufacturing and distribution of innovative high-quality chimney and ventilation systems.

The Sphering Group wanted to expand its European presence with a location in the UK and targeted a competitor, SFL Ltd, previously part of the Stamm International Corp. who was the No. 2 manufacturer of flues and chimneys in the UK with well-established distribution in the USA and Far East.

Sherrards were introduced to Sphering Group via the London division of the French Chamber of Commerce and were quickly instructed to assist on the targeted acquisition of SFL.  

This was Sphering Group’s first targeted UK acquisition of a trading business, and the deal took almost two years to complete due to the cross jurisdictional nature and complexities in the company raised during the research phase and resulting in a complicated escrow fund held by J P Morgan on behalf of the parties and to cover against potential and significant risks of claims associated with the trading business. 

The acquisition was eventually successful and adds R&D capabilities and a sixth manufacturing plant to Sphering Group’s industrial capacities already operating in France, Italy, Belgium, Germany, and Poland. With the integration of SFL teams, the Group now employs 800 people across Europe.

 

To find out more, contact the Corporate team. 

 

 

Sherrards coordinated directly with Donlim and acted alongside a major law firm in China, as the transaction was subject to extensive negotiations, including requiring approval from the Chinese government. The transaction was completed in March 2023.

Donlim is headquartered in Shunde, Guangdon, China, and is a major manufacturer of home kitchen appliances and other electrical products, with over 28,000 staff and revenues of RMB 14.9 billion in 2021. Donlim wished to expand its portfolio of international brands by acquiring Morphy Richards, a well regarded British brand established in 1936, and for whom Donlim had been manufacturing products under contract for some time.  MRCA was, before the transaction, owned by Glen Dimplex, an Irish company, and has substantial operations in the UK in addition to other major markets in China, Ireland, Australia and New Zealand. Glen Dimplex retained the rights to the Morphy Richards brand in other key international markets. The transaction received significant press coverage in the UK and Ireland.

Following completion, Donlim has acquired a permanent presence in the UK and will use this as a platform to expand its consumer appliances offering in the UK market, as well as now having the benefit of an esteemed British brand to use in its operations overseas.

To find out more, contact James Crook. 

Franchising has been lauded as a tried and tested way of growing a business by using the entrepreneurial skills and capital (without incurring debt or interest charges) of others.  It has also sometimes misguidedly been promoted as a solution for ailing businesses. Leigh Head, gives his Top 10 Tips for any aspiring Franchisor and what they should look out for to grow a business.

1. Competition – Find out who is likely to be competing with you for franchisees. This means researching to see who is franchising not only a business which is similar to yours, but also what other franchises are available for sale at the sort of price you are proposing to charge for your franchise.  Not all prospective franchises are wedded to the idea of only selling goods or services of the type being provided by your franchise.  Many are concerned with starting their own business and approach franchising with an open mind, but with a good idea of what they can afford.  They will therefore be looking at franchises within their price range.

2. Franchisee selection – Establish and stick to your criteria for those whom you consider to be suited to operate your franchise – do not lower your standards in a moment of weakness. The temptation is very great to lower standards when recruiting the first few franchisees or when the growth in your network is not keeping pace with your expectations.  If you are forced to do so for sound commercial reasons, do so in the full knowledge that it is highly likely that these franchisees will become troublesome in the future.

3. The future – Ask yourself what are you doing now that will make your franchisees want to renew their franchise agreements when they expire.  Franchising is a long-term proposition and franchisors who do not look to the future will find that their franchise network will diminish in the longer term.

4. Two Businesses – As a franchisor you have two businesses.  The first consists of supplying goods or services to your customers via your company-owned units.  The second is that of franchising.  Do not forget that your franchisees are your customers and that your obligations as franchisor to your franchisees are different and a good deal more onerous than those to your customers.  Remember also that the customers of your franchisees are your customers too, albeit indirectly.

5. Management skills – Improve your management skills and those of your staff.  The management of a franchise network is an art – not a science.  The big challenge your staff (who will be employed) will face is managing franchisees who are not your employees, but independent business people in their own right.  Managing them as managers of a branch business will not bring the best out of your franchisees and will lead to confrontation.

6. Support – One of the key obligations of a franchisor is to support its franchisees to the extent that it is necessary to sustain them in their business.  To avoid disappointment and accusations that you fail to keep your promises, always under-promise and over-deliver.  In this way you will gain a reputation for doing what you promise and more often than not, more than what you promise.  Whatever you do, do not fail to deliver what you promise.

7. Exclusive Territories – If you are granting exclusive territories, ensure that you have the necessary protocols and mechanisms in place for dealing with turf wars which can break out amongst franchisees.

8. Performance Targets – If you impose minimum performance targets you must be able to justify their imposition and the basis upon which they are calculated.  Make sure that they are reasonably achievable and be prepared to impose such sanctions as you may have reserved in the event that they are not reached, otherwise you will lose credibility and have problems in enforcing targets when others fail to reach them.

9. Standards – Do not tolerate sub-standard franchisees – they affect the whole network and certainly their neighbouring franchisees.  Failure by a franchisee to comply with your “system” is a mortal sin.  Uniformity is the key.  The key to your success and that of your franchisees is uniformity of business practices, uniformity of marketing image and uniformity of the quality and manner in which products and services are delivered to customers.

10. Bad may be good – Remember that it does not necessarily follow that the most demanding franchisees are the worst franchisees. Often, it is the most demanding franchisees who are also the best in your network.  That may be a coincidence or it may be that it is precisely because they are demanding of themselves and good at what they do, that they are demanding.  Better to have a very demanding franchisee who is firing on all cylinders and growing his or her business like topsy, than to have a quiet, compliant franchisee who merely chugs along with a tendency to use you as a crutch.

Contact Leigh Head for more information.