Much has been said about The Economic Crime (Transparency & Enforcement) Act 2022 ("ECTEA") coming into force, particularly as we near the end of the transitional period, the deadline of which is 31 January 2023.

The key points for lenders and insolvency practitioners from a Scottish and English and Welsh perspective to be aware of are:

  • ECTEA was enacted in an effort to bring more transparency to land ownership within the UK and address money laundering concerns;
  • it applies to England and Wales, Scotland and Northern Ireland;
  • it introduces a new register – the Register of Overseas Entities ("RoOE") which requires overseas entitles that own property in the UK to register who their "beneficial owners" are at Companies House and keep the register updated;
  • a beneficial owner is an individual or entity that has a significant influence or control (as defined in the ECTEA) over an overseas entity;
  • there are certain conditions to be met for registration on the RoOE and there also are exemptions within the ECTEA as we will discuss below;
  • the ECTEA does not apply to all property; it applies to "qualifying estates" which triggers the requirement for registration on the RoOE before the end of the transitional period and is defined depending on the jurisdiction:
    • a. in England and Wales, a qualifying estate is any Land Registry title (freehold or a leasehold) where the owner applied for registration of their ownership at HMLR on or after 1 January 1999 or before 1 August 2022;
    • b. in Scotland, a qualifying estate is any Land Register title (ownership or lease) held by an overseas entity registered from 8 December 2014 onwards.
  • it applies retrospectively so lenders in particular should consider the ramifications not only on new secured lending but also consider the implications on existing loans
  • failure to comply with the ECTEA may be a criminal offence.

Please note that for the purposes of this article we have only considered the ECTEA from a Scottish and English and Welsh perspective.


The key implications ahead of 31 January 2023 are to make sure that all overseas entities which own a qualifying estate are registered before the deadline and to watch this space regarding the exemption for insolvency practitioners dealing with overseas entities which we discuss in detail later in this section. Registration on the RoOE is going to impact registration of security for lenders and affect insolvency practitioners ability to deal with a property. From the 1 February 2023, overseas entities will not be able to grant security over property without committing an offence so this will affect the ability to not only do new deals but also affect refinancing of existing borrowings unless the overseas entity has complied with the ECTEA or is exempt. If the overseas entity has not registered in time, this will likely trigger the default provisions under the loan agreement.

The key thing lenders need to be aware of is how the relevant land register is dealing with the RoOE as if this isn't considered, they will not be able to register their charge.  In England and Wales, this is being protected in terms of land registration by a restriction on title being added to the title to the property and will prevent the registration of a transfer, grant of a lease for a term of 7 years from the date of grant or charge unless the overseas entity is registered at the RoOE (if applicable) or an exemption applies or certain conditions are met. In England & Wales it would be a criminal offence for an overseas entity to immediately dispose (e.g. grant a charge or sell on or grant a lease) without compliance with the conditions that would get the overseas entity around a restriction.

In Scotland, there is no Scottish equivalent of a restriction on title however the Keeper of the Registers of Scotland is obliged to reject applications dealing with overseas entities unless certain conditions are met. Additionally in Scotland, it is an offence to deliver a deed signed by an overseas entity that isn't registered in the RoOE (where required).

The PDF table sets out the conditions referred to above and which jurisdiction they apply to. If any of the below conditions apply, then the registration of the relevant deed will not be prevented.

It would be remiss not to note that the terms "specified circumstances" and "specified insolvency practitioner" referenced in the PDF table are described in regulations made by the Secretary of State or Scottish Ministers, as applicable. We would flag that at the time of this article, the regulations referred to are still making their way through Parliament and it's unclear what will constitute a "specified circumstance" or "specified insolvency practitioner" and there is a gap in the legislation. This means that it is unclear if all types of insolvency practitioners will fall into the definition in the ECTEA (i.e., LPA receivers, liquidators, administrators, etc.) and whether "specified circumstances" only relate to selling the property or if it will also include other duties insolvency practitioners have such as trading from the property in order to comply with insolvency legislation.


The first thing to check is whether an overseas entity is involved in a transaction and if they are required to be registered on the RoOE. From there, the RoOE can be accessed by anyone online and can be checked to see if the overseas entity is registered. If they are not registered, they have until 31 January 2023 which signifies the end of the transitional period.

To avoid any delays in completing a transaction which can't go ahead without the relevant overseas entity being registered on the RoOE, we recommend that registering in the RoE is done as soon as possible during a transaction particularly now that the deadline is fast approaching.


In summary, lenders should ask themselves at the outset of any transaction moving forward whether an overseas entity is involved, whether the transaction will be caught by the legislation, whether exemptions apply and what steps need to be taken to ensure compliance.

Insolvency practitioners will need to be aware of this as the market assumes that the legislation won't catch insolvency practitioners and they will be exempt however we are monitoring this very carefully whilst the regulations make their way through Parliament.

For further information please see our article from earlier this year and for any advice or for more information please contact:

Key Contacts

Addi Spiers

Addi Spiers

Partner, Restructuring/Finance
Edinburgh, UK

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Jennifer Claydon

Jennifer Claydon

Associate, Restructuring

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