The Economic Crime and Corporate Transparency Act (ECCTA) 2023

As we enter 2024, the business landscape is evolving at a rapid pace, accompanied by increasingly stringent regulations to combat economic crime and ensure corporate transparency. Understanding and complying with these regulatory changes can be daunting for businesses, but it is essential to maintain trust and protect company reputation.

In this article, we will explore the significant implications of the Economic Crime and Corporate Transparency Act 2023, effective from 4 March 2024, and how our management consulting company can assist businesses in adapting to this change.

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Enhancing Compliance and Risk Management:

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The Economic Crime and Corporate Transparency Act 2023 introduces several critical amendments to company law that businesses need to be aware of. From enhanced AML (Anti-Money Laundering) measures to greater shareholder transparency and strengthened due diligence requirements, businesses are now facing a more complex regulatory environment.

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Key Features of the ECCTA:

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1. Enhanced Corporate Transparency:

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a. Companies are now obligated to maintain and regularly update a beneficial ownership register, providing detailed information about individuals who exercise significant control or have ownership rights in the company.

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b. The register must be accessible to law enforcement agencies, regulatory authorities, and certain other entities.

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c. Non-compliance with the beneficial ownership disclosure requirements may result in substantial penalties and potential criminal liability.

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2. Strengthened Anti-Money Laundering (AML) Provisions:

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a. The ECCTA imposes stricter AML obligations on companies, including the requirement to conduct enhanced due diligence on high-risk customers, transactions, and countries.

 

b. Companies should implement robust AML policies and procedures, conduct regular risk assessments, and ensure adequate internal controls to mitigate the risk of money laundering and terrorist financing.

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3. Expanded Corporate Criminal Liability:

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a. The Act extends corporate criminal liability to include certain economic crimes committed by senior management, employees, or other individuals acting on behalf of the company.

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b. Companies should implement effective compliance programs, including risk assessment, prevention measures, monitoring, and reporting mechanisms to prevent economic crimes within their organisation.

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4. Increased Reporting Requirements:

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a. Companies will be required to submit annual reports detailing their efforts in combating economic crimes and complying with the ECCTA regulations.

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b. Reporting should include information on the implementation of risk assessment procedures, training programs, AML controls, and compliance measures.

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Conclusion:

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The ECCTA 2023 introduces significant changes in company law aspects concerning economic crimes and corporate transparency. Companies should proactively prepare by establishing beneficial ownership registers, enhancing AML measures, strengthening compliance programs, and fulfilling reporting requirements. By doing so, companies will ensure compliance with the new regulations and protect themselves from potential penalties and liability.

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How AVUKE Can Help

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The Economic Crime and Corporate Transparency Act 2023 poses both challenges and opportunities for businesses seeking sustainable growth and compliance. With our expertise in strategic compliance, legal, and risk management, we are well-positioned to assist companies in navigating these changes successfully. By offering tailored solutions to address the various requirements outlined by the Act, we enable businesses to foster trust, safeguard their reputation, and maximise their growth potential.

 

• We are well-equipped to guide companies through these changes, enabling them to fulfil their obligations while optimising business growth opportunities.

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• Our team of experts can conduct comprehensive reviews of existing AML frameworks, identify gaps, and recommend tailored solutions to ensure compliance. By conducting thorough risk assessments, implementing robust KYC (Know Your Customer) procedures, and facilitating employee training, we empower businesses to minimise their exposure to illegal activities.

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• Our consulting firm can assist companies in meeting this obligation by offering support in the implementation of efficient systems for capturing, managing, and verifying beneficial ownership information. By leveraging our expertise, businesses can comply with these requirements seamlessly while minimising administrative burdens.

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• Our management consulting team can guide businesses in designing and implementing robust due diligence procedures, tailored to individual risk appetites and industry-specific challenges. This proactive approach allows businesses to protect themselves from reputational damage, financial loss, and legal ramifications.

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Together, let us embrace these changes as catalysts for innovation and progress. AVUKE is your trusted partner in strategic compliance, legal, and risk management. Contact us today to learn how we can help your company thrive in the changing regulatory landscape.