What Is the Economic Crime and Corporate Transparency Bill

Businesses based in the UK must stay ahead of any changing regulations to avoid hefty penalties and ensure compliance is always met. One of the latest legal developments in the business world is the Economic Crime and Corporate Transparency Act 2023 (also known as ECCTA). 

The Economic Crime and Corporate Transparency Bill is a relatively new piece of legislation which has recently been introduced in the UK, aiming to tackle money laundering and other forms of economic crime. In this blog, we'll give you all the information you will need to know about ECCTA, as well as its implications for businesses, helping you to navigate these changes easily.

If you'd like to see how SmartSearch can help your business comply with the law, we offer a wide range of solutions. Speak to an AML expert today to find out more about our award-winning platform

What is ECCTA?

The Economic Crime and Corporate Transparency Act 2023 (ECCTA) is an important piece of legislation that was first introduced by the British government in 2023. However, the legal provisions did not come into force straight away. Instead, the majority of the changes from ECCTA came into force on March 25th 2025, although some changes were introduced beforehand. 

The main aim of the Economic Crime and Corporate Transparency Bill is to combat the rising threat of financial crime and enhance corporate transparency. The Act builds upon the foundations laid out by the Economic Crime (Transparency and Enforcement) Act 2022, which was primarily introduced as a response to the Russian invasion of Ukraine. The 2022 legislation tightened sanctions and improved the identity verification processes of beneficial owners of overseas business entities.

ECCTA was created to address growing governmental concerns over economic crime, looking particularly at the following factors:

• Fraud,

• Money laundering,

• The misuse of UK corporate structures.

Essentially, the new ECCTA legislation aims to take the steps made in the 2022 legislation further, introducing several new measures to reduce the risk of financial crime. It is also hoped that the new act will make the data held by Companies House much more accurate and transparent.

What Are the Key Provisions of the Economic Crime and Corporate Transparency Bill?

The Economic Crime and Corporate Transparency Bill covers several key provisions that businesses based in the UK need to be aware of:

1. Companies House granted advanced powers: ECCTA will grant Companies House a range of new powers to verify the identity of both company directors and people with significant control (PSCs). They'll also be able to reject business filings that contain inaccurate, false or misleading information.
2. Greater transparency: Another key provision of ECCTA is that it increases transparency. The act introduces several new requirements for companies to disclose additional information about their control structures and central ownership - for example, providing additional information about shareholders and PSCs.
3. Strengthened anti-money laundering (AML) measures: ECCTA also introduces stricter anti-money laundering requirements for businesses. These measures include enhanced due diligence checks and the need for more accurate record-keeping tasks for businesses.
4. New offences and legal penalties: ECCTA creates a set of new criminal offences for businesses that don’t comply with the provisions of the act, including failing to prevent economic crime. Tougher penalties have been introduced for people found guilty of economic crimes, including much larger fines and longer prison sentences.
5. Limited partnership reforms: The act also includes a series of regulation reforms for limited partnerships, aimed at preventing them from being misused for illicit purposes.

How Will ECCTA Affect Your Business?

Now that you have an understanding of the Economic Crime and Corporate Transparency Bill, it's crucial that you learn how the new legislation could affect your business. 

The changes will likely require you to review and update your internal compliance processes, so we've compiled a list of the main areas in which the new legislation will likely have an impact:

An Increased Compliance Burden

One of the most immediate effects of the new Economic Crime and Corporate Transparency Act is the increased compliance burden it places on businesses. Companies based in Britain will be increasingly required to disclose more information about their control structures and the ultimate beneficial ownership of their business - as well as enhanced due diligence checks (for anti-money laundering purposes). 

This means that your business will need to put more time, money and resources into ensuring you’re fully compliant with the new regulations. Failing to do so could result in significant legal penalties, including fines, prison time and criminal prosecution. Please see our 2025 Compliance Checklist for more information.

Changes to Companies House Filings

ECCTA also grants new powers to Companies House, enabling them to verify the identity of PSCs and reject filings that contain fraudulent, inaccurate or misleading information. 

These new powers make it especially important for your business to ensure all information submitted is accurate, as you may otherwise face penalties. 

Enhanced Due Diligence Requirements

Another aspect of the Economic Crime and Corporate Transparency Bill that could affect your business is that it introduces stricter AML requirements, including enhanced due diligence checks. To ensure your business is not inadvertently facilitating money laundering and financial crime, you’ll likely need to conduct more thorough checks on your customers and their transactions.

This process may involve obtaining extra data about things like customer fund sources, as well as reviewing customer records on a more frequent basis. If suspicious activity is noticed, you also need to ensure you have robust reporting systems in place to deal with the issue immediately.

New Criminal Offences and Penalties

ECCTA also creates a variety of new criminal offences for failing to comply with the act's provisions, which includes the failure to prevent economic crime. This could have a major impact on your business, as it means that you could face criminal prosecution if you have failed to take adequate steps to prevent financial crime.

Additionally, the legislation also introduces much tougher legal penalties for those found guilty of these crimes, such as hefty fines and longer prison sentences. These new offences and penalties show the importance of ensuring that your business is fully compliant with the new regulations.

Reforms to Limited Partnerships

The last major part of the Economic Crime and Transparency Act that could affect your business is the reforms to the regulation of limited partnerships, which aims to prevent their misuse for illicit and fraudulent purposes. This could have implications for businesses that operate as limited partnerships - particularly those in the financial services sector.

Limited partnerships will now be required to provide greater information about their activities and partners. Companies House will also have enhanced powers for investigating and dissolving limited partnerships that are involved with illicit activities.

How Can SmartSearch Help You Navigate the Economic Crime and Transparency Act?

At SmartSearch, we offer a broad range of innovative services and solutions that can help you navigate the complexities of ECCTA with ease. Our comprehensive selection of solutions is specifically designed to help businesses stay compliant with the law:

• Digital identity verification solutions: Verifying the identity of potential customers is an important part of adhering to ECCTA, ensuring your company doesn’t accidentally facilitate economic crime. We make the process quick and easy using a range of trusted data sources.

• Companies House integration: We offer seamless Companies House integration, making it much easier to submit accurate information to the register. This is particularly important with ECCTA’s focus on Companies House data, ensuring you remain compliant with the new regulations.

• AML compliance services: As ECCTA introduces stricter anti-money laundering requirements, it’s important your business is kept up to date. Our AML compliance solutions can help your business meet the new requirements, including enhanced due diligence checks.

• Training and support requests: Compliance is a team effort, which is why we offer a wide variety of training and support services for your business. We can help your team stay compliant and up to date with the latest regulatory requirements, including ECCTA.

If you’d like to find out more about our training sessions, please visit our dedicated E-Learning page.

Ensure Full ECCTA Compliance with SmartSearch

Understanding how the new Economic Crime and Corporate Transparency Bill could affect your business is crucial for ensuring you stay compliant with the law. 

The Economic Crime and Corporate Transparency Act represents a significant shift in the way the UK approaches economic and financial crime. Not only does ECCTA introduce a new series of regulations and obligations for modern businesses, but it can also help you employ stricter anti-money laundering measures and achieve greater corporate transparency.

At SmartSearch, we’re one of the UK’s fastest-growing tech companies, committed to helping businesses navigate the new legislation with ease. We offer a comprehensive range of business solutions through our platform that are specifically designed to meet the latest regulatory requirements.

Don't let the complexities of the new ECCTA regulations affect your company negatively. Instead, contact SmartSearch today to get a demo and find out how we can help your business stay compliant and secure.