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What Are the Control Conditions for PSC?

Rachel Blacklock
  • Updated

When addressing the PSC requirements, a company is looking to see if there’s anyone who meets one or more of the following conditions:

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  1. They hold more than 25% of the company’s shares
    2. \n
  2. They hold more than 25% of the company’s voting rights
    3. \n
  3. They have the power to appoint or remove a majority of the company’s board.
    4. \n
  4. They have the right to exercise or actually exercise significant influence or control over the company.
    5. \n
  5. They have the right to exercise or actually exercise significant influence or control over a trust or a firm that is not a legal entity which itself satisfies any of the first four conditions.
    6. \n

To the extent that is reasonable, companies must consider the existence/application of any shareholder agreements or enhanced voting rights attached to any particular share class.

Note: Inform Direct cannot offer specific advice. If you are unsure which control reason applies, please seek professional advice.

\nNote: Directors are specifically excluded from Control Condition 4 above. However, the same director may need to be included as a PSC if they satisfy any of the above conditions in another capacity e.g. by virtue of a shareholding.

Can a trust itself be a PSC?

No. A trust has no legal personality, so it can never be registered as a PSC or RLE in its own right. If a trust's holding would otherwise meet the shareholding, voting rights, or right to appoint or remove a majority of directors control reasons, each trustee is instead recorded as the PSC, in their own capacity as a known individual (or as an RLE if the trustee is a company). Because trustees hold on behalf of the trust jointly, each trustee is treated as holding the trust's entire shareholding or voting rights, not a split share. If there is more than one trustee, every trustee must be added as a PSC.

The significant influence or control over a trust or firm without legal personality reason is separate from the four reasons above. It applies to someone such as a settlor, protector, or beneficiary who has significant influence or control over the trustees themselves, in addition to the trustees' own PSC entries, not instead of them.

If an individual is already recorded as a PSC through another shareholding and their shares are later identified as held on trust, there is no need to remove and re-add them. Simply update their nature of control to reflect the trust arrangement.

For worked examples, see Trusts and Inform Direct.