On 5 May 2019, the Department for Business, Energy & Industrial Strategy published a consultation to reform corporate transparency. Generally, the consultation looks at guarding against the misuse of UK corporate entities and balancing transparency against the protection of personal data.
Part of the proposed reforms addresses the compulsory public disclosure of a UK director’s legal gender history on Companies House. At present, if a transgender director or person of significant control (PSC) of a limited company does not obtain legal recognition of their true gender until after their company is incorporated, Companies House will publicise both their previous name (commonly known as ‘dead name’) and current name.
The Legal Position
Gender Recognition Act 2004 (GRA)
Section 22 of the GRA makes it an offence to disclose the birth sex/assigned gender of someone who holds a Gender Recognition Certificate (GRC). In order for the disclosure to be an offence, the information disclosed must have been obtained in an official capacity.
The purpose of this offence is to facilitate personal control over the disclosure of one’s gender status. The law acknowledges that ‘coming out’ ought to be the choice of the individual, whilst aiming to protect against the serious and potentially fatal consequences when that choice is routinely taken away.
At the time of writing, there have been no recorded convictions under section 22. Its main impact has come in the form of reactive procedure and awareness. For instance, before disclosure in legal proceedings, GP records are now corrected to remove any reference to the gender/sex the individual was assigned at birth before obtaining a GRC, unless that information is strictly relevant.
However, the exceptions to section 22 have prevented some changes in procedure, including that of Companies House. In particular, section 22(4)(j) exempts disclosure made in accordance with another enactment.
Companies Act 2006 (CA)
The Companies Registrar must make available all information held on the public register unless they are specifically forbidden to do so by section 1087 of the CA. The Government has confirmed that a director or PSC’s dead name is not forbidden by section 1087 and therefore falls under the exemption in section 22(4)(j).
Transparency of UK Limited Companies
The consultation sets out that the reason UK limited companies are subject to a high standard of transparency is due to the limited liability shareholders and directors enjoy.
The same reasoning supports privacy for the legal gender history of UK directors and PSCs. While the proposed reform requires Companies House to retain a director’s legal gender history for the purposes of a criminal investigation, the same information is commonly irrelevant for civil proceedings.
Should a claimant use Companies House to locate a potential defendant, that defendant will usually be the company itself, making the current director’s details only relevant for correspondence. Even if a claimant is looking to pursue a director personally, they will not usually need their previous names to do so, even if the subject of the dispute occurred while the director commonly used their dead name.
Should any confusion arise (if, for instance, a director signs their dead name on behalf of a company but that name is not recorded as a director with authority), the potential claimant may be able to enquire with Companies House. Disclosure in these circumstances will likely be exempt from section 22 by virtue of section 22(4)(e), which allows disclosure for the purposes of proceedings before a court. This scenario also assumes potential dishonesty on the part of the director, making it even less likely.
Responses to the Consultation
If you or your business wish to provide a comment on the consultation, the online response survey can be found here: https://beisgovuk.citizenspace.com/business-frameworks/corporate-transparency-and-register-reform/