Agents need to be ready to implement new measures aimed at cracking down on foreign criminals using UK property to launder money.

The requirements under the Register of Overseas Entities (ROE), which come into force next week, mean that anonymous foreign owners of UK property will have to reveal their real identities.

Designed to ensure criminals cannot hide behind secretive chains of shell companies, the rules are backed up with criminal prosecution threatened for any breaches.

Other sanctions include restrictions on registering or disposing the title of land.

Difficult to hide

The register will make it more difficult for Putin’s wealthy oligarch supporters to hide their ownership of properties in the UK and particularly London.

Largely thought to have been kicked into the long grass, the register was given new impetus by Russia’s invasion of Ukraine in February, and will be introduced under the Economic Crime Act 2022.

Unusually, the register will be applied retrospectively to property bought up to 20 years ago in England and Wales and since December 2014 in Scotland.

The Law Society issued a warning that the ROE does not require the same checks as anti-money laundering legislation, so it is important to check what is needed.

Nathan Emerson, CEO of Propertymark, (pictured) says: “We’re yet to see the technical guidance about how the Register of Overseas Entities will work in practice, but agents should be able to use what information has been published to ensure they will be able to meet the criteria when it does go live.

“Agents may already have a pipeline with overseas entities’ properties in it and this is something they could proactively get the ball rolling on once the register is open. There is a risk that if they don’t they could potentially see transactions fall through,” he says.

“They may also need to consider some additional contractual provisions when dealing with land and property in overseas ownership to minimise the risk to buyers and sellers, for example to ensure they are provided with an Overseas Entity ID number through Companies House within a specified timeframe before completion.”