This week:

• Companies House publishes new guidance on its approach to enforcing mandatory identity verification
• The FCA approves JP Jenkins as the second platform operator within the new PISCES share trading framework
• The Government has published updated non-statutory guidance on the UK’s PSC regime
• The Financial Reporting Council publishes its annual review of corporate governance reporting
• Other items this week

Companies House sets out approach to non-compliance with mandatory identity verification

Companies House has published new guidance explaining how it intends to use its enforcement powers to ensure compliance with new mandatory identity verification (IDV) requirements that came into force this week.

From 18 November 2025, individuals who become a company director, limited liability partnership (LLP) member or registrable person with significant control (PSC) are required to verify their identity if they have not already done so.

Transitional provisions apply to individuals who were already a company director, LLP member and/or registrable PSC at the end of 17 November 2025. These individuals will effectively have their own personal deadline for completing IDV, which could be very soon or as far away as November 2026.

Acting as a company director or LLP member while unverified is a criminal offence (and the company or LLP and its other officers may also commit an offence). Similarly, it is a criminal offence for a PSC to fail to complete IDV when required by Companies House.

An individual can complete IDV directly with Companies House or indirectly through an authorised corporate service provider (ACSP).

Companies House has said it will apply its four-pronged approach when enforcing IDV requirements. This includes:

• informing people of their obligations to complete IDV;
• nudging and guiding them (where appropriate, timely and practicable);
• dealing with non-compliance; and
• addressing fraud and criminal activity.

If an individual does not complete IDV by the required deadline, Companies House will send a letter warning that it may pursue enforcement action.

Actions open to Companies House include criminal prosecution through the courts, referring the matter to the Insolvency Service (which could, in turn, result in disqualification from acting as a director), and imposing financial penalties. Companies House will select the most suitable enforcement approach based on various factors set out in the guidance, with prosecution reserved for “serious” cases.

Companies House will provide a timeframe for individuals to make representations if there are “extenuating circumstances” for non-compliance. It will not consider representations made outside that timeframe, and its decision on enforcement will be final.

PSCs must verify their identity within 14 days of being required by Companies House. Companies House may extend this period by any number of further 14 day-periods. The guidance suggests that Companies House will, at the request of the relevant individual, extend the period up to two times before referring the matter to an examiner and requiring evidence of difficulty with complying.

Read more about mandatory identity verification (IDV) in our previous Corporate Law Update

Read the new Companies House guidance on enforcement of mandatory identity verification

Read the Companies House guidance on verifying your identity

Access the Companies House form to apply to extend the deadline for new PSC identity verification

Access the Companies House form to make a representation for failing to complete identity verification

FCA approves second firm to operate a PISCES trading platform

The Financial Conduct Authority (FCA) has announced that matched bargain operator JP Jenkins has been given approval to operate a platform within the new PISCES sandbox.

The PISCES (short for Private Intermittent Securities and Capital Exchange System) sandbox is a new framework to allow sophisticated investors to buy and trade securities in public and private companies in a controlled environment away from the primary capital markets, subject to a more proportionate disclosure and market manipulation regime.

The sandbox creates a new regulatory perimeter within which operators can establish their own platform (known as a PISCES). Securities on a PISCES will trade intermittently during so-called “trading windows” set by the PISCES operator.

The PISCES perimeter is operating initially in a financial services “sandbox” so that it can be properly assessed in controlled conditions. The Government will then decide whether to make it permanent.

JP Jenkins is the second organisation to receive approval to operate a PISCES, after the FCA granted permission in August 2025 to the London Stock Exchange to launch its new Private Securities Market.

Alongside the approval, JP Jenkins has announced the launch of its new Private Market, the second PISCES within the sandbox, and is accepting applications to join the market.

Unlike JP Jenkins’ current platform, which operates on a “matched bargain” basis, its Private Market will make use of PISCES’ intermittent trading window and scheduled auctions format. Companies will be required to disclose information prior to an auction, with trades executed through brokers and intermediaries approved by JP Jenkins.

As expected, companies joining the JP Jenkins Private Market will not need to publish a prospectus, instead making a set of core disclosures that will be made available to eligible buyers. It will not be possible to raise new money through the Private Market via an initial public offering (IPO).

Companies on JP Jenkins’ existing platform will also be eligible to join its Private Market, provided they meet the relevant eligibility criteria.

JP Jenkins has announced it will be providing further updates on launch timelines and onboarding processes in the coming months.

Read the FCA’s announcement that it has approved JP Jenkins as a PISCES platform operator

Read JP Jenkins’ FAQs on its new Private Market within the PISCES sandbox

Government publishes updated PSC guidance

The Government has published updated versions of its non-statutory guidance on the UK’s persons with significant control (PSC) regime.

The updates follow the introduction of mandatory identity verification (IDV) for registrable PSCs, and the abolition of “local” PSC registers, on 18 November 2025.

The non-statutory guidance has no legal status and is designed to assist both PSCs and entities with complying with the regime. The guidance is split into a high-level summary, specific guidance for legal entities, and specific guidance for PSCs.

The Government has not yet updated the statutory guidance on the meaning of “significant influence or control” over a company or a limited liability partnership (LLP). This guidance, which has a degree of legal status, must be approved by Parliament. The Government’s website indicates that it intends to update this guidance in January 2026.

The Government has, however, updated its non-statutory guidance on the meaning of “significant influence or control” over an eligible Scottish partnership.

Access the Government’s collection of guidance on the PSC regime

Read the Government's updated non-statutory guidance for individuals who may be PSCs

Read the Government’s updated non-statutory guidance for legal entities on the PSC regime

FRC publishes annual review of corporate governance reporting

The Financial Reporting Council (FRC) has published its annual review of corporate governance reporting for 2024/2025.

The review covers reporting by 100 randomly selected companies that follow the FRC’s UK Corporate Governance Code.

This is the final review of compliance with the 2018 version of the Code. The 2024 version of the Code came into effect on 1 January 2025 (other than Provision 29 of the 2024 Code, which comes into effect on 1 January 2026). From next year, the FRC will review compliance against the 2024 version of the Code. References below to Code Provisions are to provisions of the 2018 Code.

The FRC reports the following findings from its review.

• Overall compliance. The number of companies that departed from at least one provision of the Code fell again in 2024/2025, down to 25 from 28 in 2023/2024. However, this still represents a significant decrease from previous years (63 companies in 2022/2023). The review notes that the FRC “welcomes departures from provisions of the Code where companies provide clear, meaningful and context-specific explanations for their approach”.

• Pension contribution alignment. There was a continued increase in compliance with Provision 38, which relates to the alignment of executive pension contributions with those of the wider workforce, with only 3 companies explaining a departure.

• Audit committee composition. By contrast, there was an increase in departure from Provision 24, which requires the audit committee to comprise solely non-executive directors (NEDs) and (for larger companies) to have at least three members. However, the FRC notes that most departures were temporary due to board changes and reflected transitional arrangements.

• Board evaluation. There was a rise in departures from Provision 21, which recommends an externally facilitated board evaluation at least every three years. All companies in question explained that they had implemented alternative arrangements, although the FRC notes that it would be helpful if departures from this Provision could confirm that an external review will be undertaken in the following year. The report provided an example of a “robust” explanation.

• Other departures. Other Provisions from which companies commonly departed included Provision 9, which requires the chair to be independent on appointment and not to combine the roles of chair and CEO, and Provision 19, which sets a limit of nine years for the chair’s tenure. As in previous years, there were also departures from Provisions 11 and 32, which concern the composition of the board and remuneration committee.

• Workforce engagement. For the purposes of Provision 5, most companies (61 of those reviewed) continued to designate a NED with workforce responsibility. 19 companies used a workforce advisory panel (either alone or alongside a NED) and 15 used a method of engagement not suggested by the Code. No company appointed a director from the workforce. Interestingly, 77 companies disclosed some form of direct face-to-face engagement between the board and the workforce, although only 25 companies provided detail on the topics discussed.

• Other stakeholder engagement. The FRC states that most companies did not report any direct board engagement with other stakeholders, with engagement mainly carried out by management with feedback delivered to the board. The FRC recommends that companies consider providing a summary of board engagement activities and any outcomes.

• Artificial intelligence. In an expanding area of reporting, the FRC notes that 11 companies stated they had a dedicated AI committee or had reviewed their code of conduct to include a section on AI. 10 companies stated that the board had access to AI expertise, with some reporting the members of the board themselves had expertise. Only 1 company mentioned using AI in reporting itself, although the report suggests more companies may be using AI to enhance existing corporate reporting.

The FRC has expressed a desire for greater focus on ensuring annual reports are as concise as possible, encouraging companies to assess the volume and relevance of disclosures, and to streamline content to the most material strategic and governance considerations. 

Read the FRC’s 2025 review of corporate governance reporting (opens PDF)

Access the FRC’s UK Corporate Governance Code (2018 edition) (opens PDF)

Access the FRC’s UK Corporate Governance Code (2024 edition) (opens PDF)

Other items this week

• IA publishes 2025 letter to remcom chairs. The Investment Association (IA) has published its 2025 letter to the chairs of remuneration committees. The letter confirms there will be no changes to the IA’s Principles of Remuneration in 2026, instead highlighting areas in which companies can improve implementation. These include providing company-specific rationales for remuneration proposals, using benchmarking and peer comparisons for remuneration increases, and taking a cautious approach to “hybrid schemes”. Read more about the IA’s letter in our colleagues’ separate in-depth piece.
  
  Read the Investment Association’s 2025 letter to remuneration committee chairs (opens PDF)

• FRC publishes review of reporting by smaller listed companies. The Financial Reporting Council (FRC) has published a thematic review of financial reporting by smaller listed companies. The study took the form of a desktop review of 20 publicly traded companies that sit outside the FTSE 350, focusing on revenue, cash flow statements, impairment, and financial instruments.
  
  Read the FRC’s thematic review of financial reporting by smaller listed companies (opens PDF)