Government shelves Companies House six-year data wipe plan
Controversial plans for Companies House to delete records of dissolved companies after six years rather than the current 20-year threshold have been shelved, the government has confirmed to CCH Daily
7 Mar 2017
Under the plans, accountants including insolvency practitioners and mergers and acquisitions advisers would have been denied access to key historical records, potentially concealing evidence of wrongdoing and incompetence by directors.
The move had the potential to make it harder for directors’ track records to be assessed. A litany of company failures is often considered a warning sign about a director, but had the plans gone ahead, only a relatively small snapshot of a director’s past would be available should the proposals go ahead.
It is estimated approximately 2.5 million records were under threat. The proposal was primarily driven by data protection concerns and complainants citing the right to be forgotten. Complaints have risen significantly since Companies House moved to a free service in 2015.
Police investigators, the National Crime Agency, the Serious Fraud Office, lawyers, journalists and bank compliance teams all make extensive use of the data in the course of their work.
Caroline Sumner, technical director at insolvency and restructuring trade body R3 welcomed the news that the proposals ‘hadn’t left the drawing board’.
She said: ‘The Companies House records are an essential resource for the insolvency and restructuring profession and they make it much easier to investigate directors and return money to creditors. Deleting data older than six years would have seen a lot of trails go cold and evidence of a director’s historical wrongdoing or a dissolved company’s assets would have been lost.
‘It can often take years for suggestions of wrongdoing, reports of extra assets, or claims available to a company to come to light. The longer insolvency practitioners have the ability to call up information about a company, or even resurrect a company, the better.’
In a statement to CCH Daily, Companies House said: ‘The government has no current plans to bring forward proposals to reduce the period of time that Companies House retains records of dissolved companies.
‘We will continue to keep the retention period under review. Any future proposal to change the retention period would be subject to public consultation but there are no current plans to do this.’