Important Land Registry update for overseas companies holding England and Wales property
All England and Wales property lawyers and foreign lawyers opining on England and Wales property transactions should take note of the new Land Registry practice guide 78, and ensure that foreign legal opinions now include an additional confirmation as to the continued existence of the company since holding title to the property.
As some lawyers may already have experienced, recently the Land Registry has on occasion been raising requisitions requiring foreign legal opinions to be provided, specifically confirming that foreign companies applying to register dispositions of property situated in England and Wales have not been dissolved since taking ownership of the property, even if they have subsequently been restored.
Based on recent Land Registry practice, the requirement would appear to extend to the registration and enforcement of fixed legal charges.
In its new practice guide 78, the Land Registry has clarified the position as follows:
“Note: the legal effect on registered titles [which could be termination for example] owned by overseas entities that cease to exist happens automatically and is not then automatically reversed if the entity is later revived or restored under the law of the territory that governed the entity when it ceased to exist.
If we are asked to register a disposition of a registered title by an overseas entity, we may ask the applicant to provide evidence to establish that the entity had a continuous existence from the date on which it was first registered as proprietor of the title until the date of the disposition to be registered (even though it may subsequently have been wound up and dissolved). We will usually rely on a legal opinion letter from a suitably qualified lawyer in the relevant jurisdiction confirming that this has been the case.
When applying to register a disposition affecting land owned by an overseas entity, you must tell us if you believe the entity may have ceased to exist in its jurisdiction of incorporation at any time after it became the registered proprietor. This includes a change of domicile from the jurisdiction shown in the register but does not include a status change occurring after the disposition if the registration of that disposition will remove the entity as proprietor.”
Note that the Land Registry has made it clear that “Foreign laws that provide that the restored entity is to be treated as if it had never ceased to exist generally have no effect under English law”.
Following the publishing of the new Land Registry guidance, the prudent approach for England and Wales lawyers, and foreign lawyers opining on England and Wales property transactions, must be to ensure that an opinion is given as to the continued existence of the foreign company throughout its ownership of the property.
At Spencer West, we regularly issue foreign legal opinions to the Land Registry and to other parties with respect to England and Wales property transactions involving BVI and other offshore companies. Please contact Karen Gilbert or your usual Spencer West contact for an instant fixed fee proposal for a BVI or other foreign legal opinion. Please also contact us for general advice where, for example, a foreign company may have been dissolved and restored during the period of its property ownership.
