Sanctions screening for company formation agents and TCSPs

The formation order is only the starting point

A newly proposed company name tells you little about the people behind an order. A formation request may come from a founder, an intermediary or an existing group, and the person paying the invoice may not be the intended owner. Build your review around the relationship being created, not just the name to be registered.

HMRC’s TCSP guidance covers more than incorporation: relevant activities include registered-office services and certain director, trustee and nominee arrangements. AML supervision requirements should be checked separately; running a sanctions search does not establish that a provider is correctly registered or supervised.^[1]

Our recommended intake record begins with four questions: who is instructing you, on whose behalf, what service is requested and who benefits from it? Record the answer in plain language. If it is not clear enough for a colleague to explain, a list of search results will not repair the gap.

Identify the end client when an intermediary places the order

HMRC highlights that chains of intermediaries and nominee arrangements can obscure the people behind a structure. Its risk guidance recommends understanding the commercial reason for the services and the supply chain. An intermediary’s involvement is context for enquiry, not proof of wrongdoing.^[2]

Ask for a relationship map that separates the instructing party, proposed company, owners, controllers and any relevant existing entities. Keep supporting documents connected to the role they explain. A passport may help identify a person; it does not, on its own, explain why that person can instruct you for a company.

For repeat intermediaries, do not let familiarity replace the end-client review. Decide what information must arrive with each order, which changes trigger a fresh review and who follows up missing evidence. Keep the intermediary’s due-diligence assertions distinguishable from facts your firm has independently established.

• Identify the instructing party and the intended end user of the service.
• Capture legal names, available identifiers, jurisdictions and the requested services.
• Map the proposed owners, controllers and any nominee or intermediary relationships.
• Explain the commercial purpose and flag gaps before treating the order as ready.

Do not confuse PSC reporting with sanctions ownership tests

Companies House’s people-with-significant-control guidance includes holdings of more than 25% of shares or voting rights, alongside other conditions. PSC information is useful input for understanding a company; it is not a sanctions clearance certificate.^[3]

OFSI’s ownership and control guidance includes more-than-50% ownership or voting rights, board appointment rights and wider control tests. An unlisted entity can still be affected. Do not substitute a PSC percentage for the applicable sanctions analysis.^[4]

Separate two tasks in your file: identifying who may own or control the entity, and deciding what sanctions consequences follow. The first may use company records, documents supplied by the client and further enquiries. The second needs an assessment of the applicable rules and facts. A diagram of ownership is evidence to review, not a legal conclusion generated by its appearance.

Screen the identified parties and retain the unresolved questions

Once the relationship map is usable, screen the relevant names and retain the identifiers used. Keep the source and record reference with any result. If the same name is used by multiple companies, use the available registration and jurisdiction information in the human review instead of assuming the first result is the right entity.

Use the current UK Sanctions List for UK designation checks. The old OFSI Consolidated List stopped being updated when the single-list approach took effect on 28 January 2026.^[5]

Our suggested outcome categories are: review complete with rationale, further information needed, or escalated for a decision. An incomplete ownership chain belongs in the second or third category even if every name you happened to search returned no matches. Make that limitation explicit to anyone approving the service.

Worked example: a formation request through an overseas agent

Consider a fictional order for a UK company submitted by an overseas intermediary. The order names a proposed director and one corporate shareholder, but it does not identify the people behind that shareholder. The invoice is to be paid by a third business. None of those facts alone establishes sanctions exposure.

A useful response is to establish the roles and commercial explanation, obtain the ownership information needed for review, and document the relationship between the payer and the client. Search the identified relevant parties and record the results. If the client will not explain the structure, do not describe the file as cleared merely because the proposed director’s name produced no result.

Escalate uncertainty through the firm’s sanctions procedure, including assessment of reporting duties where relevant. The exact action depends on the facts and applicable restrictions. This example is an original workflow illustration, not a determination that every intermediary order needs identical checks or must be refused.

Keep continuing services connected to current information

A company formation may lead to registered-office, administrative or other continuing work. Our recommendation is to capture relevant changes to ownership, instruction rights and the service being provided, then route them back into review. Do not let a completed incorporation order become a permanent clearance for a different relationship.

Keep the formation record and subsequent review history linked. A reviewer should be able to distinguish the structure originally proposed from the structure later reported. If you rely on a document supplied months earlier, record when it was obtained and whether anything suggests it needs updating.

SanctionSearch supports published-list screening and evidence records. Its separate UK Companies House ownership/control review is an Enterprise feature; it does not automatically establish every ultimate owner or determine sanctions exposure. Keep specialist advice and any evidence from outside the platform within your own controlled client-file process.

• Record the parties, roles, source evidence and outstanding ownership questions.
• Document the human review of possible matches and any escalation decisions.
• Connect changes in continuing services to a fresh review where appropriate.
• Do not present Companies House registration, identity verification or a no-match result as interchangeable approvals.