Cost Recovery Principles

Companies House is a Trading Fund and must operate on the basis of cost recovery. Companies House fees are linked, as required by European Law and HM Treasury guidance, to the forecast cost of providing each service and the way in which customers access them.

The principal fees rules and statute that Companies House follows are:

• As a Trading Fund, Companies House has a statutory duty to break even over time and to achieve an average annual return (surplus) of 3.5%.
• Managing Public Money which is HM Treasury guidance on fees and charges requires fees to be set to recover the full cost for each separate service after allowing for a cost of capital of 3.5%. This prohibits cross-subsidy between different statutory services.
• The EC First Company Law Directive, requires copies of company records to be made available to the public at a price not exceeding the "administrative cost" of producing them.
• The EC Capital Taxes Directive allows company registration costs to be met from fees, but prohibits charges that are effectively taxes. This means that prices cannot lawfully be set above costs for the relevant services.
• Case law (notably Fantask A/S e.a. v Industriministeriet (Erhvervministeriet and Ponente Carni SpA and Cispandana Costruzioni SpA v Amministrazione delle Finanze dello Stato) provides further guidance on the costs that can, and cannot, be taken into account for fee-setting.
• The Competition Act 1998 prohibits the abuse of a dominant position in a market.