Penalty for what? There is usually a pretty large distinction between misfiling as part of a crime, and misfiling as mere clerical error.
I don’t know where you operate.
Perhaps it’s so corrupt that officials will use any excuse to jail people who don’t pay them, but if this is the kind of locale in which you operate, a regulation like this would seem to be the least of your worries.
If doing something could allow the prosecutor to plausibly charge you with this, even if you wouldn't be convicted, you now have to be counseled in doing it to avoid that possibility, otherwise you could be coerced into pleading guilty to something you didn't do because the alternative is prohibitively expensive legal defense from a questionable charge with a low risk of a high penalty.
Businesses are risk averse with things like this, so now, because of the possible implications, they'll hire a lawyer/accountant to deal with it, increasing compliance costs on many innocent people.
My point is that if this is all they have then they don’t have a case, so legitimate businesses don’t need to stress about about clerical errors landing them in jail.
There is no if. Everybody is committing a crime all the time. There are laws that prohibit doing things that other laws mandate. There are more pages of laws on the books than anyone could read in a lifetime, so there is no feasible way to know that a given action isn't illegal.
Businesses are engaged in risk management. They try to avoid knowingly breaking the law. Making that process consume more resources, increases compliance costs.
It will also needlessly lead to the disclosure of personal information from people doing nothing wrong, simply because using tax disregarded LLCs has become a widespread practice to patch around just about everything else constantly demanding your personal info and leaking it everywhere.
By demanding the submission of this information, having harsh penalties for avoiding it, and providing apparently zero protection or consequences for disclosing it... that outcome is essentially guaranteed.
Is it? Can you give some examples of how this is used?
I have never seen any reporting on this practice. What makes you think it is widespread?
In the UK, they don't, because we don't have plea bargains.
Various UK sources seem to think you do, and cite specific government guidelines for the practice, e.g.:
https://www.inbrief.co.uk/court-proceedings/plea-bargaining/
> the penalty is prison time, and not a fine
You aren't going to prison for an honest mistake. mens rea, innit.
As some solicitors say [1]:
> It is a criminal offence not to:
> * Take reasonable steps to find out if there is anyone who is a PSC and identify them to Companies House
> * Give notice to the registrar of companies of an entry alteration or note in a company’s PSC register within 14 days of any change being made
> The sanctions for such offences are a fine or possible imprisonment.
> In the event that you do not comply with your PSC requirements Companies House will contact your business and give you an opportunity to rectify the position, before proceeding to enforcement action.
https://www.gl.law/insight/news/criminal-effects-psc-regulat...
It is not. It adds stress. When this was added (where I operate), I had to call in an accountant to do the paperwork because the penalty is prison time, and not a fine. This additional stress and paperwork just keeps compounding (there is a new paperwork every one or two years now). Then you have the small fee for that particular paperwork (should have been free?) and the accountant fee. It just keeps adding up, and for a single or very small business it's becoming unsustainable.