Maureen O’Sullivan Registrar Companies Registration office The Companies Act 2014 Maureen O’Sullivan Registrar Companies Registration office

Companies Act 2014 Modernise and simplify company law Reduce administrative burden on business Ensure good corporate governance

How will the new act affect you? The changes in the new Act will affect every company. All CRO forms will change from 1st June 2015. Old forms will no longer be accepted after this date. New forms should not be submitted prior to 1st June 2015. Most new forms now available on CRO website www.cro.ie.

Key Changes – Annual Returns Audit exemption Companies will only have to meet 2 of the 3 size criteria to quality as a small company for the purposes of claiming an audit exemption. Guarantee and Group companies will be able to qualify for the audit exemption. There will be a new audit exemption available to Dormant companies. Defective Financial Statements There will be a mechanism for companies to voluntarily correct defective financial statements where they have been submitted to the CRO.

Key changes - directors Age requirement Every director and secretary must be aged 18 or over. This applies to companies incorporated prior to commencement of the new Act. Any minor who is currently appointed as a director will cease to be a director on commencement. Any appointment where the company officer is a minor is void Section 150(11) allows for withholding of a director’s home address in certain circumstances.

Key changes – directors (2) Foreign disqualification Where any director (where already appointed to a company) is or becomes disqualified in a foreign jurisdiction then Form B74a must be submitted to the CRO. This should be done within 3 months of the commencement of the Act for existing company directors who are currently disqualified and did not submit Form B74 notice on appointment. Directors’ duties have now been codified and set out in Part 5 of the Companies Act 2014.

Some Duties of Directors Duty to act in good faith in what the director considers to be the interests of the company Duty to act honestly and responsibly in relation to the conduct of the affairs of the company Duty to act in accordance with the company’s constitution and to exercise his/her powers only for lawful purposes Duty not to use the company’s property, information or opportunities for his or her own benefit unless this is expressly permitted in the company’s constitution or has been approved by a resolution of the shareholders in a general meeting.

Company secretary Every company must have a company secretary. The secretary may be one of the directors unless there is only one director. The directors have a duty to ensure that the company secretary has the necessary skills or resources to carry out his or her statutory duties. The company secretary can be an individual or a body corporate. The duty of the company secretary is owed to the company.

Duties of the company Secretary Maintain the statutory register, minute books and headed paper. Organise meetings of directors and shareholders and record the minutes. Countersign: annual return, certificate stating that financial statements are a true copy, satisfaction or release form with respect to a charge. Ensure necessary forms are filed in CRO. Provide administrative support to the Board.

Key changes – voluntary strike off The procedure for voluntary strike will be formalised from the commencement of the Act. The procedure itself remains the same: The request for strike off must be completed by all the directors of the company and be accompanied by a letter of no objection from the Revenue Commissioners and the newspaper advertisement. Objections to strike off should be made on a Form H16 detailing which criteria for strike-off has not been met.

Conversions All private companies limited by shares MUST convert to either the LTD or DAC model. To do this they must pass a special resolution to amend the company’s M&A and submit together with the appropriate Form N1 (LTD) or Form N2 (DAC). These documents can be filed free of charge.

Transition PERiod A period of 18 months will be allowed for existing Limited companies to opt for conversion to either a LTD or DAC. Companies that do not convert will operate under the DAC legislation until the end of the Transition Period. If companies do not convert, they will be converted to LTD by the CRO at the end of the Transition Period. A new electronic certificate of incorporation will be issued by the CRO.

Requirement to change company name A company’s name must include the company type suffix at the end of its name unless exempted. All Guarantee and all Unlimited companies will therefore have to change their name to include their company type at the end of their name. There will be an 18 month period during which Form N3 can be filed free of charge for companies obliged to change their names. Where a company does not change its name during the Transition Period the CRO will apply the name change at the end of the period.

Other changes End of administrative waiver scheme Registered Persons The CRO administrative waiver scheme in respect of late filing penalties will terminate once the Act is commenced. Companies may apply to their local District Court to extend their annual return filing period. If the Court considers an extension justified, the company will avoid late filing penalties and loss of audit exemption where applicable. Registered Persons Registered Office Agent

Further information www.cro.ie New Act 2014 tab for information on the Companies Act 2014. Under Publications tab click on Information Leaflets for detailed information on filing requirements etc. Directors Flyer recently posted to all directors on the register. E zine – subscribe at www.cro.ie/publications/newsletter