CROSS-BORDER MERGERS – changes are coming

Directive 2019/2121 (Cross-border Mobility) became EU law on 31.01.2023 although Ireland has yet to transpose it into Irish law.

The Directive itself does not provide for transitional arrangements for Cross-Border Mergers commenced under the current Cross-border Merger Regulations (SI 157 of 2008) to complete under the current regime, following the 31.01.2023 transposition deadline.  

It is up to individual Member States to determine its own Regulations on how to manage the transition from 31.01.2023 to whenever those Regulations come into effect.

Ireland has proposed to provide two options for a company currently planning a Cross-Border Merger.

1. An Irish company currently planning to engage in a cross-border merger and seeking to rely on the current legislative regime can publish the common draft terms in advance of the new Regulations. The company will then have a six month period within which to hold its general meeting to approve draft terms and complete the transaction under the current regime. 

    

2. Companies may wait until the new Regulations are in place.

The Department of Enterprise, Trade and Employment is in the process of drafting the Regulations which will be introduced by way of Statutory Instrument.

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The Charities (Amendment) Bill 2022

The Charities (Amendment) Bill 2022 was published by The Minister for Rural and Community Development, Heather Humphries on 29 April 2022. The purpose of the Bill is “to provide for a number of amendments to the Charities Act 2009. The proposed amendments aim to improve the ability of the Charities Regulator to conduct its statutory functions, ensuring more proportionate regulation leading to greater public trust and confidence in the charities sector.” The Bill is expected to be enacted later this year.

Some of the provisions include the following;

• Establish the promotion of human rights as a charitable purpose.

• Increase the threshold for filing of a full set of Financial Statements from a maximum gross income or expenditure of €100,000 to €250,000 (aligning with the Companies Act 2014).

• The accounting standard “Charities Statement of Recommended Practices (SORP)” will be compulsory. An exemption will be permitted for charities with a turnover of less than €250,000.

• Definition of charities trustee to be amended to exclude Company Secretaries (who hold no other office in the charity).

• Introduction of new statutory fiduciary duties for trustees to act in good faith, avoid conflicts of interest and exercise an objective standard of care, skill and diligence when advancing the charitable purpose of the charity, mirroring similar duties of Directors under the Companies Act 2014.

• New Definition of the term “Member”. This change extends the requirement to maintain a Register of Members to unincorporated associations.

Click here for full text of the Charities (Amendment) Bill 2022

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