The Companies Bill was signed into law by President Higgins on December 23rd, and is now the Companies Act 2014. The Companies Act 2014 will be commenced on 1st June 2015. There will be a transiti

The Companies Bill was signed into law by President Higgins on December 23^rd, and is now the Companies Act 2014.  

The Companies Act 2014 will be commenced on 1^st June 2015.  There will be a transition period of 18 months and existing companies will need to consider conversion within this period.

We will be in touch with all our existing clients directly over the coming months, advising and supporting them in relation to changes and in particular with regard to conversion.

If you have any specific queries, please don’t hesitate to call us, we are delighted to help.  We understand that it’s important for you to understand your options so you make the correct decisions.

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One of the main reforms the Bill is introducing, is a new form of company, the private company limited by shares (CLS) which will be new the model company.

One of the main reforms the Bill is introducing, is a new form of company, the private company limited by shares (CLS) which will be new the model company.

New Model Company – CLS

The CLS is the new type private company limited by shares which benefits from most of the reforms introduced under the bill. It will have a one-document constitution, facility to have a single director and the ability to dispense with physical AGMs. It can also pass majority resolutions, claim eligibility for audit exemption and have up-to 149 members.

Given most existing companies are private companies limited by shares, these companies must consider whether to convert to a CLS or a DAC. It is expected that most companies will choose to convert to the new CLS private company limited by shares.

Designated Activity Company - DAC

The DAC is similar in form to the current private company limited by shares, and not all of the reforms will apply to the DAC. Unlike the CLS, a DACs activities are limited by its object clause. It must have a minimum of two directors (one of which can be the Company Secretary). The DAC cannot dispense with the need to hold a physical AGM. Like the CLS, it can pass majority resolutions, claim eligibility audit exemption and have up-to 149 members.

Examples of DACS

• Companies required to limit business activities to a defined capacity e.g. SPVs
• Joint Ventures - shareholders want to define corporate capacity
• Private companies regulated by the Central Bank of Ireland i.e. UCITS
• AIFMs,
• insurance companies
• Companies limited by guarantee with a share capital

A further consideration is that the DAC must change its company name i.e. Bayatelle Funding Ltd would become Bayatelle Funding DAC

CONVERSION

There will be an 18 month transition period and companies should formally resolve to convert within 15 months. During the transition period, all existing private companies limited by shares must convert to either a CLS (Private company limited by shares),or a DAC (Designated activity Company), their options are as follows:

• Convert to new CLS using model constitution
• Convert to new CLS using adapted existing M&A, which will now be a constitution
• Register as a Designated activity Company (DAC) –where members want this
• Register as a DAC because you are required to e.g. listing debt securities, credit institution

This applies to private companies limited by shares formed before the new Act. During the transition period existing private companies are deemed to be DACs until they convert and won’t benefit from any of the new reforms available to the CLS.

Companies who do nothing will be deemed by law to be a CLS. The Companies Registration Office will intervene; and the company will have a constitution comprising the contents of its current memorandum (without objects & articles). Eligible members or creditor who deem their rights to have been prejudiced by the inaction of company or directors in terms of conversion options, will be able to apply to court for relief.

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Welcome to our first blog entry on the Companies Bill 2012! We hope you join us and enjoy as we add useful content about the practical impacts of this ground breaking piece of Company Law

Welcome to our first blog entry on the Companies Bill 2012!

We hope you join us and enjoy as we add useful content about the practical impacts of this ground breaking piece of Company Law legislation on Irish businesses.

This blog sets the stage and gives you a brief background for the basis of the change and also explains how the actual Bill is structured.

The Companies Bill 2012

Enactment of The Companies Bill 2012 is expected during November 2014 and commencement June 2015.

The Bill replaces the current Companies Acts 1963 – 2013, merges them into one piece of legislation and also includes some welcome additional reforms.

 The CLRG Report back in 2001 stated that the “The private company limited by shares….should be the primary focus of simplification” and has set out to produce a “state of the art company law code”.

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Charities Act 2009 Legislation in Ireland can be a little like waiting for a bus, it all arrives at the same time. The long awaited Charities Act 2009 is finally starting to become live.

Charities Act 2009

Legislation in Ireland can be a little like waiting for a bus, it all arrives at the same time. The long awaited Charities Act 2009 is finally starting to become live. The Act is intended to ensure transparency and accountability for all Charities. The intentions are good but, success will only be achieved if all involved in the regulation and operations of Charities can regain the trust of the donating public.

The extensive downturn in Christmas 2013 donations of between 20% - 41% experienced by extremely well known and long established charities highlights the importance of ensuring trust is re-established with the public as a matter of urgency. Scandals of the past have and will continue to have an impact on individuals supported by the various Charities in Ireland until the public genuinely believes the commencement of the Act has real and quantifiable benefits for public donations, and recipients of the extraordinary work carried out by so many unsung heroes in the charitable world.

Úna Ní Dhubhghaill was appointed the first Chief Executive of the Charities Regulatory Authority (CRA) on 1^st March, 2014. Personally accountable to the Chief Executive of the Public Accounts Committee she will also be responsible for managing and controlling administration of the CRA.

On 1^st May the Minister for Justice announced the appointment of Conor Woods as Chairperson of the CRA along with 15 other members of the CRA.

Charities, their Directors and their Officers will have to get a handle on the new terminology and reporting mechanisms contained within the Act. They will also have to recognise that personal accountability and public access to information is here to stay, and if anything, will be enhanced in the future. To help get started below is a brief outline of some of the new terms and activities contained within the Act.

Activity Report – all Charities regardless of any documents they may file in the Companies Registration Office will have to submit an Activity Report to the Charity Regulatory Authority. It is likely that including the Activity Report as a note within the Annual Accounts will suffice.

Benefit to the Community – referred to under Charitable Purpose [see below] this phrase covers the advancement of community welfare, environmental sustainability, arts, sciences, protection of natural environment, and integration of disadvantaged.

Charity Regulatory Authority – the CRA is not an individual, and is commonly referred to as either the Authority or Charities Regulator. The Authority will be responsible for maintaining a Register of Charities. The CRA will also have a role in helping Charities comply with legislation, and to investigate those Charities that do not comply.

Constitution – refers to existing Memorandum & Articles of Association of a Charity.

Charitable Purpose – for the first time a Charity must, by law, define its charitable purpose which should fall within the prevention or relief of poverty or economic hardship, advancement of education, religion or any other purpose of benefit to the community.

Charity Appeals Tribunal – the Tribunal is intended to deal with appeal processes against decisions of the Charity Regulatory Authority such as refusal of charitable status.   It will consist of 5 Members appointed by the Minister. All Tribunal proceedings will be conducted in public.

Charity Trustee – refers to Directors or other officers of the Charity.

Chief Executive – as mentioned above Úna Ní Dhubhghaill is the first Chief Executive of the CRA. Personally accountable to the Chief Executive of the Public Accounts Committee she will also be responsible for managing and controlling administration of the Charity Regulatory Authority.  Establishment Day – the precise date will be determined by the Minister for Justice and is intended to provide a clear and definitive date showing the crossover from existing legislation to the commencement of the Charities Regulatory Authority. The existing role of the Commissioner for Charitable Donations will cease and transfer to the Charities Regulatory Authority on Establishment Day.

Registered Charitable Organisation – is defined as a charitable organisation either registered or deemed to be on the Register.

Register of Charitable Organisations – Charities that existed prior to the commencement of this Act will be deemed to be on the Register. Such charities would before the commencement of the Act have been entitled to tax exemption and have a CHY number. The Register will contain details on where the Charity is registered (in the State, EEA or elsewhere), names of Charity and its Charity Trustees.

The annual registration fee for being on the Register will be based on the gross annual income of a Charity and is likely to range from €10 - €500. An online Register is expected to be in place by middle 2014. Una Ni Dhuhhaill has indicated her intention to contact Charities with an existing CHY number in the Autumn.

There are substantial resources available to Charities as they endeavour to come to terms with the Charities Act and anyone involved in the Charity sector should avail of those resources now. This bus is leaving the Terminal, don’t get left behind!

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Board of new Charities Regulatory Authority

Board of new Charities Regulatory Authority has been appointed by Minister Shatter. It's great to see this progressing.

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Change of Company Name Checklist

In our last blog we looked at the guidelines around choosing a company name.  Today, we give you a useful checklist for reference once you have changed your company name.

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4 Key Essentials to Changing your Company Name

4 Key Essentials to Changing your Company Name

1. How to change your Company Name?

2. Can I choose any name I like?

3. Guidelines for choosing a name

4. Finally, a word of caution

Find out more about the 4 Steps .....

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