The Companies Act 2014

The Companies Act 2014 (the “Act”) introduced the provision that a Company Limited by Shares (“LTD”) could just have a single director.

In other words, a single Director company can be a private company limited by Shares. It allows for one Director but there must be a separate company Secretary.

Starting from the 1^st of June 2015, all new companies will have a choice of two different types of companies to setup:

Private Company Limited by Shares (Ltd.)

• It allows for one Director but it must have a separate Company Secretary. A Company Secretary can be any other person or registered entity here or abroad.
• It does not have a Memorandum of Association.
• It has no objects stated in its constitution. Therefore, it can be flexible in terms of the activity it engages in.
• A one document constitution replaces the Memorandum and Articles of Association.
• In the even of the company being wound up, the members’ liability is limited to the amount unpaid on the shares they hold, if any.
• An LTD is not required to have an Authorised Share Capital.
• The name of the company must end with the “Limited” or “Teoranta.
• An LTD cannot be an insurance undertaking or a credit institution.

Designated activity company (DAC):

• Is a private company limited by shares or by shares and guarantee.
• It must have at least two directors and a Company Secretary.
• At least one of the directors is required to be resident of a member state of the European Economic Area (EEA). According to Section 137 of the Company Act states, if you do not have a Director living in the European Economic Area, then you must purchase a bond, in the prescribed bond otherwise, you can apply to the CRO to be granted a certificate confirming that your company has a real and continuous economic link with Ireland.
• It has a two document constitution consisting of a memorandum and articles of association.
• It must have a main objects clause included in its constitution.
• It can pass majority written resolutions, where the constitution allows.
• It is required to hold an AGM where there are two or more members.
• The maximum number of members is 149.
• It is required to have an Authorised Share Capital.
• The name of the company must end with “Designated Activity Company” or “Cuideachta Ghníomhaíochta Ainmnithe” unless it is exempted.

Every Limited company in Ireland is required to have a Statutory registered office in the state.  The following Irish addresses are required:

1. The registered office address which is where CRO correspondence and formal legal notifications should be sent.
2. The address where the company’s activity is carried out.

The address where the central administration of the company is carried out can, however, be located outside Ireland.

Companies will only have to meet two of the following three criteria to qualify as a “small company” for the purposes of claiming an audit exemption.

1. A turnover that does not exceed €12 million
2. A balance sheet that does not exceed €6 million
3. An average number of employees that does not exceed 50

If a company qualifies for exemption, it must annex a copy of its abridged financial statements (approved by the directors) to the annual return.

Guarantee and Group companies will be able to qualify for the audit exemption.

Audit exemption for Irish companies can be lost if their annual return is filed late. This will result in the company losing its audit exemption for the next two years.

This article is for guidance purposes only. It does not constitute professional advice. No liability is accepted by Accounts Advice Centre for any action taken or not taken in reliance on the information set out in this article. Professional or legal advice should be obtained before taking or refraining from any action as a result of this article. Any and all information is subject to change.