As you may be aware the Companies Act 2014 (“the Act”) has been signed into Irish law and commenced on 01 June 2015. The Act will impact all existing Irish companies and your company will be required to take action, in order to remain with the new legislation.
HOW DOES THIS IMPACT ME AND MY COMPANY?
All existing private limited companies will have to decide whether to convert to a simplified Company Limited by Shares (“LTD”) or a Designated Activity Company (“DAC”). Please see the attached brochure for more information on these company types. The Directors of the company are in the main part, responsible for this.
WHEN DO I NEED TO TAKE ACTION?
There is a period of 18 months (from 01 June 2015) allowed to complete the conversion process. We would recommend that your conversion happens in conjunction with your next compliance season. This will reduce the administrative burden on you. However, you may wish to complete the conversion process at another earlier/later suitable time. For those companies opting for the DAC conversion, then there is a 15 month time frame to convert.
WHAT SHOULD I DO FIRST?
The Directors should consider the following practical aspects of converting to an LTD or a DAC:
- What are the future plans for the company;
- Review the existing Memorandum and Articles of Association (“M&A”); to determine if there are any restrictions that would determine your new company type.
- Contact our Corporate Compliance team, who will be happy to assist you, or provide you with a copy of your most up to date M&A
WHAT HAPPENS IF I DON’T CONVERT MY COMPANY?
During the transition period all existing Limited by Shares Companies will be treated as DAC’s. However, if at the end of the transition period, 30th November 2016, conversion has not been completed, the Registrar of Companies will enforce the change and convert the company to the new form LTD. A new certificate of incorporation will then be issued automatically.
Where no action has been taken the company may be deemed to have a corporate form and constitution that does not actually suit their requirements. Conflicts will exist between the deemed constitution and the existing M&A as lodged in the public record, making it practically unintelligible as a stand-alone document. Apart from being poor corporate governance this may impact the subject company’s dealings with its own shareholders, with banks, potential investors, Enterprise Boards and any other third parties. Directors may also be exposed where shareholders have been prejudiced by inaction.
DO I HAVE TO CHANGE MY COMPANY MERCHANDISE/WEBSITE/LOGO ETC. AFTER RE-REGISTRATION?
If you are re-registering your company as an LTD you will not have to make any changes as the suffix Limited or LTD will remain unchanged.
If you are re-registering as a DAC the name of the company will be altered by the addition of the suffix “Designated Activity Company” instead of “Limited”. The Directors must ensure that the new name is correctly reflected and should look at obtaining a new company seal, changing the name on stationery, websites, signage, amending share certificates and submitting amendments on property registers and registers of intellectual property.
HOW WILL THE TEAM AT UHY FDW COMPANY SECRETARIAL SERVICES LTD ASSIST ME?
Our team will be happy to guide you through the conversion process from start to finish and assist as follows:
- Speak with you and explain the process (if required)
- Review your M&A and provide you with a recommendation on a suitable company type
- Draft the complete suite of necessary documentation to complete your conversation
- File all applicable documents with the Companies Registration Office
- Notify you on the successful conversion and provide you with the new Certificate of Incorporation (as applicable)
Our experienced Corporate Compliance team, would be delighted to assist you with any concerns you may have and also provide you with the necessary guidance and assistance to complete the conversion process for your company.
Please contact Richard in our compliance team at email@example.com or on 042 933 9955, for further details.