On 1 June 2015, Ireland’s new Companies Act 2014 (Act) will come into effect. The Act repeals and consolidates a total of 32 existing enactments relating to Irish company law into a single statute. It represents the largest piece of legislation ever enacted in Ireland and heralds significant reforms for new and existing companies.
One of the key consequences of the Act is the requirement for all existing Irish private companies limited by shares to alter their legal form. From 1 June 2015, companies must choose to convert to one of the following types of company:
- A new company limited by shares (LTD);
- A designated activity company (DAC); or
- Some other company type (e.g. an unlimited company or a public limited company).
Existing private limited companies will not be permitted to continue in their current form, and must convert to one of the above. These companies will also be required to register a new constitution in place of their existing memorandum and articles of association. Once the Act becomes effective, these companies will have 18 months to decide their new status and adopt a new form of constitution in compliance with the requirements of the new Act. After this transition period has passed on 1 December 2016, any companies remaining in their original form will be automatically converted to an LTD.
Affected companies should convert their status as soon as possible following the commencement date of 1 June 2015 to avoid any problems dealing with third parties.
Faegre Baker Daniels does not advise on Irish law; however, through our network of law firms in Ireland, we can connect you with a firm to assist in making sure you are compliant with this new piece of legislation.