by Sabrina Burke July-27-2015 in Employment Law
After years of much talk and expectation, the Companies Act 2014 (“the Act”) finally came into effect on 1 June 2015. Sabrina Burke identifies some key changes to Irish company law.
The new Act brings about significant changes in company law and specific advice should be sought on how the legislation affects you and your business. Here are some of the key things you need to know.
The Act provides for the creation of two new types of private limited companies:
- A company limited by shares (known as an “LTD”) — a new kind of company which offers greater flexibility in terms of its administration
- A designated activity company (known as a “DAC”) — these companies most closely resemble existing private limited companies.
All existing private limited companies with shares have a transition period of 18 months from 1 June 2015 to decide whether to convert to become an LTD or a DAC. If the company does nothing, at the end of the transition period it will automatically default to become an LTD. Although it is expected that most companies will choose to convert to become LTDs, it is important that you take advice on the type of company best suited to your organisation's activities.
Company name changes
The Act introduces name changes for certain types of companies. DACs, unlimited companies and companies limited by guarantee (the latter being the company form of choice for most charitable organisations) will be required to change the suffix attaching to their name by the end of the 18 month transition period — to “Designated Activity Company/ DAC”, "Unlimited Company/UC” or “Company Limited by Guarantee/ CLG”, as appropriate (unless they qualify for an exemption). This will mean making changes to the company stationery, website, name plates and ordering a new company seal for many companies.
In light of the various changes which the Companies Act 2014 introduces, it will be make sense for companies to review and restate their memorandum and articles of association to take account of the new legislation.
If you need specific advice on how the new Act affects you and your business, please contact the Hayes Commercial & Business team.
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About the Author
Sabrina Burke
Sabrina is a senior associate solicitor in the Commercial & Business team at Hayes solicitors. Sabrina's main area of work is mergers and acquisitions, where she acts for buyers and sellers across various industry sectors. She also advises on corporate reorganisations, shareholder agreements and other commercial arrangements and contracts including agency/franchise/distribution agreements.