PRIVATE COMPANY LIMITED BY SHARES

Directors

The private company limited by shares (hereinafter, “LTD”) must have, at all times, at least one natural person aged at least 18 years holding office as director. If the LTD proposes to have only one director, this director must ordinarily be resident in the European Economic Area. The European Economic Area consists of the 27 Member States of the European Union, plus Iceland, the Principality of Lichtenstein and the Kingdom of Norway. Note, while a member of the single market, the Swiss Confederation is not a European Economic Area State. Following its withdrawal from the European Union, the United Kingdom of Great Britain and Northern Ireland is not a European Economic Area State.

An LTD may obviate the requirement to have a European Economic Area-resident director in one of three ways. First, it may hold a bond to the value of €25,000.00. This bond, which has a currency of two years, provides for the payment of the whole or part of certain fines or penalties imposed on the LTD under the Companies Act, 2014 and the Taxes Consolidation Act, 1997. Second, it may, subject to qualifying conditions, apply for a certificate from the Registrar of Companies. This certificate states the LTD has a real and continuous link with at least one economic activity being carried on in the State. Third, if the LTD does not have a person resident in the European Economic Area consenting to hold office as director, it may retain a trust or company service provider authorised to provide director services in Ireland to appoint such a person.

Secretaries

The LTD must have, at all times, a person holding office as secretary. (Note, under this heading, a “person” includes a natural person aged at least 18 years, a body corporate and an unincorporated body of persons.) Where the LTD has two or more directors, any one of them may hold concurrent office as secretary. However, in the case of a single-director LTD, the secretary must be another person. While not required to do so, the LTD may, if it elects, additionally appoint persons to hold office as joint secretary, assistant secretaries and deputy secretaries. It is to be noted that the directors of an LTD have a statutory duty to ensure the secretary has the skills or the resources necessary to discharge his, her or its statutory and other duties.

Where an LTD does not have a person consenting to hold office as secretary, it may retain a trust or company service provider authorised to provide company secretary services in Ireland to appoint such a person.

Members

An LTD must have, at all times, at least one person being a subscriber to the constitution of the company. (Note, under this heading, a “person” includes a natural person, a body corporate and an unincorporated body of persons.) Being a public document, the constitution of the company and every alteration thereof will contain the name and particulars of every subscriber. Following incorporation, the subscriber is deemed to have become a member. An LTD is prohibited from having more than 149 members. In the absence of share qualifications, whether contained in the constitution of the company or otherwise, at least one share, of whatever class and nominal value, must be registered in a member’s name. The LTD must maintain a register containing the particulars of, and interests held by, each member.

An LTD may avail of a written resolution procedure, whereby the members may pass an ordinary resolution, a special resolution or a unanimous resolution in writing with the same effect as if it were passed at a general meeting of the company duly convened and held. An LTD may, subject to qualifying conditions and with the unanimous written resolutions of members, dispense with the requirement to hold an annual general meeting in any particular year.

The liability of the members of an LTD at any time is limited to the amount, if any, unpaid on the shares registered in each member’s name at that time.

Prior to incorporation, a person may retain a trust or company service provider authorised to provide nominee shareholding services in Ireland to appoint a nominee in place of the subscriber. Following incorporation, a person may retain a trust or company service provider authorised to arrange for, and act as, trustee services in Ireland to hold the subscribed shares in trust. In both cases, notice of a trust may not be entered in any register maintained by the LTD or the Registrar of Companies.

Registered Office

An LTD must have, at all times, a registered office situate within the State to which all communications and notices may be addressed. A company may not use a post office box as a registered office address. A registered office address may be a residential address and, in cases of leasehold property, the use of that address as a registered office must be permitted by the leasehold agreement concerning that property.

Where an LTD cannot provide for a registered office address, it may retain a trust or company service provider authorised to provide registered office services in Ireland to provide such an address.

Corporate Capacity

An LTD, whether acting within or without the State, enjoys full and unlimited capacity to carry on and undertake any business or activity, do any act or enter into any transaction and, for that purpose, enjoys full rights, powers and privileges. However, an LTD is prohibited from carrying on business as a credit institution or an insurance undertaking. In addition, certain business activities may require prior authorisation or licence prior to the carrying on business of such activity.

The consequences of incorporation is that the LTD has a legal personality separate and distinct from that of its officers and members. The separate legal personality of an LTD may only be disregarded in the most exceptional of circumstances.

An LTD may sue or be sued in its own name. The directors of a company are not permitted to act as litigants in se; that is, the directors may not represent the company in litigation and must retain solicitors and, if required, instruct counsel. Where the LTD is plaintiff in any action, the Court may require that the company provide security to be given to the defendant for costs, and may stay all proceedings until such security is given.

Company Capital

An LTD may, if it elects to do so, state an authorised share capital. Shares in the capital of an LTD must have a nominal value, and may be of one or more classes. An LTD may allot shares of different nominal values, of different currencies, with different amounts payable on them; or with a combination the foregoing characteristics.

The rights attaching to any class of shares may be stated in the constitution of the company. Alternatively, the rights may be contained in a shareholders’ agreement; such agreement not being a publicly available instrument.

Company Name

Certain restrictions on company names apply. The Registrar of Companies may refuse a company’s name if the name is identical to, or too similar to, a name already entered in the Register of Companies, or if it is offensive, or if it would tend to indicate State sponsorship. In addition, geographic and other place names are insufficient for distinguishing between company names; neither are punctuation marks nor extended Latin alphabet letters. Similarly, the inclusion of a year in a company name to distinguish between an existing company name is prohibited. In certain cases, prior permission must be sought by public authorities or professional bodies prior to the use of a company name. A company name may be changed at any time by special resolution.

The company name of an LTD must use the suffix “Limited” or, in the Irish language, “Teoranta”. This may be abbreviated to “Ltd.” or “Teo.”, respectively.

An LTD may carry on business with a trading name similar to, or separate from, its company name; provided such name has been first registered with the Registrar of Business Names. Similar restrictions on business names also apply.

Constitution

The constitution of an LTD contains four mandatory provisions; namely, the name of the company, the fact that it is an LTD, the extent of liability of its members and its company capital. There are 149 provisions of the Companies Act, 2014 which may be adopted, modified or rejected by an LTD and stated as such in its constitution.

Statutory Financial Statements

An LTD must file an annual return, containing certain particulars of the LTD, six months after its date of incorporation, and on that date in each subsequent year. This date, the annual return date, may, subject to qualifying conditions, be changed once every five years if the LTD elects to do so. The first annual return does not require statutory financial statements to be annexed thereto.

For each subsequent annual return, the LTD must annex statutory financial statements, which is a public document. Subject to certain qualifying conditions, an LTD may file abridged statutory financial statements and may avail of a statutory audit exemption.