Companies Act 2014

• (4) Subsection (1) does not apply to the profits or losses attributable to shares in a subsidiary held by a holding company where those shares were acquired in a transaction to which section 72, 73 or 75 applies.

119. Distributions in kind: determination of amount

119. (1) This section applies for determining the amount of a distribution consisting of or including, or treated as arising in consequence of, the sale, transfer or other disposition by a company of a non-cash asset where—

• (a) at the time of the distribution the company has profits available for distribution; and

• (b) if the amount of the distribution were to be determined in accordance with this section, the company could make the distribution without contravening this Part.

• (2) The amount of the distribution (or the relevant part of it) is taken to be—

• (a) in a case where the amount or value of the consideration for the disposition is not less than the book value of the asset, zero;

• (b) in any other case, the amount by which the book value of the asset exceeds the amount or value of any consideration for the disposition.

• (3) For the purposes of subsection (1)(a), the company’s profits available for distribution are treated as increased by the amount (if any) by which the amount or value of any consideration for the disposition exceeds the book value of the asset.

• (4) In this section “book value”, in relation to an asset, means—

• (a) the amount at which the asset is stated in the relevant financial statements referred to in section 121; or

• (b) where the asset is not stated in those financial statements at any amount, zero.

• (5) The provisions of section 121 shall have effect subject to this section.

120. Development costs shown as asset of company to be set off against company’s distribution profits

120. (1) Subject to the following provisions of this section, where development costs are shown as an asset in a company’s financial statements, any amount shown in respect of those costs shall be treated for the purposes of section 117 as a realised loss.

• (2) Subsection (1) shall not apply to any part of the amount referred to in that subsection representing an unrealised profit made on revaluation of the costs so referred to.

• (3) Subsection (1) shall not apply if—

• (a) there are special circumstances justifying the directors of the company concerned in deciding that the amount mentioned in respect of development costs in the company’s financial statements shall not be treated as required by that subsection; and

• (b) it is stated—

• F54[(i) where the company does not qualify for the micro companies regime and prepares Companies Act entity financial statements, in the note to the statements required by paragraph 24(2) of Schedule 3, or paragraph 24(2) of Schedule 3A, as the case may be; or,]

• (ii) where the company prepares IFRS entity financial statements, in any note to those statements,

that that amount is not to be so treated, and the note explains the circumstances relied upon to justify the decision of the directors to that effect.

121. The relevant financial statements

121. (1) Subject to the following provisions of this section, the question whether a distribution may be made by a company without contravening section 117 and the amount of any distribution which may be so made shall be determined by reference to the relevant items as stated in the relevant entity financial statements, and section 117 shall be treated as contravened in the case of a distribution unless the requirements of this section in relation to those statements are complied with in the case of that distribution.

• (2) The relevant entity financial statements for any company in the case of any particular distribution are—

• (a) except in a case falling within paragraph (b) or (c), the last entity financial statements, that is to say, the statutory financial statements, respecting the company alone, prepared in accordance with the requirements of Part 6 (and, where applicable, in accordance with the requirements of Article 4 of the IAS Regulation (within the meaning of that Part)) which were laid in respect of the last preceding financial year in respect of which statutory financial statements so prepared were laid;

• (b) if that distribution would be found to contravene section 117 if reference were made only to the last statutory financial statements, such financial statements (“interim financial statements”), respecting the company alone, as are necessary to enable a reasonable judgement to be made as to the amounts of any of the relevant items;

• (c) if that distribution is proposed to be declared during the company’s first financial year or before any statutory financial statements are laid in respect of that financial year, such financial statements (“initial financial statements”), respecting the company alone, as are necessary as mentioned in paragraph (b).

• (3) The following requirements apply where the last financial statements of a company constitute the only relevant entity financial statements in the case of any distribution, that is to say—

• (a) those financial statements shall have been properly prepared or have been so prepared subject only to matters which are not material for the purpose of determining, by reference to the relevant items as stated in those statements, whether that distribution would be in contravention of section 117;

• (b) unless the company is entitled to and has availed itself of the audit exemption under section 360 or 365, the statutory auditors of the company shall have made a report under section 391 in respect of those financial statements;

• (c) if, by virtue of anything referred to in that report, the report is not an unqualified report, the statutory auditors shall also have stated in writing (either at the time the report was made or subsequently) whether, in their opinion, that thing is material for the purpose of determining, by reference to the relevant items as stated in those financial statements, whether that distribution would be in contravention of section 117; and

• (d) a copy of any such statement shall have been laid before the company in general meeting.

• (4) A statement under subsection (3)(c) suffices for the purposes of a particular distribution, not only if it relates to a distribution which has been proposed, but also if it relates to distributions of any description which include that particular distribution, notwithstanding that at the time of the statement it has not been proposed.

• (5) For the purpose of determining by reference to particular financial statements whether a proposed distribution may be made by a company, this section shall have effect, in any case where one or more distributions have already been made in pursuance of determinations made by reference to those same financial statements, as if the amount of the proposed distribution was increased by the amount of the distributions so made.

• (6) Where subsection (3)(a) applies to the relevant entity financial statements, section 117(5) shall not apply for the purposes of determining whether any revaluation of the company’s fixed assets affecting the amount of the relevant items as stated in those statements has taken place, unless it is stated in a note to those statements—

• (a) that the directors have considered the value at any time of any fixed assets of the company without actually revaluing those assets;

• (b) that they are satisfied that the aggregate value of those assets at the time in question is or was not less than the aggregate amount at which they are or were for the time being stated in the company’s statutory financial statements; and

• (c) that the relevant items affected are accordingly stated in the relevant financial statements on the basis that a revaluation of the company’s fixed assets that, by virtue of section 117(5), is deemed to have included a revaluation of the assets in question, took place at that time.

• (7) In this section—

“properly prepared” means, in relation to any financial statements of a company, that they have been properly prepared in accordance with the provisions of Part 6;

“relevant item” means any of the following, that is to say profits, losses, assets, liabilities, provisions (within the meaning of F55[Schedule 3, 3A or 3B, as the case may be]), share capital and reserves;

“reserves” includes undistributable reserves, that is to say—

• (a) the company’s undenominated capital;

• (b) the amount by which the company’s accumulated, unrealised profits, so far as not previously utilised by any capitalisation, exceed its accumulated, unrealised losses, so far as not previously written off in a reduction or reorganisation of capital duly made; and

• (c) any other reserve which the company is prohibited from distributing by any enactment, other than one contained in this Part, or by its constitution.

“unqualified report”, in relation to any financial statements of a company, means a report without qualification, to the effect that, in the opinion of the person making the report, the financial statements have been properly prepared, and for the purposes of this section, financial statements are laid if section 290 has been complied with in relation to those statements.

122. Consequences of making unlawful distribution

122. (1) Where a distribution or part of one, made by a company to one of its members, is made in contravention of any provision of this Part and, at the time of the distribution, he or she knows or has reasonable grounds for believing that it is so made, he or she shall be liable to repay it or that part, as the case may be, to the company or (in the case of a distribution made otherwise than in cash) to pay the company a sum equal to the value of the distribution or part at that time.

• (2) This section is without prejudice to any obligation imposed apart from this section on a member of a company to repay a distribution unlawfully made to him or her.

123. Meaning of “distribution”, “capitalisation”, etc., and supplemental provisions

123. (1) In this Part “distribution” means every description of distribution of a company’s assets to members of the company, whether in cash or otherwise, except distributions made by way of—

• (a) an issue of shares as fully or partly paid bonus shares;

• (b) the redemption of preference shares pursuant to section 108 out of the proceeds of a fresh issue of shares made for the purposes of redemption;

• (c) the redemption or purchase of shares pursuant to section 105 and the other relevant provisions of this Part out of the proceeds of a fresh issue of shares made for the purposes of the redemption or purchase;

• (d) the payment pursuant to section 106(5) of any premium out of the company’s undenominated capital on a redemption referred to in that provision; F56[…]

• (e) a distribution of assets to members of the company on its winding F57[up; and]

• F58[(f) the reduction of share capital—

• (i) by paying off paid up share capital (effected in accordance with section 84 in the case of a company limited by shares), or

• (ii) by extinguishing or reducing all or part of a member’s liability on shares not fully paid up (effected in accordance with section 84 in the case of a company limited by shares).]

• (2) In this Part “capitalisation”, in relation to any profits of a company, means any of the following operations, that is to say, applying the profits in wholly or partly paying up unissued shares in the company to be allotted to members of the company as fully or partly paid bonus shares or transferring the profits to undenominated capital.

• (3) In this Part references to profits and losses of any description are references respectively to profits and losses of that description made at any time and, except where the context otherwise requires, are references respectively to revenue and capital profits and revenue and capital losses.

• (4) The provisions of this Part are without prejudice to any enactment or rule of law or any provision of a company’s constitution restricting the sums out of which, or the cases in which, a distribution may be made.

• (5) Where a company makes a distribution of or including a non-cash asset and any part of the amount at which that asset is stated in the financial statements relevant for the purposes of the distribution in accordance with this Chapter represents an unrealised profit, that profit is to be treated as a realised profit—

• (a) for the purpose of determining the lawfulness of the distribution in accordance with this Chapter (whether before or after the distribution takes place); and

• (b) for the purpose of the application of F59[paragraph 14(a) of Schedule 3, 3A or 3B and paragraph 37(3) of Schedule 3 or 3A, as the case may be] (only realised profits to be included in or transferred to the profit and loss account) in relation to anything done with a view to or in connection with the making of that distribution.

124. Procedures for declarations, payments, etc., of dividends and other things

124. (1) Each provision of this section and section 125 applies save to the extent that the company’s constitution provides otherwise.

• (2) A company may, by ordinary resolution, declare dividends but no dividend shall exceed the amount recommended by the directors of the company.

• (3) The directors of a company may from time to time—

• (a) pay to the members such interim dividends as appear to the directors to be justified by the profits of the company, subject to section 117;

• (b) before recommending any dividend, set aside out of the profits of the company such sums as they think proper as a reserve or reserves which shall, at the discretion of the directors, be applicable for any purpose to which the profits of the company may be properly applied, and pending such application may, at the like discretion either be employed in the business of the company or be invested in such investments as the directors may lawfully determine;

• (c) without placing the profits of the company to reserve, carry forward any profits which they may think prudent not to distribute.

• (4) Subject to the rights of persons, if any, entitled to shares with special rights as to dividend, all dividends shall be declared and paid according to the amounts paid or credited as paid on the shares in respect of which the dividend is paid.

• (5) However no amount paid or credited as paid on a share in advance of calls shall be treated for the purposes of this section as paid on the share.

• (6) All dividends shall be apportioned and paid proportionally to the amounts paid or credited as paid on the shares during any portion or portions of the period in respect of which the dividend is paid, but if any share is issued on terms providing that it shall rank for a dividend as from a particular date, such share shall rank for dividend accordingly.

• (7) The directors may deduct from any dividend payable to any member, all sums of money (if any) immediately payable by him or her to the company on account of calls or otherwise in relation to the shares of the company.

125. Supplemental provisions in relation to section 124

125. (1) A general meeting of a company declaring a dividend or bonus may direct payment of such dividend or bonus wholly or partly by the distribution of specific assets and, in particular, paid up shares, debentures or debenture stock of any other company or in any one or more of such ways.

• (2) The directors of the company shall give effect to such resolution, and where any difficulty arises in regard to such distribution, the directors may settle the matter as they think expedient and, in particular, may—

• (a) issue fractional certificates and fix the value for distribution of such specific assets or any part of them;

• (b) determine that cash payments shall be made to any members upon the footing of the value so fixed, in order to adjust the rights of all the parties; and

• (c) vest any such specific assets in trustees as may seem expedient to the directors.

• (3) Any dividend, interest or other moneys payable in cash in respect of any shares may be paid—

• (a) by cheque or negotiable instrument sent by post directed to or otherwise delivered to the registered address of the holder, or where there are joint holders, to the registered address of that one of the joint holders who is first named on the register or to such person and to such address as the holder or the joint holders may in writing direct; or

• (b) by agreement with the payee (which may either be a general agreement or one confined to specific payments), by direct transfer to a bank account nominated by the payee.

• (4) Any such cheque or negotiable instrument shall be made payable to the order of the person to whom it is sent.

• (5) Any one of two or more joint holders may give valid receipts for any dividends, bonuses or other moneys payable in respect of the shares held by them as joint holders, whether paid by cheque or negotiable instrument or direct transfer.

• (6) No dividend shall bear interest against the company.

126. Bonus issues

126. (1) Each provision of this section applies save where the company’s constitution provides otherwise.

• (2) In subsections (3) and (4) “relevant sum” means—

• (a) any sum for the time being standing to the credit of the company’s undenominated capital;

• (b) any of the company’s profits available for distribution; or

• (c) any sum representing unrealised revaluation reserves.

• (3) The company in general meeting may, on the recommendation of the directors, resolve that any relevant sum be capitalised and applied on behalf of the members who would have been entitled to receive that sum if it had been distributed by way of dividend and in the same proportions in or towards paying up in full unissued shares of the company of a nominal value equal to the relevant sum capitalised (such shares to be allotted and distributed credited as fully paid up to and amongst such holders and in the proportions as aforementioned).

• (4) The company in general meeting may, on the recommendation of the directors, resolve that it is desirable to capitalise any part of a relevant sum which is not available for distribution, by applying such sum in paying up in full unissued shares to be allotted as fully paid bonus shares, to those members of the company who would have been entitled to that sum if it were distributed by way of dividend (and in the same proportions).

• (5) The directors of the company shall give effect to any resolution under subsection (3) or (4).

• (6) For that purpose the directors shall make—

• (a) all appropriations and applications of the undivided profits resolved to be capitalised by the resolution; and

• (b) all allotments and issues of fully paid shares, if any, and generally shall do all acts and things required to give effect to the resolution.

• (7) Without limiting the foregoing, the directors may—

• (a) make such provision as they think fit for the case of shares becoming distributable in fractions (and, again, without limiting the foregoing, may sell the shares represented by such fractions and distribute the net proceeds of such sale amongst the members otherwise entitled to such fractions in due proportions); and

• (b) authorise any person to enter, on behalf of all the members concerned, into an agreement with the company providing for the allotment to them, respectively credited as fully paid up, of any further shares to which they may become entitled on the capitalisation concerned or, as the case may require, for the payment by the application thereto of their respective proportions of the profits resolved to be capitalised of the amounts remaining unpaid on their existing shares.

• (8) Any agreement made under such authority shall be effective and binding on all the members concerned.

• (9) Where the directors of a company have resolved to approve a bona fide revaluation of all the fixed assets of the company, the net capital surplus in excess of the previous book value of the assets arising from such revaluation may be—

• (a) credited by the directors to undenominated capital, other than the share premium account; or

• (b) used in paying up unissued shares of the company to be issued to members as fully paid bonus shares.

PART 4 CORPORATE GOVERNANCE

CHAPTER 1 Preliminary

127. Access to documents during business hours

127. (1) A reference in this Part to a document kept by a company being open to the inspection of a person, or a specified class of person, during business hours shall be read as a requirement that the document be open to such inspection subject to such reasonable restrictions as the company may in general meeting impose, but so that not less than 2 hours in each day be allowed for such inspection.

• (2) Subsection (1) applies to the provisions of other Parts of this Act that are referred to in Chapter 10 (which deals with, amongst other things, inspection of registers) as it applies to the provisions of this Part so referred to.

CHAPTER 2 Directors and secretaries

128. Directors

128. (1) A company shall have at least one director.

• (2) If default is made by a company in complying with subsection (1) for 28 consecutive days, the company and any officer of it who is in default shall be guilty of a category 3 offence.

129. Secretaries

129. (1) A company shall have a secretary, who may be one of the directors.

• (2) Anything required or authorised to be done by or to the secretary may, if the office is vacant or there is for any other reason no secretary capable of acting, be done by or to any assistant or deputy secretary or, if there is no assistant or deputy secretary capable of acting, by or to any officer of the company authorised generally or specially in that behalf by the directors.

• (3) Subject to section 25(5), the secretary shall be appointed by the directors of the company for such term, at such remuneration and upon such conditions as they may think fit; and any secretary so appointed may be removed by them.

• (4) The directors of a company shall have a duty to ensure that the person appointed as secretary has the skills or resources necessary to discharge his or her statutory and other duties.

• (5) The cases to which subsection (4) applies includes the case of an appointment of one of the directors of the company as secretary.

• (6) Where a company has only one director, that person may not also hold the office of secretary of the company.

• (7) In subsections (2) to (6) references to a secretary include references to joint secretaries.

130. Prohibition of body corporate or unincorporated body of persons being director

130. (1) A company shall not have as director of the company a body corporate or an unincorporated body of persons.

• (2) Any purported appointment of a body corporate or an unincorporated body of persons as a director of a company shall be void.

131. Prohibition of minor being director or secretary

131. (1) No person shall be appointed a director or, in the case of an individual, secretary of a company unless he or she has attained the age of 18 years.

• (2) Any purported appointment of a minor as a director F60[or secretary] of a company shall be void.

• (3) Where—

• (a) a person appointed a director of a company before the commencement of subsection (1) has not attained the age of 18 years when that subsection is commenced; or

• (b) the office of director of a company is held otherwise by virtue of another office, and the person appointed to that other office has not attained the age of 18 years when subsection (1) is commenced,

that person ceases to be a director of the company on the commencement of subsection (1) and the company shall make the necessary consequential alteration in its register of directors and shall notify the Registrar of the change.

132. Prohibition of undischarged bankrupt being director or secretary or otherwise involved in company

132. (1) F61[Subject to subsection (1A), if] any person being an undischarged bankrupt—

• (a) acts as a director or secretary of a company; or

• (b) directly or indirectly takes part or is concerned in the promotion, formation or management of a company,

the person shall (unless he or she does so with the leave of the court) be guilty of a category 2 offence.

• F61[(1A) The court shall not grant leave referred to in subsection (1) unless the Authority is given at least 14 days’ notice of the making of the application for leave, and the Authority shall be entitled to appear and be heard at the hearing of such an application.]

• (2) Where a person is convicted of an offence under subsection (1) the person shall be deemed to be subject to a disqualification order from the date of such conviction for such period as the court specifies if he or she was not, or was not deemed to be, subject to such an order on that date.

• (3) In this section “disqualification order” has the same meaning as it has in Chapter 4 of Part 14.

133. Examination as to solvency status

133. (1) Where the F63[Authority has reason to believe that a director or secretary of a company is an undischarged bankrupt, the Authority] may exercise the following power.

• (2) That power is to require the director or secretary of the company to produce to the F63[Authority], by a specified date, a sworn statement by him or her of all relevant facts pertaining to the director's or secretary’s financial position, both within the State and elsewhere, and, in particular, to any matter relating to bankruptcy as at a particular date.

• (3) The court may, on the application of the F63[Authority], require a director or secretary of a company who has made a statement under subsection (2) to appear before it and answer on oath any question pertaining to the content of the statement.

• (4) The court may, on the application of the F63[Authority], make a disqualification order against a director or secretary of a company, to be for such period as the court specifies, on the grounds that he or she is an undischarged bankrupt.

• (5) A director or secretary of a company who fails to comply with a requirement under subsection (2) shall be guilty of a category 3 offence.

• (6) In this section “disqualification order” has the same meaning as it has in Chapter 4 of Part 14.

134. Performance of acts by person in dual capacity as director and secretary not permitted

134. A provision of—

• (a) this Act;

• (b) an instrument under it; or

• (c) a company’s constitution,

requiring or authorising a thing to be done by or to a director and the secretary shall not be satisfied by its being done by or to the same person acting both as director and as, or in place of, the secretary.

135. Validity of acts of director or secretary

135. The acts of a director or of a secretary shall be valid notwithstanding any defect which may afterwards be discovered in his or her appointment or qualification.

136. Share qualifications of directors

136. (1) This section applies where the constitution of a company requires a director of the company to hold a specified share qualification (the “specified qualification”).

• (2) Where this section applies—

• (a) the office of director of a company shall be vacated if the director—

• (i) does not within 2 months after the date of his or her appointment or within such shorter time as may be fixed by the constitution, obtain the specified qualification; or

• (ii) ceases at any time, after the expiration of that period or shorter time so fixed, as the case may be, to hold the specified qualification;

and

• (b) a person vacating office under this section shall be incapable of being re-appointed director of the company until he or she has obtained the specified qualification.

137. Company to have director resident in an EEA state

137. (1) Subject to subsection (2) and section 140, one, at least, of the directors for the time being of a company shall be a person who is resident in an EEA state.

• (2) Subsection (1) shall not apply in relation to a company if the company for the time being holds a bond, in the prescribed form, in force to the value of €25,000 and which provides that, in the event of a failure by the company to pay the whole or part of each (if any) fine and penalty specified in the Table to this section, there shall become payable under the bond to a person who is, under subsection (4), nominated for the purpose (the “nominated person”) a sum of money for the following purpose.

• (3) That purpose is the purpose of the sum being applied by the nominated person in discharging the whole or part, as the case may be, of the company's liability in respect of any such fine or penalty (and any sum that becomes so payable shall be applied by the nominated person accordingly).

• (4) The nomination referred to in subsection (2) shall be made—

• (a) by the Registrar or the Revenue Commissioners, as appropriate; or

• (b) in the case of failure to pay both a fine referred to in paragraph 1 of the Table to this section and a fine or penalty, or a fine and penalty, referred to in paragraph 2 of that Table, jointly by the Registrar and the Revenue Commissioners.

• (5) The bond referred to in subsection (2) may be entered into and shall have effect according to its terms notwithstanding any rule of law whereby any agreement to insure or indemnify a person in respect of any punishment or liability imposed on him or her in relation to any offence or unlawful act committed by him or her is void or unenforceable.

• (6) If subsection (1) is not complied with, the company concerned and any officer of it who is in default shall be guilty of a category 4 offence.

• (7) In this section “director” does not include an alternate director.

Table

1. A fine imposed on the company in respect of an offence under this Act committed by it.
2. (1) A fine imposed on the company in respect of an offence under section 1078 of the Taxes Consolidation Act 1997 committed by it, being an offence that consists of a failure by the company to deliver a statement which it is required to deliver under section 882 of that Act or to comply with a notice served on it under section 884 of that Act.
(2) A penalty which the company has been held liable to pay under section 1071 or 1073 of the Taxes Consolidation Act 1997.

138. Supplemental provisions concerning bond referred to in section 137(2)

138. (1) In this section—

“bond” means the bond referred to in section 137(2);

“nominated person” means the person nominated under section 137(4) in relation to the bond concerned.

• (2) The bond shall also provide that, in addition to the sum referred to in section 137(2), there shall become payable under the bond to the nominated person, on demand being made, with the consent of the Revenue Commissioners, by him or her in that behalf, a sum of money (not exceeding such sum as the Revenue Commissioners and the Minister may sanction) for the purpose of defraying such expenses as may have been reasonably incurred by that person in carrying out his or her duties under section 137(3).

• (3) The nominated person shall keep all proper and usual accounts, including an income and expenditure account and a balance sheet, of all moneys received by him or her on foot of the bond and of all disbursements made by him or her from any such moneys.

• (4) The Minister, after consultation with the Minister for Public Expenditure and Reform, the Revenue Commissioners and any other person who, in the opinion of the Minister, might be concerned with or interested in the matter, may prescribe—

• (a) that arrangements in relation to the bond shall only be entered into with persons of a prescribed class or classes;

• (b) the form of that bond and the minimum period to be specified in the bond as being the period for which it shall be valid.

• (5) A copy of the bond held by a company shall be appended—

• (a) in case none of the directors (within the meaning of section 137) of the company is resident in an EEA state on its incorporation, to the statement required by section 21(1)(a) to be delivered to the Registrar in relation to the company;

• (b) in case a notification is made under section 139 to the Registrar in relation to the company, to that notification;

• (c) in case during the period to which an annual return concerning the company relates none of the directors (within the meaning of section 137) of the company is resident in an EEA state, to that annual return (unless such a copy has been appended to a notification under section 139 made to the Registrar in that period).

139. Notification requirement as regards non-residency of director

139. (1) Without prejudice to anything in section 149, if a person ceases to be a director of a company and, at the time of that cessation—

• (a) he or she is resident in an EEA state; and

• (b) either—

• (i) he or she was the sole director, or

• (ii) to his or her knowledge, no other director of the company is resident in an EEA state,

that person shall, within 14 days after the date of that cessation, notify, in writing, the Registrar of that cessation and the matter referred to in paragraph (b)(i) or (ii), as the case may be.

• (2) A notification in writing to the Registrar of the matter referred to in subsection (1)(b)(i) or (ii) shall not, of itself, be regarded as constituting defamatory matter.

• (3) If a person fails to comply with subsection (1), he or she shall be jointly and severally liable with the company of which he or she has ceased to be director for any fine or penalty referred to in section 137(2) imposed on the company, or which it is held liable to pay, after that cessation.

• (4) Any such fine or penalty for which that person is so liable may be recovered by the Registrar or the Revenue Commissioners, as appropriate, from him or her as a simple contract debt in any court of competent jurisdiction.

• (5) In this section “director” does not include an alternate director.

140. Exception to section 137 — companies having real and continuous link with economic activity in State

140. (1) Section 137(1) shall not apply in relation to a company in respect of which there is in force a certificate under this section.

• (2) The Registrar may grant to a company, on application in the prescribed form being made by it in that behalf, a certificate stating that the company has a real and continuous link with one or more economic activities that are being carried on in the State.

• (3) The Registrar shall not grant such a certificate unless the company concerned tenders proof to him or her that it has such a link.

• (4) A statement referred to in subsection (5) that is tendered by the applicant shall be deemed to be proof, for the purposes of subsection (3), that the applicant has such a link.

• (5) That statement is a statement in writing that has been given to the company concerned by the Revenue Commissioners within the period of 2 months ending before the date on which an application is made under subsection (2) by the company and which states that the Revenue Commissioners have reasonable grounds to believe that the company has a real and continuous link with one or more economic activities being carried on in the State.

• (6) If, in consequence of information that has come into the possession of the Registrar, the Registrar is of opinion that a company in respect of which a certificate under subsection (2) has been granted has ceased to have a real and continuous link with any economic activity being carried on in the State, he or she shall revoke that certificate.

• (7) If, in consequence of information that has come into their possession, the Revenue Commissioners are of opinion that a company in respect of which a certificate under subsection (2) has been granted has ceased to have a real and continuous link with any economic activity being carried on in the State, the following applies—

• (a) the Commissioners may give a notice in writing to the Registrar stating that they are of that opinion; and

• (b) such a notice that is received by the Registrar shall constitute information in his or her possession for the purposes of subsection (6).

• (8) Subsection (7)(a) has effect notwithstanding any obligations as to secrecy or other restrictions upon disclosure of information imposed by or under statute or otherwise.

• (9) For the purposes of this section a company has a real and continuous link with an economic activity that is being carried on in the State if one or more of the following conditions are satisfied by it—

• (a) the affairs of the company are managed by one or more persons from a place of business established in the State and that person or those persons is or are authorised by the company to act on its behalf;

• (b) the company carries on a trade in the State;

• (c) the company is a subsidiary or a holding company of a company or other body corporate that satisfies either or both of the conditions specified in paragraphs (a) and (b);

• (d) the company is a subsidiary of a company, another subsidiary of which satisfies either or both of the conditions specified in paragraphs (a) and (b).

141. Provisions for determining whether director resident in State

141. (1) So far as it is the person's residence in the State that falls to be determined for the purposes of those sections, for the purposes of sections 137 and 139 a person is resident in the State at a particular time (the “relevant time”) if—

• (a) he or she is present in the State at—

• (i) any one time or several times in the period of 12 months preceding the relevant time (the “immediate 12 month period”) for a period in the aggregate amounting to 183 days or more; or

• (ii) any one time or several times—

• (I) in the immediate 12 month period; and

• (II) in the period of 12 months preceding the immediate 12 month period (the “previous 12 month period”),

for a period (being a period comprising in the aggregate the number of days on which the person is present in the State in the immediate 12 month period and the number of days on which the person was present in the State in the previous 12 month period) in the aggregate amounting to 280 days or more; or

• (b) that time is in a year of assessment (within the meaning of the Taxes Consolidation Act 1997) in respect of which the person has made an election under section 819(3) of that Act.

• (2) Notwithstanding subsection (1)(a)(ii), where in the immediate 12 month period concerned a person is present in the State at any one time or several times for a period in the aggregate amounting to not more than 30 days—

• (a) the person shall not be resident in the State, for the purposes of section 137 or 139, at the relevant time concerned; and

• (b) no account shall be taken of the period for the purposes of the aggregate mentioned in subsection (1)(a)(ii).

• (3) For the purposes of subsections (1) and (2)—

• (a) references in this section to a person’s being present in the State are references to the person’s being personally present in the State; and

• (b) a person shall be deemed to be present in the State for a day if the person is present in the State at any time during that day.

142. Limitation on number of directorships

142. (1) A person shall not, at a particular time, be a director of more than—

• (a) 25 private companies limited by shares; or

• (b) 25 companies, one, or more than one, of which is a private company limited by shares and one, or more than one, of which is any other type of company capable of being wound up under this Act.

• (2) Subsections (3) to (7) apply in reckoning, for the purposes of subsection (1) (the “relevant purposes”), the number of companies of which the person concerned is a director at a particular time (the “relevant time”) and a reference in them to a company, without qualification, includes a reference to any type of company capable of being wound up under this Act.

• (3) Without prejudice to the following subsections, there shall not be included for the relevant purposes any of the following companies of which the person is a director at the relevant time, namely—

• (a) a public limited company;

• (b) a company in respect of which a certificate under section 140 is in force.

• (4) There shall not be included, for the relevant purposes, any company of which the person is a director at the relevant time (not being a time that is before the date of the giving of the certificate or direction referred to subsequently in this subsection) if—

• (a) the person, or the company, delivers to the Registrar a notice, in the prescribed form, stating that the company is a company falling within one or more of the categories of company specified in the Table to this section; and

• (b) either—

• (i) the Registrar, having considered that notice and having made such enquiries as he or she thinks fit, certifies in writing, or as the case may be the Minister under subsection (7) so certifies, that the company is a company falling within one or more of the foregoing categories; or

• (ii) the Minister directs, under subsection (7), that the company is not to be included amongst the companies for the relevant purposes.

• (5) There shall, for the relevant purposes, be counted as the one company of which the person is a director at the relevant time, 2 or more companies of which he or she is a director at that time if one of those companies is the holding company of the other or others.

• (6) For the purposes of subsection (4)(b)(i), the Registrar may accept as sufficient evidence that the company concerned falls within a category of company specified in the Table to this section a declaration, in the prescribed form, to that effect made by an officer of the company or the other person referred to in subsection (4)(a).

• (7) If the Registrar refuses to certify that the company to which a notice under subsection (4)(a) relates is a company falling within a category of company specified in the Table to this section, the company or the person referred to in subsection (4)(a) may appeal to the Minister against such a refusal and the Minister may, having considered the matter and made such enquiries as he or she thinks fit, do one of the following:

• (a) confirm the decision of the Registrar;

• (b) certify in writing that the company is a company falling within a foregoing category; or

• (c) notwithstanding that he or she confirms the decision of the Registrar, direct that the company is not to be included amongst the companies that shall be reckoned for the purposes of subsection (1) in so far as that subsection applies to the person concerned but shall only give such a direction if—

• (i) the person concerned was a director of the company before 18 April 2000; and

• (ii) in the opinion of the Minister the inclusion of the company amongst the companies that shall be reckoned for the purposes of subsection (1), in so far as that subsection applies to the person concerned, would result in serious injustice or hardship to that person; and

• (iii) the giving of the direction would not operate against the common good.

• (8) A notice referred to in subsection (4)(a) may, for the purposes of that provision, be delivered to the Registrar before the person concerned becomes a director of the company to which the notice relates.

Table

A company that is the holder of a licence under section 9 of the Central Bank Act 1971 or is exempt from the requirement under that Act to hold such a licence.
A company falling within any provision (in so far as applicable to a private company limited by shares) of Schedule 5.

143. Sanctions for contravention of section 142 and supplemental provisions

143. (1) If a person, in contravention of section 142(1), purports to become, or purports to remain, a director of one or more companies he or she shall be guilty of a category 4 offence.

• (2) An appointment of a person as a director of a company shall, if it contravenes section 142(1), be void.

• (3) For the avoidance of doubt—

• (a) each purported appointment, in excess of the limit (reckoned in accordance with section 142(3) to (7)) that is provided for by section 142(1), of a person as a director of a company shall constitute a separate contravention of section 142(1);

• (b) an appointment, not in excess of the foregoing limit, of a person as a director of a company shall not, by virtue of this section, become unlawful, be rendered void or cease to have effect by reason of a subsequent appointment, in excess of that limit, of the person as a director of a company.

• (4) If—

• (a) the appointments of a person as a director of 2 or more companies are made at the same time; or

• (b) the times at which the appointments of a person as a director of 2 or more companies were made are not capable of being distinguished from one another,

then those appointments shall, for the purposes of section 142, be deemed to have been made at different times on the day concerned and in the same order as the order in which the companies to which the appointments relate were registered under this Act, the prior Companies Acts or any other former enactment relating to companies (within the meaning of section 5), as the case may be.

• (5) A reference in this section to a company includes a reference to any type of company capable of being wound up under this Act.

144. Appointment of director

144. (1) Any purported appointment of a director without that director's consent shall be void.

• (2) Subject to subsection (1), the first directors of a company shall be those persons determined in writing by the subscribers of the constitution or a majority of them.

• (3) Save to the extent that the company's constitution provides otherwise and subject to subsection (5) in the case of a single-member company—

• (a) subsequent directors of a company may be appointed by the members in general meeting, provided that no person other than a director retiring at the meeting shall, save where recommended by the directors, be eligible for election to the office of director at any general meeting unless the requirements of subsection (4) as to his or her eligibility for that purpose have been complied with;

• (b) the directors of the company may from time to time appoint any person to be a director of the company, either to fill a casual vacancy or as an addition to the existing directors, but so that the total number of directors of the company shall not at any time exceed the number, if any, provided for in its constitution;

• (c) any director appointed as mentioned in paragraph (b) shall hold office only until the next following annual general meeting, and shall then be eligible for re-election;

• (d) the company may from time to time, by ordinary resolution, increase or reduce the number of directors;

• (e) the company may, by ordinary resolution, appoint another person in place of a director removed from office under section 146 and, without prejudice to the powers of the directors under subsection (3)(b), the company in general meeting may appoint any person to be a director either to fill a casual vacancy or as an additional director.

• (4) The following are the requirements mentioned in subsection (3)(a) for the eligibility of a person (the “person concerned”) for election as a director at a general meeting, namely, not less than 3 nor more than 21 days before the day appointed for the meeting there shall have been left at the company’s registered office—

• (a) notice in writing signed by a member of the company duly qualified to attend and vote at the meeting for which such notice is given, of his or her intention to propose the person concerned for such election; and

• (b) notice in writing signed by the person concerned of his or her willingness to be so elected.

• (5) Subject to subsection (1), in the case of a single-member company, the sole member may appoint a person to be a director of the company by serving a notice in writing on the company which states that the named person is appointed director and this applies notwithstanding anything in subsection (3) (save for the requirement of it that any limit for the time being on the number of the directors is to be observed) or subsection (4).

145. Appointment of directors to be voted on individually

145. (1) At a general meeting of a company, a motion for the appointment of 2 or more persons as directors of the company by a single resolution shall not be made, unless a resolution that it shall be so made has first been agreed to by the meeting without any vote being given against it.

• (2) Subject to subsections (3) and (4), a resolution moved in contravention of this section shall be void, whether or not its being so moved was objected to at the time.

• (3) Subsection (2) shall not be taken as excluding the operation of section 135.

• (4) Where a resolution moved in contravention of this section is passed, no provision for the automatic re-appointment of retiring directors in default of another appointment shall apply.

• (5) For the purposes of this section, a motion for approving a person's appointment or for nominating a person for appointment shall be treated as a motion for his or her appointment.

• (6) Nothing in this section shall apply to a resolution amending the company's constitution.

146. Removal of directors

146. (1) A company may by ordinary resolution remove a director before the expiration of his or her period of office notwithstanding anything in its constitution or in any agreement between it and him or her.

• (2) Subsection (1) shall not authorise the removal of a director holding office for life.

• (3) In the case of a resolution to remove a director under this section or to appoint somebody instead of the director so removed at the meeting at which he or she is removed the following provisions shall apply—

• (a) the company shall be given not less than 28 days' notice of the intention to move any such resolution except when the directors of the company have resolved to submit it;

• (b) on receipt of notice of such an intended resolution, the company shall forthwith send a copy of it to the director concerned, and the director (whether or not he or she is a member of the company) shall be entitled to be heard on the resolution at the meeting; and

• (c) the company shall give its members notice of any such resolution at the same time and in the same manner as it gives notice of the meeting or, if that is not practicable, shall give them notice of it, either by advertisement in a daily newspaper circulating in the district in which the registered office of the company is situated or in any other manner allowed by this Act or by the constitution, not less than 21 days before the date of the meeting.

• (4) Any such resolution that is passed that does not comply with the foregoing provisions shall, subject to subsection (5), not be effective.

• (5) If, after notice of the intention to move such a resolution has been given to the company, a meeting is called for a date 28 days or less after the notice has been given, the notice, though not given within the time required by subsection (3)(a), shall be deemed to have been properly given for the purposes of that provision.

• (6) Subject to subsection (8), where notice is given of an intended resolution to remove a director under this section and the director concerned makes in relation to that resolution representations in writing to the company (not exceeding a reasonable length) and requests their notification to the members of the company, the company shall, unless the representations are received by it too late for it to do so—

• (a) in any notice of the resolution given to members of the company, state the fact of the representations having been made; and

• (b) send a copy of the representations to every member of the company to whom notice of the meeting is sent (whether before or after receipt of the representations by the company).

• (7) If a copy of the representations is not sent as mentioned in subsection (6) (either because they were received too late or because of the company's default) the director concerned may, without prejudice to his or her right to be heard orally, require that the representations shall be read out at the meeting concerned.

• (8) Copies of the representations need not be sent out, and the representations need not be read out at the meeting concerned, as mentioned in subsection (6) or (7), if, on the application either of the company or of any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this section are being abused to secure needless publicity for defamatory matter and orders that those things need not be done.

• (9) The court may order the company's costs on such an application to be paid in whole or in part by the director concerned, notwithstanding that he or she is not a party to the application.

• (10) A vacancy created by the removal of a director under this section may be filled at the meeting at which he or she is removed and, if not so filled, may be filled as a casual vacancy.

• (11) A person appointed director in place of a person removed under this section shall be treated, for the purpose of determining the time at which he or she or any other director is to retire, as if he or she had become director on the day on which the person in whose place he or she is appointed was last appointed director.

147. Compensation for wrongful termination, other powers of removal not affected by section 146

147. Nothing in section 146 shall be taken—

• (a) as depriving a person removed under it of compensation or damages payable to him or her, or any other remedy available to the person, in respect of the termination of his or her appointment as director or of any appointment terminating with that as director; or

• (b) as derogating from any power to remove a director that may exist apart from that section.

148. Vacation of office

148. (1) In addition to the case provided by section 136 (share qualification of directors), the office of director shall be vacated if the director—

• (a) is adjudicated bankrupt or being a bankrupt has not obtained a certificate of discharge in the relevant jurisdiction; or

• (b) becomes or is deemed to be subject to a disqualification order within the meaning of Chapter 4 of Part 14.

• (2) Save to the extent that the company’s constitution provides otherwise, the office of director shall be vacated if—

• (a) the director resigns his or her office by notice in writing to the company; or

• (b) the health of the director is such that he or she can no longer be reasonably regarded as possessing an adequate decision making capacity; or

• (c) a declaration of restriction is made in relation to the director and the directors, at any time during the currency of the declaration, resolve that his or her office be vacated; or

• (d) the director is sentenced to a term of imprisonment following conviction of an indictable offence; or

• (e) the director is for more than 6 months absent, without the permission of the directors, from meetings of the directors held during that period.

• (3) In subsection (2)(d) the reference to a term of imprisonment includes a reference to such a term that is suspended.

149. Register of directors and secretaries

149. (1) A company shall keep a register (the “register”) of its directors and secretaries and, if any, its assistant and deputy secretaries.

• (2) Subject to subsection (4) and section 150(11), the register shall contain the following particulars relating to each director:

• (a) his or her present forename and surname and any former forename and surname;

• (b) his or her date of birth;

• (c) his or her usual residential address;

• (d) his or her nationality;

• (e) his or her business occupation, if any; and

• (f) particulars of any other directorships of bodies corporate, whether incorporated in the State or elsewhere, held by him or her or which have been held by him or her.

• (3) Sections 215 to 217 (rights of inspection, requests for copies, etc.) apply to the register.

• (4) It shall not be necessary for the register to contain on any day particulars of any directorship—

• (a) which has not been held by a director at any time during the 5 years preceding that day;

• (b) which is held or was held by a director in bodies corporate of which the company is or was the wholly owned subsidiary or which are or were the wholly owned subsidiaries either of the company or of another body corporate of which the company is or was the wholly owned subsidiary.

• (5) Subject to subsection (6) and section 150(11), the register shall contain the following particulars relating to the secretary or, where there are joint secretaries, in relation to each of them—

• (a) in the case of an individual—

• (i) his or her present forename and surname and any former forename and surname;

• (ii) his or her usual residential address; and

• (iii) his or her date of birth,

and

• (b) in the case of a body corporate, the corporate name and, if the body corporate is registered—

• (i) its registered office;

• (ii) the register in which it is registered; and

• (iii) the number under which it is registered in that register.

• (6) Where all the partners in a firm are joint secretaries of a company, the name and principal office of the firm may be stated instead of the particulars referred to in subsection (5).

• (7) In relation to any assistant or deputy secretary the same particulars shall be contained in the register as respects the assistant or deputy secretary as are required by subsection (5) to be contained in the register as respects a secretary or joint secretary.

• (8) The company shall, within the period of 14 days after the date of the happening of—

• (a) any change among its directors or in its secretary or assistant or deputy secretary; or

• (b) any change in any of the particulars contained in the register,

send to the Registrar a notification in the prescribed form of the change and of the date on which it occurred.

• (9) In the case of a person who is a director of more than one company (the “relevant companies”) the following provisions apply—

• (a) the person may send a notification in the prescribed form to the Registrar of a change in his or her usual residential address or of a change in his or her name and (in each case) of the date on which the change occurred;

• (b) if such a notification is sent to the Registrar and the relevant companies are listed in the notification as being companies of which the person is a director—

• (i) each of the relevant companies shall be relieved, as respects, and only as respects, that particular change or, as the case may be, those particular changes, of the obligation under subsection (8) to send a notification of it or them to the Registrar; and

• (ii) the Registrar may proceed to record the relevant change or changes concerning the person in relation to each of the relevant companies.

• (10) A notification sent to the Registrar pursuant to subsection (8) of the appointment of a person as a director, secretary, joint secretary or assistant or deputy secretary of a company shall be accompanied by a consent signed by that person to act as director or secretary or assistant or deputy secretary or, where all the partners in a firm have been appointed joint secretaries of a company, by one partner on behalf of the firm, as the case may be.

• (11) Section 223(3), in the case of a director, and section 226(5), in the case of a secretary, requires the inclusion of a particular statement in a foregoing consent by him or her.

• (12) For the purposes of this section—

• (a) in the case of a person usually known by a title different from his or her surname, the expression “surname” means that title;

• (b) references to a “former forename” or “surname” do not include—

• (i) in the case of a person usually known by a title different from his or her surname, the name by which he or she was known previous to the adoption of or succession to the title; or

• (ii) in the case of any person, a former forename or surname where that name or surname was changed or disused before the person bearing the name attained the age of 18 years or has been changed or disused for a period of not less than 20 years, or

• (iii) in the case of a married person or civil partner, the name or surname by which he or she was known previously to his or her marriage or civil partnership.

150. Supplemental provisions (including offences) in relation to section 149

150. (1) Without prejudice to the generality of section 149(8), a change among the directors for the purposes of that provision shall be deemed to include the case of a director's becoming disqualified under the law of another state (whether pursuant to an order of a judge or a tribunal or otherwise) from being appointed or acting as a director or secretary of a body corporate or an undertaking; accordingly, in such a case, the notice under section 149(8) shall state, in relation to the director concerned—

• (a) the jurisdiction in which he or she has become so disqualified;

• (b) the date on which he or she has become so disqualified; and

• (c) the period for which he or she has become so disqualified.

• (2) Without prejudice to subsection (1) and to the requirement under section 149(10) that the notification be accompanied by the consent there referred to, if—

• (a) the notification to be sent to the Registrar pursuant to section 149(8) is a notification of the appointment of a person as a director of a company; and

• (b) that person is a person who is disqualified under the law of another state (whether pursuant to an order of a judge or a tribunal or otherwise) from being appointed or acting as a director or secretary of a body corporate or an undertaking,

that person shall ensure that the notification is accompanied by (but as a separate document from that notification) a statement in the prescribed form signed by the person specifying—

• (i) the jurisdiction in which he or she is so disqualified;

• (ii) the date on which he or she became so disqualified; and

• (iii) the period for which he or she is so disqualified.

• (3) It shall be the duty of each director and secretary and assistant or deputy secretary, if any, of a company to give information in writing to the company as soon as may be of such matters as may be necessary to enable the company to comply with section 149 and the preceding subsections of this section.

• (4) If default is made in complying with section 149(1), (2), (5), (7), (8) or (10), the company concerned and any officer of it who is in default shall be guilty of a category 3 offence.

• (5) A person who fails to comply with subsection (1) shall be guilty of a category 3 offence.

• (6) If the second mentioned person in subsection (2) fails to comply with that subsection, he or she shall be guilty of a category 3 offence.

• (7) A person who fails to comply with subsection (3) shall be guilty of a category 3 offence.

• (8) Without prejudice to subsection (3) or (6) and notwithstanding anything in subsection (2), it shall be the duty of a company to make reasonable enquiries of a person, on his or her appointment as director of the company, so as to ascertain whether the requirements of subsection (2) fall to be complied with by that person in relation to that appointment (but a failure of the company to do so does not relieve the person of his or her obligations under that subsection).

• (9) If a person appointed a director of a company before the commencement of this section has, subsequent to his or her appointment but before that commencement, become disqualified under the law of another state (whether pursuant to an order of a judge or a tribunal or otherwise) from being appointed or acting as director or secretary of a body corporate or an undertaking, then subsection (1) shall apply to such a case as it applies to a case of a director becoming so disqualified after that commencement.

• (10) For the purpose of the application of subsection (1) to the case first-mentioned in the preceding subsection, section 149 shall apply as if the following subsection were substituted for subsection (8):

• “(8) The company shall, within the period of 3 months after the commencement of this section, send to the Registrar a notification in the prescribed form of the change and of the date on which it occurred.”.

• (11) The Minister may make regulations providing that any requirement of this Act that the usual residential address of an officer of a company appear on the register referred to in section 149(1) or the register kept by the Registrar shall not apply in relation to a particular person who is such an officer if—