Legalize / Ireland / Act

Companies Act 2014

Type Act

Publication 2014-12-23

Last updated 2026-07-15

State Partially repealed

Text Latest available text

Source Irish Statute Book

PDF Download

articles 1871

This is the most recent text the official source publishes. It is not a snapshot of the law as it stood on the date of each change.

87 amending acts · 2026-07-15, NATIONAL TREASURY MANAGEMENT AGENCY (MISCELLANEOUS PROVISIONS) ACT 2026

Act to consolidate, with amendments, certain enactments relating to companies and to provide for related matters

Reform history JSON API

(a) the directors’ and secretaries’ register;

(b) the disclosable interests register;

(10) The copies of instruments creating charges shall be open to the inspection of any creditor of the company without charge.

(11) A member of the company may request a copy, or a copy of any part, of—

(a) the directors’ and secretaries’ register;

(b) the disclosable interests register;

(d) the minutes of meetings.

(12) Any other person may request a copy, or a copy of any part, of—

(a) the directors’ and secretaries’ register;

(b) the disclosable interests register; or

(13) A company shall, within 10 days after the date of receipt of a request under subsection (11) or (12) and on payment to it of the relevant fee by the requester, cause to be sent to the requester the copy, or part of it, concerned.

217. Supplemental provisions in relation to section 216 — “relevant fee”, power to alter the amount of it, offences, etc.

217. (1) In section 216 “relevant fee” means—

(a) in a case falling within subsection (9) of that section—

(i) where one register is inspected, €10.00 or such less sum as the company may determine; or

(ii) subject to subsection (2), where more than one register is inspected on the same day or in any period of 24 consecutive hours, €15.00 or such less sum as the company may determine;

(b) in a case falling within subsection (13) of that section, €10.00 per copy or such less sum as the company may determine.

(2) Subsection (1)(a)(ii) only applies if—

(a) the inspections concerned are made by, or on behalf of, the same person; and

(b) at the time the first request for inspection is made (by, or on behalf of, the same person) during the period concerned it is indicated to the company that more than one register will be inspected (by, or on behalf of, that person) during that period.

(3) If a company fails to comply with any of subsections (3) to (10), or subsection (13), of section 216, the company and any officer of it who is in default shall be guilty of a category 3 offence.

(4) The court may, on application being made to it, make the following orders:

(a) in the case of a failure to comply with any of subsections (7) to (10) of section 216, an order compelling an immediate inspection of the register or document concerned;

(b) in the case of a failure to comply with section 216(13), an order directing that the copy requested be sent to the person requesting it.

(5) Subject to subsections (6) to (8), the Minister may, by order, alter a sum specified in paragraph (a) or (b) of the definition of “relevant fee” in this section.

(6) An order under subsection (5) may only be made, at a particular time (the “relevant time”), if it appears to the Minister the changes in the value of money generally in the State that have occurred during the period beginning—

(a) on this Act’s passing, or

(b) if the powers under that subsection have previously been exercised, immediately after their last previous exercise,

and ending at the relevant time warrant the exercise of powers under that subsection for the following purpose.

(7) That purpose is to relieve companies of an additional financial expense that they would otherwise incur (by reason of the foregoing changes) in complying with the provisions specified in the definition of “relevant fee” in this section if the powers under subsection (5) were not exercised at the relevant time.

(8) Without prejudice to subsections (6) and (7), in making any order under subsection (5), the Minister shall take into account the general costs incurred by a company in facilitating the inspection, or providing copies, of the registers or other documents referred to in the provisions specified in the definition of “relevant fee” in this section.

218. Service of notices on members

218. (1) Subsections (3) and (4) shall apply to any case in which a provision of this Act, or of the company's constitution, requires or authorises a notice to be served on or given to a member of the company by the company, or an officer of it, but save to the extent that the constitution provides otherwise.

(2) Subsection (5) shall only apply if there is contained in the company's constitution a provision to the effect that it shall apply (but nothing in this subsection shall prevent alternative and reasonable provision being made in the constitution with regard to one or more of the matters set out in that subsection and, to the extent that such alternative and reasonable provision is made, that provision shall apply instead of that subsection).

(3) A notice referred to in subsection (1) shall, save where the means of serving or giving it specified in paragraph (d) is used, be in writing and may be served on or given to the member in one of the following ways:

(a) by delivering it to the member;

(b) by leaving it at the registered address of the member;

(d) if the company’s constitution permits the use of electronic means to serve or give the notice or the conditions specified in subsection (4) are satisfied, by electronic means.

(4) The conditions referred to in subsection (3)(d) are—

(a) the member has consented in writing to the company, or the officer of it, using electronic means to serve or give notices in relation to him or her;

(b) at the time the electronic means are used to serve or give the notice in relation to the member, no notice in writing has been received by the company or the officer concerned from the member stating he or she has withdrawn the consent referred to in paragraph (a); and

(5) Any notice served or given in accordance with subsection (3) shall be deemed, in the absence of any agreement to the contrary between the company (or, as the case may be, the officer of it) and the member, to have been served or given—

(a) in the case of its being delivered, at the time of delivery (or, if delivery is refused, when tendered);

(b) in the case of its being left, at the time that it is left;

(c) in the case of its being posted (to an address in the State) on any day other than a Friday, Saturday or Sunday, 24 hours after despatch and in the case of its being posted (to such an address)—

(i) on a Friday — 72 hours after despatch; or

(ii) on a Saturday or Sunday — 48 hours after despatch;

(d) in the case of electronic means being used in relation to it, 12 hours after despatch,

but this subsection is without prejudice to section 181(3).

(6) In this section “registered address”, in relation to a member, means the address of the member as entered in the register of members.

PART 5 DUTIES OF DIRECTORS AND OTHER OFFICERS

CHAPTER 1 Preliminary and definitions

219. Interpretation and application (Part 5)

219. (1) In this Part—

“credit transaction” has the meaning given to it by subsection (3);

“guarantee” includes an indemnity;

“quasi-loan” has the meaning given to it by subsection (2).

(2) For the purposes of this Part—

(a) a quasi-loan is a transaction under which one party (the “creditor”) agrees to pay, or pays otherwise than in pursuance of an agreement, a sum for another (the “borrower”) or agrees to reimburse or reimburses otherwise than in pursuance of an agreement, expenditure incurred by another party for another (the “borrower”)—

(i) on terms that the borrower (or a person on his behalf) will reimburse the creditor; or

(ii) in circumstances giving rise to a liability on the borrower to reimburse the creditor;

(b) any reference to the person to whom a quasi-loan is made is a reference to the borrower; and

(c) the liabilities of a borrower under a quasi-loan include the liabilities of any person who has agreed to reimburse the creditor on behalf of the borrower.

(3) For the purposes of this Part a credit transaction is, subject to subsection (4), a transaction under which one party (the “creditor”)—

(a) supplies any goods or sells any land under, as the case may be, a hire-purchase agreement or conditional sale agreement;

(b) leases or licenses the use of land or hires goods in return for periodical payments;

(c) otherwise disposes of land or supplies goods or services, on the understanding that payment (whether in a lump sum or instalments or by way of periodical payments or otherwise) is to be deferred.

(4) For the purposes of this Part a lease of land which reserves a nominal annual rent of not more than €100 is not a credit transaction where a company grants the lease in return for a premium or capital payment which represents the open market value of the land thereby disposed of by the company.

(5) For the purposes of this Part the value of a transaction or arrangement is—

(a) in the case of a loan, the principal of the loan;

(b) in the case of a quasi-loan, the amount or maximum amount which the person to whom the quasi-loan is made is liable to reimburse the creditor;

(c) in the case of a transaction or arrangement other than a loan or quasi-loan or a transaction or arrangement falling within paragraph (d) or (e), the price which it is reasonable to expect could be obtained for the goods, land or services to which the transaction or arrangement relates if they had been supplied at the time the transaction or arrangement is entered into in the ordinary course of business and on the same terms (apart from price) as they have been supplied or are to be supplied under the transaction or arrangement in question;

(d) in the case of a guarantee or security, the amount guaranteed or secured;

(e) in the case of an arrangement to which section 239(2) or (3) applies, the value of the transaction to which the arrangement relates less any amount by which the liabilities under the arrangement or transaction of the person for whom the transaction was made have been reduced.

(6) For the purposes of subsection (5), the value of a transaction or arrangement (or, as the case may be, of a transaction to which an arrangement relates) which is not capable of being expressed as a specific sum of money, whether because the amount of any liability arising under the transaction or arrangement is unascertainable or for any other reason, shall be deemed to exceed €65,000, and this subsection applies irrespective of whether any liability under the transaction or arrangement has been reduced.

(7) For the purposes of this Part, a transaction or arrangement is made for a person if—

(a) in the case of a loan or quasi-loan, it is made to him or her;

(b) in the case of a credit transaction, he or she is the person to whom goods or services are supplied, or land is sold or otherwise disposed of, under the transaction;

(c) in the case of a guarantee or security, it is entered into or provided in connection with a loan or quasi-loan made to him or her or a credit transaction made for him or her;

(d) in the case of an arrangement to which section 239(2) or (3) applies, the transaction to which the arrangement relates was made for him or her; and

(e) in the case of any other transaction or arrangement for the supply or transfer of goods, land or services (or any interest therein), he or she is the person to whom the goods, land or services (or the interest) are supplied or transferred.

(8) This Part does not apply to arrangements or transactions entered into before 1 February 1991 but, for the purposes of determining whether an arrangement is one to which section 239(2) or (3) applies, the transaction to which the arrangement relates shall, if it was entered into before 1 February 1991, be deemed to have been entered into after that date.

(9) This Part shall have effect in relation to an arrangement or transaction whether governed by the law of the State or of another country.

220. Connected persons

220. (1) For the purposes of this Part (and without prejudice to subsection (3)), a person is connected with a director of a company if, but only if, the person (not being himself or herself a director of the company) is—

(a) that director’s spouse, civil partner, parent, brother, sister or child;

(b) a person acting in his or her capacity as the trustee of any trust, the principal beneficiaries of which are that director, the spouse (or civil partner) or any children of that director or any body corporate which that director controls; or

(2) In subsection (1)(a) and (b) “child”, in relation to a director, shall be deemed to include a child of the director’s civil partner who is ordinarily resident with the director and the civil partner.

(3) A body corporate shall also be, for the purposes of this Part, connected with a director of a company if it is controlled by that director or by another body corporate that is controlled by that director.

(4) For the avoidance of doubt, subsection (3) is without prejudice to the application of section 18(c) of the Interpretation Act 2005 (“person” to include body corporate, etc.) to subsection (1)(b).

(5) For the purposes of this section, a director of a company controls a body corporate if, but only if, he or she is, alone or together with any other director or directors of the company or any person connected with the director or such other director or directors—

(a) interested in one-half or more of the equity share capital of that body; or

(b) entitled to exercise or control the exercise of one-half or more of the voting power at any general meeting of that body.

(6) In subsection (5)—

(a) “equity share capital” has the same meaning as it has in section 7; and

(b) references to voting power exercised by a director shall be read as including references to voting power exercised by another body corporate which that director controls.

(7) For the purpose of subsections (5)(b) and (6)(b) “voting power” does not include any power to vote which arises only in specified circumstances.

(8) It shall be presumed, for the purposes of this Part, until the contrary is shown, that the sole member of a single-member company is a person connected with a director of that company.

221. Shadow directors

221. (1) Subject to subsection (2), a person in accordance with whose directions or instructions the directors of a company are accustomed to act (in this Act referred to as a “shadow director”) shall be treated for the purposes of this Part as a director of the company unless the directors are accustomed so to act by reason only that they do so on advice given by him or her in a professional capacity.

(2) A body corporate is not to be regarded as a shadow director of any of its subsidiaries.

(3) Section 231 shall apply in relation to a shadow director of a company as it applies in relation to a director of a company, except that the shadow director shall declare his or her interest, not at a meeting of the directors, but by a notice in writing to the directors which is either—

(a) a specific notice given before the date of the meeting at which, if he or she had been a director, the declaration would be required by subsection (3) of that section to be made; or

(b) a notice which under subsection (4) of that section falls to be treated as a sufficient declaration of that interest or would fall to be so treated apart from the qualification of that subsection (4) contained in subsection (5) of that section.

(4) As respects a declaration made by either of the means referred to in subsection (3), section 166 shall have effect as if the declaration had been made at the meeting in question and had accordingly formed part of the proceedings at that meeting.

222. De facto director

222. (1) Without limiting the manner in which the expression “director” is to be read by virtue of section 2(1), a person who occupies the position of director of a company but who has not been formally appointed as such director shall, subject to subsection (4), be treated, for the purposes of this Part, as a director of the company.

(2) In particular, section 231 shall apply in relation to such a director as it applies in relation to directors generally.

(3) A person who is, by virtue of subsection (1), treated, for the purposes of this Part, as a director of a company is in this Act referred to as a de facto director.

(4) A person shall not be a de facto director of a company by reason only of the fact that he or she gives advice in a professional capacity to the company or any of the directors of it.

CHAPTER 2 General duties of directors and secretaries and liabilities of them and other officers

223. Duty of each director

223. (1) It is the duty of each director of a company to ensure that this Act is complied with by the company.

(2) The breach by a director of the duty under subsection (1) shall not of itself affect—

(a) the validity of any contract or other transaction, or

(b) the enforceability, other than by the director in breach of that duty, of any contract or other transaction by any person,

but nothing in this subsection affects the principles of liability of a third party where he or she has been an accessory to a breach of duty or has knowingly received a benefit therefrom.

(3) The consent in respect of a director to accompany—

(a) a statement under section 21(1)(a), and

(b) a notification under section 149(8),

shall include a statement by the director (immediately above his or her signature on the consent) in the following terms:

“I acknowledge that, as a director, I have legal duties and obligations imposed by the Companies Act, other statutes and at common law.”.

224. Directors to have regard to interests of employees

224. (1) The matters to which the directors of a company are to have regard in the performance of their functions shall include the interests of the company’s employees in general, as well as the interests of its members.

(2) Accordingly, the duty imposed by this section on the directors shall be owed by them to the company (and the company alone) and shall be enforceable in the same way as any other fiduciary duty owed to a company by its directors.

224A. F100[Directors to have regard to certain matters where company is, or is likely to be, unable to pay its debts

224A. (1) A director of a company who believes, or who has reasonable cause to believe, that the company is, or is likely to be, unable to pay its debts (within the meaning of section 509(3)), shall have regard to –

(a) the interests of the creditors,

(b) the need to take steps to avoid insolvency, and

(c) the need to avoid deliberate or grossly negligent conduct that threatens the viability of the business of the company.

(2) The duty imposed by this section on a director shall be owed by them to the company (and the company alone) and shall be enforceable in the same way as any other fiduciary duty owed to a company by its directors.]

225. (1) In this section—

“amount of turnover” and “balance sheet total” have the same meanings as they have in F101[section 275];

“relevant obligations”, in relation to a company, means the company’s obligations under—

(a) this Act, where a failure to comply with any such obligation would (were it to occur) be—

(i) a category 1 offence or a category 2 offence; or

(ii) a serious Market Abuse offence or a serious Prospectus offence;

and

(b) tax law;

“serious Market Abuse offence” means an offence referred to in section 1368;

“serious Prospectus offence” means an offence referred to in section 1356;

“tax law” means—

(a) the Customs Acts;

(b) the statutes relating to the duties of excise and to the management of those duties;

(d) the Capital Gains Tax Acts;

(e) the Value-Added Tax Acts;

(f) the Capital Acquisitions Tax Consolidation Act 2003 and the enactments amending or extending that Act;

(g) the Stamp Duties Consolidation Act 1999 and the enactments amending or extending that Act; and

(h) any instruments made under an enactment referred to in any of paragraphs (a) to (g) or made under any other enactment and relating to tax.

(2) The directors of a company to which this section applies shall also include in their report under section 325 a statement—

(a) acknowledging that they are responsible for securing the company’s compliance with its relevant obligations; and

(b) with respect to each of the things specified in subsection (3), confirming that the thing has been done or, if it has not been done, specifying the reasons why it has not been done.

(3) The things mentioned in subsection (2)(b) are—

(a) the drawing up of a statement (to be known, and in this Act referred to as, a “compliance policy statement”) setting out the company’s policies (that, in the directors’ opinion, are appropriate to the company) respecting compliance by the company with its relevant obligations;

(b) the putting in place of appropriate arrangements or structures that are, in the directors’ opinion, designed to secure material compliance with the company’s relevant obligations; and

(c) the conducting of a review, during the financial year to which the report referred to in subsection (2) relates, of any arrangements or structures referred to in paragraph (b) that have been put in place.

(4) The arrangements or structures referred to in subsection (3)(b) may, if the directors of the company in their discretion so decide, include reliance on the advice of one or more than one person employed by the company or retained by it under a contract for services, being a person who appears to the directors to have the requisite knowledge and experience to advise the company on compliance with its relevant obligations.

(5) For the purposes of this section, the arrangements or structures referred to in subsection (3)(b) shall be regarded as being designed to secure material compliance by the company concerned with its relevant obligations if they provide a reasonable assurance of compliance in all material respects with those obligations.

(6) If default is made in complying with subsection (2), each director to whom the default is attributable shall be guilty of a category 3 offence.

(7) Subject to subsection (8), this section shall apply to a company if, in respect of the financial year of the company to which the report referred to in subsection (2) relates—

(a) its balance sheet total for the year exceeds—

(i) subject to subparagraph (ii), €12,500,000; or

(ii) if an amount is prescribed under section 943(1)(i), the prescribed amount;

and

(b) the amount of its turnover for the year exceeds—

(i) subject to subparagraph (ii), €25,000,000; or

(ii) if an amount is prescribed under section 943(1)(i), the prescribed amount.

(8) This section does not apply to any company that is of a class exempted under section 943(1)(g) from this section.

226. Duties of secretary

226. (1) The duties of the secretary of a company shall, without derogating from the secretary’s statutory and other legal duties, be such duties as are delegated to the secretary, from time to time, by the board of directors of the company.

(2) Without prejudice to the generality of section 129(4), the directors of a company shall, in their appointment of a secretary, have a duty to ensure that the person appointed has the skills necessary so as to enable him or her maintain (or procure the maintenance of) the records (other than accounting records) required to be kept under this Act in relation to the company.

(3) The cases to which subsection (2) applies includes the case of an appointment of one of the directors of the company as secretary.

(4) In subsections (1) to (3) references to a secretary include references to joint secretaries.

(5) The consent in respect of a secretary or joint secretaries to accompany—

(a) a statement under section 21(1)(a), and

(b) a notification under section 149(8),

shall include a statement by the secretary or secretaries (immediately above the signature or signatures of the secretary or secretaries on the consent) in the following terms:

“I/We acknowledge that, as a secretary, I/we have legal duties and obligations imposed by the Companies Act, other statutes and at common law.”.

227. Fiduciary duties of directors — provisions introductory to section 228

227. (1) Without prejudice to the provisions of any enactment (including this Act), a director of a company shall owe the duties set out in section 228 (the “relevant duties”) to the company (and the company alone).

(2) The breach by a director of the relevant duties shall not of itself affect—

(a) the validity of any contract or other transaction, or

(b) the enforceability, other than by the director in breach of that duty, of any contract or other transaction by any person,

but nothing in this subsection affects the principles of liability of a third party where he or she has been an accessory to a breach of duty or has knowingly received a benefit therefrom.

(3) The relevant duties shall be enforced in the same way as any other fiduciary duty owed to a company by its directors.

(4) The relevant duties (other than those set out in section 228(1)(b) and (h)) are based on certain common law rules and equitable principles as they apply in relation to the directors of companies and shall have effect in place of those rules and principles as regards the duties owed to a company by a director.

(5) The relevant duties (other than those set out in section 228(1)(b) and (h)) shall be interpreted, and the provisions concerned of section 228 shall be applied, in the same way as common law rules or equitable principles; regard shall be had to the corresponding common law rules and equitable principles in interpreting those duties and applying those provisions.

228. Statement of principal fiduciary duties of directors

228. (1) A director of a company shall—

(a) act in good faith in what the director considers to be the interests of the company;

(b) act honestly and responsibly in relation to the conduct of the affairs of the company;

(c) act in accordance with the company’s constitution and exercise his or her powers only for the purposes allowed by law;

(d) not use the company’s property, information or opportunities for his or her own or anyone else’s benefit unless—

(i) this is expressly permitted by the company’s constitution; or

(ii) the use has been approved by a resolution of the company in general meeting;

(e) not agree to restrict the director’s power to exercise an independent judgment unless—

(i) this is expressly permitted by the company’s constitution;

(ii) the case concerned falls within subsection (2); or

(iii) the director’s agreeing to such has been approved by a resolution of the company in general meeting;

(f) avoid any conflict between the director’s duties to the company and the director’s other (including personal) interests unless the director is released from his or her duty to the company in relation to the matter concerned, whether in accordance with provisions of the company’s constitution in that behalf or by a resolution of it in general meeting;

(g) exercise the care, skill and diligence which would be exercised in the same circumstances by a reasonable person having both—

(i) the knowledge and experience that may reasonably be expected of a person in the same position as the director; and

(ii) the knowledge and experience F102[which the director has;]

and

(h) in addition to the duty under section 224 (duty to have regard to the interests of its employees in general), have regard to the F102[interests of its members; and]

F103[(i) in addition to the duties under section 224A (directors to have regard to certain matters where company is, or is likely to be, unable to pay its debts), have regard to the interests of its creditors where the directors become aware of the company’s insolvency.]

(2) If a director of a company considers in good faith that it is in the interests of the company for a transaction or engagement to be entered into and carried into effect, a director may restrict the director’s power to exercise an independent judgment in the future by agreeing to act in a particular way to achieve this.

(3) Without prejudice to the director’s duty under subsection (1)(a) to act in good faith in what the director considers to be the interests of the company, a director of a company may have regard to the interests of a particular member of the company in the following circumstances.

(4) Those circumstances are where the director has been appointed or nominated for appointment by that member, being a member who has an entitlement to so appoint or nominate under the company’s constitution or a shareholders’ agreement.

229. Other interests of directors

229. (1) Save to the extent that the company’s constitution provides otherwise, a director of a company may be or become a director or other officer of, or otherwise interested in, any company promoted by the company or in which the company may be interested as shareholder or otherwise; but neither this subsection nor anything in the company’s constitution governing the foregoing matter overrides section 228.

(2) No such director shall be accountable to the company for any remuneration or other benefits received by him or her as a director or officer of, or from his or her interest in, such other company unless the company otherwise directs.

230. Power of director to act in a professional capacity for company

230. Save to the extent that the company’s constitution provides otherwise—

(a) any director may act by himself or herself, or his or her firm, in a professional capacity for the company of which he or she is a director, and

(b) any director, in such a case, or his or her firm, shall be entitled to remuneration for professional services as if he or she were not a director,

but nothing in this section authorises a director, or his or her firm, to act as statutory auditor of a company of which he or she is director.

231. Duty of director to disclose his or her interest in contracts made by company

231. (1) It shall be the duty of a director of a company who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the company, to declare the nature of his or her interest at a meeting of the directors of the company.

(2) Subsection (1) does not apply in relation to an interest that cannot reasonably be regarded as likely to give rise to a conflict of interest.

(3) The declaration required by this section to be made by a director shall—

(a) in the case of a proposed contract, be made at the meeting of the directors at which the question of entering into the contract is first taken into consideration or, if the director was not at the date of that meeting interested in the proposed contract, at the next meeting of the directors held after he or she became so interested; and

(b) in the case of his or her becoming interested in a contract after it is made, be made at the first meeting of the directors held after the director becomes so interested.

(4) Subject to subsection (5), for the purposes of this section a general notice given to the directors of a company by a director to the effect that—

(a) he or she is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm, or

(b) he or she is to be regarded as interested in any contract which may, after the date of the notice, be made with a specified person who is connected with him or her,

shall be deemed to be a sufficient declaration of interest in relation to any such contract.

(5) No such notice as is mentioned in subsection (4) shall be of effect unless it is given at the meeting of directors or the director takes reasonable steps to secure that it is brought up and read at the next meeting of the directors after it is given.

(6) A copy of every declaration made and notice given in pursuance of this section shall, within 3 days after the date of making or giving of it, be entered into a book kept by the company for this purpose.

(7) That book shall be open for inspection, without any charge, by any director, secretary, statutory auditor or member of the company at the registered office of the company and shall be produced at—

(a) every general meeting of the company; and

(b) any meeting of its directors if any of its directors so requests in sufficient time to enable the book to be available at the meeting.

(8) A company shall, if required by the F104[Authority, produce to the Authority for inspection the book kept by it in accordance with subsection (6) and shall give the Authority such facilities for inspecting and taking copies of the contents of the book as the Authority] may require.

(9) Nothing in this section shall be taken to prejudice the operation of any enactment or rule of law restricting directors of a company from having interests in contracts with the company.

(10) Any reference in this section to a contract—

(a) shall be read as excluding a reference to a contract the decision as to whether to enter into it is taken, or falls to be taken, other than by the board of directors or a committee of which the first-mentioned director in subsection (1) is a member;

(b) shall be read as including a reference to any transaction or arrangement, whether or not constituting a contract, but, in a case where the transaction or arrangement does not constitute a contract, a like limitation to that which applies under paragraph (a) applies to the construction of reference provided by this paragraph.

(11) For the purposes of this section, a transaction or arrangement of a kind described in section 239 made by a company for a director of the company or a person connected with such a director shall, if it would not otherwise be so treated (and whether or not prohibited by that section), be treated as a transaction or arrangement in which that director is interested.

232. Breaches of certain duties: liability to account and indemnify

232. (1) Subject to section 233, where a director of a company acts in breach of his or her duty under section 228(1)(a), (c), (d), (e), F105[(f), (g) or (i)], he or she shall be liable to do either or both (as the corresponding common law rule or equitable principle with respect to the matter would have required) of the following things, namely—

(a) account to the company for any gain which he or she makes directly or indirectly from the breach of duty;

(b) indemnify the company for any loss or damage resulting from that breach.

(2) Subject to subsection (6), where a company enters into a transaction or arrangement contrary to section 238 or 239 with—

(a) a director of the company,

(b) a director of its holding company, or

that director and the person so connected and any other director of the company who authorised the transaction or arrangement (or, as the case may be, any transaction entered into in pursuance of the arrangement) shall be liable—

(i) to account to the company for any gain which he or she makes directly or indirectly from the transaction or arrangement;

(ii) (jointly and severally with any other person liable under this subsection) to indemnify the company for any loss or damage resulting from the transaction or arrangement; or

(iii) to do both of those things as the circumstances may require.

(3) Subject to section 233, where a company makes a payment to a director contrary to section 251 or 252 that director shall be liable—

(a) to account to the company for any gain which he or she makes directly or indirectly from the payment,

(b) to indemnify the company for any loss or damage resulting from the payment, or

and, in the case of section 252, this is without prejudice to subsection (3) of that section.

(4) Subsection (2) applies irrespective of whether the transaction or arrangement concerned has been avoided.

(5) Subsections (1) to (3) are without prejudice to—

(a) the company’s right at common law to claim damages for breach of duty, or

(b) the company’s right to make an application seeking the grant of equitable relief,

but the provisions of this section shall not be read as having the combined effect of enabling the company to be afforded more compensation for any damage or injury, or more protection of any proprietary right, than is just and equitable in the circumstances.

(6) Where a transaction or arrangement is entered into by a company and a person connected with a director of the company or of its holding company in contravention of section 238 or 239—

(a) that director shall not be liable under subsection (2) (or under any law referred to in subsection (5)) if he or she shows that he or she took all reasonable steps to secure the company’s compliance with section 238 or 239, as the case may be, and

(b) in any case, a person so connected and any such other director as is mentioned in subsection (2) shall not be so liable if he or she shows that, at the time the transaction or arrangement was entered into (or, as the case may be, at the time the particular transaction was entered into in pursuance of the arrangement), he or she did not know the relevant circumstances constituting the contravention.

233. Power of court to grant relief to officers of company

233. (1) This section applies to any proceedings for negligence, default, breach of duty or breach of trust against an officer of a company.

(2) In proceedings to which this section applies the court hearing the proceedings has the power of granting relief provided under subsection (3) if it appears to the court that the officer concerned is or may be liable in respect of the negligence, default, breach of duty or breach of trust (the “wrong concerned”) but that he or she has acted honestly and reasonably and that, having regard to all the circumstances of the case (including those connected with his or her appointment), he or she ought fairly to be excused for the wrong concerned.

(3) The power referred to in subsection (2) is to relieve the officer concerned, either wholly or partly, from his or her liability in respect of the wrong concerned on such terms as the court may think fit.

234. Anticipated claim: similar power of relief as under section 233

234. (1) If an officer of a company has reason to apprehend that any claim will or might be made against him or her in respect of any negligence, default, breach of duty or breach of trust (the “wrong concerned”) he or she may make the following application to the court.

(2) That application is an application to be relieved of liability in respect of the wrong concerned; on the making of such an application the court shall have the same power to relieve the applicant as it would have had (by virtue of section 233) if it had been a court before which proceedings against that person for the wrong concerned had been brought.

235. Any provision exempting officers of company from liability void (subject to exceptions)

235. (1) Subject to the provisions of this section, the following provision shall be void, namely, any provision:

(a) purporting to exempt any officer of a company from; or

(b) purporting to indemnify such an officer against;

any liability which by virtue of any enactment or rule of law would otherwise attach to him or her in respect of any negligence, default, breach of duty or breach of trust of which he or she may be guilty in relation to the company.

(2) Subsection (1) applies whether the provision concerned is contained in the constitution of a company or a contract with a company or otherwise.

(3) Notwithstanding subsection (1), a company may, in pursuance of any such provision as is mentioned in that subsection, indemnify any officer of the company against any liability incurred by him or her—

(a) in defending proceedings, whether civil or criminal, in which judgment is given in his or her favour or in which he or she is acquitted; or

(b) in connection with any proceedings or application referred to in, or under, section 233 or 234 in which relief is granted to him or her by the court.

(4) Notwithstanding subsection (1), a company may purchase and maintain for any of its officers insurance in respect of any liability referred to in that subsection.

(5) Notwithstanding any provision contained in any enactment, the constitution of a company or otherwise, a director may be counted in the quorum and may vote on any resolution to purchase or maintain any insurance under which the director might benefit.

(6) For the avoidance of doubt, if—

(a) any business, trade or activity has been carried on by means of a company, or other body corporate, registered or formed under the laws of another country,

(b) the period for which that business, trade or activity was so carried on was not less than 12 months preceding the date on which this subsection falls to be applied,

(c) a provision of the kind referred to in subsection (1)(a) or (b) in relation to officers of the company or other body corporate was in being and valid under the laws of that country, and

(d) a private company limited by shares is formed and registered to carry on that business, trade or activity,

then nothing in this section invalidates the operation of the provision referred to in paragraph (c) in respect of any negligence, default, breach of duty or breach of trust occurring before that private company limited by shares is formed and registered.

(7) Any directors’ and officers’ insurance purchased or maintained by a company before 6 April 2004 is as valid and effective as it would have been if this section had been in operation when that insurance was purchased or maintained.

(8) In this section—

(a) “officer” includes a statutory auditor,

(b) a reference to an officer includes a reference to any former or current officer of the company.

CHAPTER 3 Evidential provisions with respect to loans, other transactions, etc., between company and directors

236. Loans, etc., by company to directors: evidential provisions

236. (1) In this section “relevant proceedings” means civil proceedings in which it is claimed that a company has made a loan or quasi-loan to—

(a) a director of the company, or

(b) a director of its holding company, or

(2) In relevant proceedings if the terms of the loan or quasi-loan are not in writing then it shall be presumed, until the contrary is proved, that—

(a) the loan or quasi-loan is repayable on demand, and

(b) for any period before repayment of the amount of the loan or quasi-loan (or for any period before repayment of part of that amount) the amount or part has borne interest at the appropriate rate.

(3) In relevant proceedings if the terms of the loan or quasi-loan are in writing or partially in writing but—

(a) the case is one in which those terms are ambiguous with respect to the time at which, or the circumstances under which, the loan or quasi-loan is to be repaid, then it shall be presumed, until the contrary is proved, that the loan or quasi-loan is repayable on demand, or

(b) the case is one in which those terms are ambiguous with respect to whether, or the extent to which, the loan or quasi-loan bears interest, then it shall be presumed, until the contrary is proved, that for any period before repayment of the amount of the loan or quasi-loan (or for any period before repayment of part of that amount) the amount or part has borne interest at the appropriate rate.

(4) If the case referred to in paragraph (a) of subsection (3) and the case referred to in paragraph (b) of that subsection both apply then both of the presumptions provided by that subsection shall apply.

(5) References in subsection (3) to the terms of a loan or quasi-loan being ambiguous with respect to a matter shall, if the terms of the loan or quasi-loan are partially in writing, be deemed to include references to the following case.

(6) That case is one in which—

(a) the written terms of the loan or quasi-loan do not make provision in respect of the matter concerned, and

(b) provision in respect of that matter is alleged to be made by those of the terms of the loan or quasi-loan that are not in writing.

237. Loans, etc., by directors or connected persons to company or holding company: evidential provisions

237. (1) In this section “relevant proceedings” means civil proceedings in which it is claimed that a transaction or arrangement entered into, or alleged to have been entered into—

(a) by a director of a company with the company or its holding company, or

(b) by a person connected with such director with that company or its holding company (the “related person”),

constitutes a loan or quasi-loan by the director or (as appropriate) the related person to that company or its holding company, as the case may be.

(2) In relevant proceedings, if the terms of the transaction or arrangement concerned either—

(a) are not in writing, or

(b) are in writing, or partially in writing, but are ambiguous as to whether the transaction or arrangement constitutes a loan or quasi-loan or not (or as to whether it constitutes a quasi-loan as distinct from a loan),

then it shall be presumed, until the contrary is proved, that the transaction or arrangement constitutes neither a loan nor a quasi-loan to the company or its holding company, as the case may be.

(3) In relevant proceedings, where it is proved that a loan or a quasi-loan was made to the company or its holding company by the director of the first-mentioned company or the related person (whether the terms of the loan or quasi-loan are in writing, partially in writing or wholly oral) then, if—

(a) the case is one in which those terms are ambiguous with respect to whether, or the extent to which, the loan or quasi-loan bears interest, it shall be presumed, until the contrary is proved, that the loan or quasi-loan bears no interest,

(b) the case is one in which those terms are ambiguous with respect to whether, or the extent to which, the loan or quasi-loan is secured, it shall be presumed, until the contrary is proved, that the loan or quasi-loan is not secured, or

(c) in the event that the loan or quasi-loan is proved to be secured and the case is one in which those terms are ambiguous with respect to the priority that the security concerned is to have as against other indebtedness of the company, it shall be presumed, until the contrary is proved, that the loan or quasi-loan is subordinate to all other indebtedness of the company.

(4) If more than one of the cases referred to in paragraphs (a) to (c) of subsection (3) apply then each of the presumptions provided by the applicable paragraphs shall apply.

(5) The reference in subsection (2)(b) to the terms of a transaction or arrangement being ambiguous as to whether the transaction or arrangement constitutes a loan or quasi-loan or not (or as to whether it constitutes a quasi-loan as distinct from a loan) shall, if the terms of the transaction or arrangement are partially in writing, be deemed to include a reference to the following case.

(6) That case is one in which—

(a) the written terms of the transaction or arrangement do not specify what the nature of the transaction or arrangement is, and

(b) the nature of the transaction or arrangement is alleged to be specified by those of its terms that are not in writing.

(7) References in subsection (3) to the terms of a loan or quasi-loan being ambiguous with respect to a matter shall, if the terms of the loan or quasi-loan are partially in writing, be deemed to include references to the following case.

(8) That case is one in which—

(a) the written terms of the loan or quasi-loan do not make provision in respect of the matter concerned, and

(b) provision in respect of that matter is alleged to be made by those of the terms of the loan or quasi-loan that are not in writing.

CHAPTER 4 Substantive prohibitions or restrictions on loans to directors and other particular transactions involving conflict of interest

238. Substantial transactions in respect of non-cash assets and involving directors, etc.

238. (1) Subject to subsections (4) and (5), a company (the “relevant company”) shall not enter into an arrangement under which—

(a) a director of the relevant company or of its holding company, or a person connected with such a director, acquires or is to acquire, one or more non-cash assets of the requisite value from the relevant company, or

(b) the relevant company acquires or is to acquire, one or more non-cash assets of the requisite value from such a director or a person so connected,

unless the arrangement is first approved—

(i) by a resolution of the relevant company in general meeting, and

(ii) if the director or connected person is a director of its holding company or a person connected with such a director, by a resolution of the holding company in general meeting.

(2) For the purposes of this section a non-cash asset is of the requisite value if at the time the arrangement in question is entered into its value is not less than €5,000 but, subject to that, exceeds €65,000 or 10 per cent of the amount of the relevant company’s relevant assets, and for those purposes the amount of a company’s relevant assets is—

(a) except in a case falling within paragraph (b), the value of its net assets determined by reference to the entity financial statements prepared under section 290 and laid in accordance with section 341 in respect of the last preceding financial year in respect of which such entity financial statements were so laid,

(b) where no entity financial statements have been prepared and laid under the foregoing sections before that time, the amount of its called-up share capital.

(3) An arrangement entered into by a company in contravention of this section and any transaction entered into in pursuance of the arrangement (whether by the company or any other person) shall be voidable at the instance of the company unless—

(a) restitution of any money or any other asset which is the subject-matter of the arrangement or transaction is no longer possible or the company has been indemnified in pursuance of section 232 by any other person for the loss or damage suffered by it, or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person who is not a party to the arrangement or transaction would be affected by its avoidance, or

(c) the arrangement is affirmed by a resolution of the company in general meeting passed within a reasonable period of time after the date on which the arrangement is entered into and, if it is an arrangement for the transfer of an asset to or by a director of its holding company or a person who is connected with such a director, is affirmed by a resolution of the holding company in general meeting passed within a reasonable period of time after that date.

(4) Subsection (1) shall not apply in relation to any arrangement for the acquisition of a non-cash asset—

(a) if the non-cash asset in question is or is to be acquired—

(i) by a holding company from any of its wholly owned subsidiaries, or

(ii) from a holding company by any of its wholly owned subsidiaries, or

(iii) by one wholly owned subsidiary of a holding company from another wholly owned subsidiary of that holding company,

(b) if the arrangement is entered into by a company which is being wound up unless the winding up is a members’ voluntary winding up, or

(5) Subsection (1)(a) shall not apply in relation to any arrangement under which a person acquires or is to acquire an asset from a company of which he or she is a member if the arrangement is made with that person in his or her character as such member.

(6) Without prejudice to subsection (7), no approval is required to be given under this section by any body corporate unless it is a company formed and registered under this Act or an existing company.

(7) No approval is required to be given under this section by a wholly owned subsidiary of any body corporate.

(8) In this section—

(a) “non-cash asset” means any property or interest in property other than cash, and for this purpose “cash” includes foreign currency,

(b) any reference to the acquisition of a non-cash asset includes a reference to the creation or extinction of an estate or interest in, or a right over, any property and also a reference to the discharge of any person’s liability other than a liability for a liquidated sum, and

(c) “net assets”, in relation to a company, means the aggregate of the company’s assets less the aggregate of its liabilities, and for this purpose “liabilities” includes—

(i) where the company prepares Companies Act entity financial statements, any provision for liabilities (within the meaning of F106[paragraph 80 of Schedule 3, paragraph 65 of Schedule 3A or paragraph 39 of Schedule 3B, as the case may be]) that is made in those financial statements,

(ii) where the company prepares IFRS entity financial statements, any provision that is made in those financial statements.

239. Prohibition of loans, etc., to directors and connected persons

239. (1) Except as provided by section 240 and sections 242 to 245, a company shall not—

(a) make a loan or a quasi-loan to a director of the company or of its holding company or to a person connected with such a director,

(b) enter into a credit transaction as creditor for such a director or a person so connected,

(c) enter into a guarantee or provide any security in connection with a loan, quasi-loan or credit transaction made by any other person for such a director or a person so connected.

(2) A company shall not arrange for the assignment to it or the assumption by it of any rights, obligations or liabilities under a transaction which, if it had been entered into by the company, would have contravened subsection (1), but, for the purposes of this Part, the transaction shall be treated as having been entered into on the date of the arrangement.

(3) A company shall not take part in any arrangement under which—

(a) another person enters into a transaction which, if it had been entered into by the company, would have contravened subsection (1) or (2), and

(b) that other person, in pursuance of the arrangement, has obtained or is to obtain any benefit from the company or its holding company or a subsidiary of the company or its holding company.

240. Arrangements of certain value

240. (1) Section 239 does not prohibit a company from entering into an arrangement with a director or a person connected with a director (whether, in either case, a director of the company or of its holding company) if—

(a) the value of the arrangement, or

(b) in a case where there are other arrangements entered into by the company with any director of the company, or any person connected with a director, the value of the arrangement and the total amount outstanding under those other arrangements, is, or, as the case may be, is together, less than 10 per cent of the company’s relevant assets.

(2) For the purposes of this section—

(a) a company enters an arrangement with a person if it—

(i) makes a loan or quasi-loan to or enters into a credit transaction as creditor for that person, or

(ii) enters into a guarantee or provides any security in connection with a loan, quasi-loan or credit transaction made for that person by any other person,

(b) the amount of a company’s relevant assets shall be determined in accordance with section 238(2); and

241. Reduction in amount of company’s relevant assets

241. (1) This section applies to a company in respect of which the total amount outstanding under any arrangements referred to in section 240 comes to exceed 10 per cent of the company’s relevant assets for any reason but in particular because the value of those assets has fallen.

(2) The reference in subsection (1) to arrangements referred to in section 240 does not include a reference to any arrangement or arrangements entered into in accordance with the Summary Approval Procedure.

(3) Where the directors of a company to which this section applies become aware, or ought reasonably to become aware, that there exists the situation referred to in subsection (1), it shall be the duty of the company, its directors and any persons for whom the arrangements referred to in that subsection were made, to do the thing referred to in subsection (4) within the period specified in subsection (5).

(4) The thing mentioned in subsection (3) is to amend the terms of the arrangements concerned so that the total amount outstanding under the arrangements again falls within the percentage limit referred to in subsection (1).

(5) The period mentioned in subsection (3) is 2 months after the date that the directors become aware or ought reasonably to have become aware that the situation concerned referred to in subsection (1) exists.

(6) Where the terms of the arrangements referred to in subsection (4) are not amended within the period specified in subsection (5), the arrangements shall be voidable at the instance of the company; but the same restrictions apply to this right of the company to avoid as are contained in paragraphs (a) and (b) of section 246 on the right to avoid under that section.

242. Availability of Summary Approval Procedure to permit loans, etc.

242. Section 239 does not prohibit a company from—

(a) making a loan or quasi-loan,

(b) entering into a credit transaction, or

of the kind described in subsection (1) of that section if the Summary Approval Procedure is followed in respect of the doing of the thing referred to in paragraph (a), (b) or (c), as the case may be.

243. Intra-group transactions

243. (1) Section 239 does not prohibit a company from—

(a) making a loan or quasi-loan to any body corporate which is its holding company, subsidiary or a subsidiary of its holding company, or

(b) entering into a guarantee or providing any security in connection with a loan or quasi-loan made by any person to any body corporate which is its holding company, subsidiary or a subsidiary of its holding company.

(2) Section 239 does not prohibit a company from—

(a) entering into a credit transaction as creditor for any body corporate which is its holding company, subsidiary or a subsidiary of its holding company, or

(b) entering into a guarantee or providing any security in connection with any credit transaction made by any other person for any body corporate which is its holding company, subsidiary or a subsidiary of its holding company.

244. Directors’ expenses

244. (1) Section 239 does not prohibit a company from doing anything—

(a) to provide any of its directors with funds to meet vouched expenditure properly incurred or to be incurred by him or her—

(i) for the purposes of the company, or

(ii) for the purpose of enabling him or her properly to perform his or her duties as an officer of the company,

(b) to enable any of its directors to avoid incurring such expenditure.

(2) Where a company enters into any transaction that is permitted by subsection (1), any liability falling on any person arising from any such transaction shall be discharged by him or her within 6 months after the date on which it was incurred.

(3) A person who contravenes subsection (2) shall be guilty of a category 4 offence.

245. Business transactions

245. (1) Section 239 does not prohibit a company from—

(a) making a loan or quasi-loan,

(b) entering into a credit transaction, or

of the kind described in that section if the following 2 conditions are satisfied.

(2) Those conditions are—

(a) the company enters into the transaction concerned in the ordinary course of its business, and

(b) the value of the transaction is not greater, and the terms on which it is entered into are no more favourable, in respect of the person for whom the transaction is made, than that or those which—

(i) the company ordinarily offers, or

(ii) it is not unreasonable to expect the company to have offered,

to or in respect of a person of the same financial standing as that person but unconnected with the company.

246. Transaction or arrangement in breach of section 239 voidable at instance of company

246. If a company enters into a transaction or arrangement in contravention of section 239 the transaction or arrangement shall be voidable at the instance of the company unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible, or the company has been indemnified in pursuance of section 232 for the loss or damage suffered by it, or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person other than the person for whom the transaction or arrangement was made would be affected by its avoidance.

247. Personal liability for company debts in certain cases

247. (1) If—

(a) a company is being wound up and is unable to pay its debts, and

(b) the court considers that any arrangement of a kind described in section 240(2)(a) has contributed materially to the company’s inability to pay its debts or has substantially impeded the orderly winding up of it,

the court, on the application of the liquidator or any creditor or contributory of the company, may, if it thinks it proper to do so, make the following declaration.

(2) That declaration is a declaration that any person for whose benefit the arrangement was made shall be personally liable, without any limitation of liability, for all or such part as may be specified by the court, of the debts and other liabilities of the company.

(3) In deciding whether to make a declaration under this section, the court shall have particular regard to whether and to what extent, any outstanding liabilities arising under any arrangement referred to in subsection (1) were discharged before the commencement of the winding up.

(4) In deciding the extent of any personal liability under this section, the court shall have particular regard to the extent to which the arrangement in question contributed materially to the company’s inability to pay its debts or substantially impeded the orderly winding up of the company.

248. Offence for contravention of section 239

248. If a company enters into a transaction or arrangement that contravenes section 239, any officer of it who is in default shall be guilty of a category 2 offence.

249. Contracts of employment of directors — control by members over guaranteed periods of employment

249. (1) In this section “relevant term” means a term by which a director’s employment with the company of which he or she is a director or, where he or she is the director of a holding company, his or her employment by any company comprised in the group, is to continue or may be continued, otherwise than at the instance of the company, for a period exceeding 5 years during which the employment—

(a) cannot be terminated by the company by the giving of notice, or

(b) can be so terminated only in specified circumstances.

(2) References in subsection (1) to employment being continued (or its potential to be continued) are references to its being continued (or its potential to be continued) whether under the original agreement concerned or under a new agreement entered into in pursuance of the original agreement concerned.

(3) A company shall not incorporate in any agreement a relevant term unless the term is first approved by a resolution of the company in general meeting and, in the case of a director of a holding company, by a resolution of that company in general meeting.

This document does not substitute the official text published in the Irish Statute Book. We accept no responsibility for any inaccuracies arising from the transcription of the original into this format.

This text is published under Irish Statute Book's own terms of reuse, not a Legalize or public-domain licence. Irish Statute Book
CC-BY 4.0 (Oireachtas Open Data PSI Licence)
Contains Irish Public Sector Information licensed under the Oireachtas (Houses of the Oireachtas) Open Data PSI Licence / Creative Commons Attribution 4.0 International, sourced from https://www.irishstatutebook.ie.