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Incorporating is one of the best ways a business owner can safeguard his or her personal assets. Most people choose to incorporate solely for this reason, but there are other advantages as well. A corporate structure guarantees an investor more flexibility, more opportunities to raise capital and tax holidays.
The principal governing legislation for all Republic of Ireland companies can be found in the Companies Acts', 1963 to 2005, which although similar to that in Northern Ireland and the United Kingdom, nevertheless is considered to be more restrictive.
As per the prevailing set of rules, an Irish limited company must have a Company Secretary (Companies Act 1963 section 175 (1)) who will perform a variety of tasks crucial to the smooth running of the company, which includes ensuring that the company's statutory obligations are complied with.
For incorporating a resident private limited company in Ireland, Non Irish Residents should pay special attention to Section 43 bond as per which a company ceases to have in place an Irish local director. The bond once issued is effective for two years and is renewable later. Submissions for these bonds are subject to application, status and underwriting approval.
Both start-up and existing businesses face the challenges of changing marketplace conditions, asset protection, and risk management. An Irish limited company could be incorporated within 5 working days.
The principal features of Republic of Ireland companies are,
1. Directors must be individuals and not corporate entities.
2. At least one of the named individual directors must be resident in Ireland. There are no other constraints on non-resident or foreign directors.
3. A company secretary can be either an individual or company and may or may not be resident in the State.
4. All companies must have at least one subscriber/shareholder at the time of incorporation.
5. The company must have a real and substantive presence in Ireland and not merely a local registered office.
6. The company must at the time of incorporation be very specific about its intended objects and complete a NACE Code.
7. Generally ready-made or shelf companies are not available due to the requirement to be specific about a company's intended objects.
8. The Companies Registration Office (CRO) does not offer a same day expedited service as available in the UK and many States in the United States.
9. Irish law demands that all limited companies have an official seal.
10. Any alterations to a company's structure will normally require the payment of a small government duty.
11. Stamp duty is approximately 1%, which is levied upon issued but not nominal share capital.
12. Shares should be denominated in Euros (€'s).
An attorney in the formation country will act as nominee director of the company (to the outside) and transfers all rights and obligations internally to the actual beneficiary (deed of trust). The director does not have any account authority. Only the founder receives a general power of attorney for the company. A tax office in the formation country will act as nominee shareholder (to the outside) of the company and transfers all rights and obligations internally to the actual beneficiary.
To incorporate a private company in the Republic of Ireland, Memorandum and Articles of Association are required. The Form of Memorandum is set out in Table B of the Companies Act, 1963 and it must be divided into paragraphs and numbered consecutively. The Memorandum and Articles must be printed in accordance with the directions. It must be divided into paragraphs and numbered consecutively. Photocopies are not acceptable.
The Memorandum must be completed as follows:
The name of the company must be stated with limited or teoranta as the last word of the name. The objects of the company must be stated. It must state that the liability of the members is limited. It must also indicate the amount of share capital with which the company proposes to be registered and the division thereof into shares of a fixed amount. A subscriber to the Memorandum may not take less than one share.
All subscribers must sign the Memorandum and Articles; their addresses and descriptions (occupations) must be stated and their signatures must be witnessed and dated. The company name may be in English or Irish.
The registered office of a company must be in Ireland and a full address must be given - no P.O. Box numbers are permitted. The place in the State where the activity is to take place must be in Ireland and a full address must be given. The company being incorporated must be set up for a specific activity which must be taking place in Ireland. The place of the central administration of the Company must be given with a full address which does not have to be in Ireland.
Certain words are not permitted without prior permission. The use of the word "bank" requires the written approval of the Central Bank in advance of incorporation. The word "insurance" or cognate words cannot be used unless permission has been received from the Minister. The word "university" cannot be used without the permission of the Department of Education. The words "co-op" or "co-operative" cannot be used unless it is a body incorporated as a co-operative society under the relevant legislation. The word "society" may only be used if permission has been obtained from the Registrar of Societies. If a company is non-profit making or formed for charitable purposes, a licence to omit the word "limited" may be obtained from the Minister.
For a private company with limited liability the word "Limited" or its abbreviation "Ltd" must be used, or in Irish "teoranta" or "teo". For a public company with limited liability the words "public limited company" or their abbreviation "plc" must be used, or in Irish "cuideachta phoiblí teoranta" or "cpt". The abbreviations above may not be used on the company's Memorandum or Articles of Association.
Directors, secretaries and their families, as well as shadow and 'de facto' directors are required to notify the company of any interests they may have or cease to have in the shares or debentures (including options) of the company, its subsidiary, its holding company, or any subsidiary of its holding company. The company must keep a register for these purposes, which register must be kept at the same location as the register of shareholders. The register must be made available for inspection by any person, but a nominal charge may be applied to persons who are not shareholders.
Every company must hold an Annual General Meeting ("AGM") within 18 months of incorporation and at no more than 15 month intervals thereafter provided that an AGM is held in each calendar year no more than nine months after the accounting year end. Single-member companies may dispense with the requirement to hold an AGM under certain circumstances but are still required to file an annual return with their audited accounts.
Share capital will be designated in € unless otherwise requested and must be divided into shares of a particular amount, e.g. €100,000 divided into 100,000 Ordinary Shares of €1 each. Foreign currency share capital is permissible. Public companies must have a minimum issued share capital of €39,000 (or the foreign currency equivalent thereof) to obtain a trading certificate and they may not trade without such certificate. This certificate costs €300. A trading certificate is not required for a private company which converts into a public limited company.
It is permissible for a company to divide its shares into voting and non-voting shares. Bearer shares may be issued by public limited companies but are not permitted in private companies. Stamp duty at a rate of three per cent. of the nominal value of the shares is payable on the issue of such shares.
Irish companies require at least two individuals over the age of 18 to act in the capacity of director with at least one such director being a permanent resident of the country.
GOWEALTHY.COM © 2010
For comments: editor@gowealthy.com
Source: Ukincorp.co.uk
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