If you are thinking of setting up a Company in Ireland please see below for some of the key points that should be considered;
There are two types of private companies limited by shares in Ireland (Limited’s and DAC’s).
Company Limited by Shares (LTD) is a standard private limited liability Company and the most common Company type for SMEs. This Company type will allow you to avail of the simplest, most streamlined, provisions of Irish Company law.
Designated Activity Company (DAC) is a Company with a two document constitution which requires an objects clause.
Things to think about when deciding between an ‘LTD’ and a ‘DAC’.
When incorporating a new Company, unless there is a specific requirement for one of the other types of Company the decision will usually be whether to incorporate as a LTD or as a DAC.
The LTD, has real positive features which many small businesses should be able to benefit from such as:
- No objects clause, therefore, no restrictions on what it can do.
- The ability to have a sole Director, who is an EEA resident Director, therefore, removing the need to find a second Director just to meet the requirements of the law. In instances where a Company has a sole Director, the position of the Company Secretary must be held by a separate person.
- A single, simple, one document constitution.
- The ability to dispense with the need to have a physical AGM each year, whether a single or multi-member Company, (although a written resolution will be required).
- It is not necessary to have an authorised share capital.
- The Company name would end in “Limited”, this may be a consideration if planning to trade in other jurisdictions where “Designated Activity Company” would not have the same recognition.
If, however, any of the following apply to your Company you should consider, or may be required, to incorporate as a DAC.
- Will this Company perform a designated activity (for example, is it a financial or insurance undertaking)?
- Are you considering putting financial arrangements in place which will restrict your Company activities or require specific provisions in your articles?
- Will your Company be subject to a shareholders’ agreement or in a joint venture arrangement?
- Is there a specific requirement for your Company to have an objects clause?
- Is there a possibility that your Company may wish to list debt in the future?
However a private Company limited by shares may not be the right structure for your business. The other principal Company types under the Act are the Private Unlimited Liability Company having a share capital (ULC); Company Limited by Guarantee without a share capital (CLG) and Public Limited Company (PLC). Contact us for more information on these Company types.
Every Company incorporated in Ireland must have at least one EEA resident Director or provide a “Section 137 Bond” in the prescribed form to the value of €25,000. You should also be aware that you (and your fellow Directors) have obligations and responsibilities under the Companies Act 2014 (“the Act”).
In the event you avail of the single Director option available to limited companies, your Company Secretary cannot be the same person, there must be two statutory officers in the Company.
Under Irish Company law every Company must have a Company Secretary. You must identify a suitable person/entity to carry out the role/functions of the Company Secretary. The Directors of a Company must ensure that the person who is appointed as the Company Secretary has the requisite knowledge, experience, skills or resources (e.g. access to a specialist service provider) to discharge their statutory and other duties as required by the Act. FCS Services can act as a Company Secretary for new businesses or alternatively to provide advice to the Company Secretary as required.
Every Company incorporated in Ireland must carry on an activity in the State and must have a place where that activity can be conducted. You must also consider if that place of activity will be appropriate to serve as the registered office address of the Company. Please note that this registered office address must be a physical location (it cannot be a PO Box) which will need to be registered with the CRO upon incorporation and is the address to which all CRO documentation and/or legal notices will be issued. FCS Services can provide a Registered Office Address for your Company if required.
Check your Company name – while it is relatively simple to change a Company name down the track the expense of having to rebrand, can be a very time consuming and costly process. Also, while you may be very clear now on what your Company name should be, before purchasing any domain names, etc., it is important that you check your Company name is available and will be registered by the CRO (and vice versa re domain names). You should also be aware that there are restrictions within Ireland on the use of certain words in Company names. FCS Services can check or reserve Company names if required.
You should consider whether you need to register a business name. This is obligatory if your Company wishes to carry on business using a name which is not the Company Name. There are restrictions within Ireland on the use of certain words in business names. Registering a business name in Ireland does not give protection against duplication of the name. FCS Services can assist you with the registration of a business name if required.