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Irish Corporate Compliance Update
Welcome to our update on recent Irish corporate compliance developments.
We are working through interesting times, particularly in light of evolving US and European political climates, changes to the international tax landscape and recent Brexit developments. Against this backdrop, we continue to see significant strategic investment in Ireland by international companies and wanted to give you an update on key Irish corporate compliance topics which Irish companies should be focused on.
Please get in touch if you would like to discuss any of the below topics.
Director's Compliance Statement - Next Steps
Last year we saw Irish limited liability companies considering their obligations under Ireland's Directors' Compliance Statement regime for the first time. This regime applies to Irish limited liability companies with a turnover of more than €25 million and a balance sheet (gross assets) total of more than €12.5 million.
For those companies which took steps in 2016 to comply with these requirements, they will be obliged to conduct a review of the company's compliance measures during 2017.
For those companies which now fall within the relevant thresholds for the first time, the directors may need to consider whether the company should prepare a Compliance Policy Statement. Please reach out to your usual contact at Matheson for any assistance or with any queries you may have in relation to the Directors' Compliance Statement obligations.
Changes to Filing Obligations for Unlimited Companies
By way of reminder, draft legislation which, when enacted, will effectively require Irish unlimited liability companies to publicly file their annual audited financial statements, was published in the form of the Companies (Accounting) Bill 2016 (the “Bill”).
In terms of applicable financial reporting periods, it was previously expected that the rule change would come into effect for accounts for financial periods beginning on or after 1 January 2016. However, it is now expected that the first relevant period will be those commencing on 1 January 2017. The Bill was passed by the Irish legislature earlier this week and will be signed into law next week as the Companies (Accounting) Act 2017 (the "Act"), at which point the financial period to which the above rule change will apply will then be known.
Click here for further details set out in our previous update on this development.
Update on Name Change Exemption for Unlimited Companies
The Companies Act 2014 introduced a requirement for Irish unlimited companies to include the words “unlimited company” in their names. A number of unlimited companies have been successful in applying for a five year exemption to this requirement.
The Irish Government introduced an amendment to the Bill in recent weeks to remove the exemption, meaning that those companies which received a five year exemption will not be able to apply for renewal in 2021 and would be obliged to change their company name in advance of that date. Exemptions already granted will not be affected by the change.
LTDs - Time to File Updated Constitution
The conversion deadline for Irish private limited companies to convert to either (i) the new form of private company limited by shares ("LTD"); or (ii) the designated activity company ("DAC") form was 30 November 2016. Those companies which automatically converted to LTDs as of 1 December 2016 without filing a new form of LTD constitution should consider updating their constitutions (to replace the memorandum and articles of association currently publicly filed with the Irish Companies Registration Office ("CRO")) to bring them in line with the Companies Act 2014.
Irish Companies Registration Office - Changes to Electronic Filing Requirements
New procedural changes will shortly come into effect at the CRO in relation to the filing of certain forms. From 1 June 2017 it will be mandatory for Irish registered companies to file the following forms electronically:
- B1 - Annual Return (including financial statements);
- B2 - Changes of Registered Office;
- B10 - Change of Director and / or Secretary, or in their Particulars; and
- B73 - Nomination of a New Annual Return Date.
For many of our clients these new requirements reflect their current filing procedure, whereby we file returns electronically on the company's behalf and the 'wet ink' signature page confirmation is later submitted to the CRO. Therefore, in practical terms, these changes should not lead to any significant impact on our clients' current filing procedures. However, if you have any queries in relation to these new requirements please contact your usual contact at Matheson.
Beneficial Ownership Disclosure Regime
By way of reminder, the Irish Government introduced regulations to partly implement the EU’s Fourth Anti-Money Laundering Directive in November 2016 in the form of the EU (Anti-Money Laundering: Beneficial Ownership of Corporate Entities) Regulations 2016. This means that most Irish companies are obliged to gather and maintain current and accurate information about their “beneficial owners”. Further regulations are expected to be introduced shortly which will effectively assign responsibility to the CRO to maintain a central beneficial ownership register ("BOR"). Under these additional regulations, companies will be required to electronically submit details of beneficial owners via an online portal which is expected to be opened at the end of June 2017 with a three month period then permitted for companies to comply with the disclosure requirement. We will be individually contacting clients for which we maintain company registers in relation to their obligations under the new regime. In the meantime, more information on the new beneficial ownership disclosure regime can be found in our recent update here.