15
Sep
Companies Act 2014 - The Conversion Deadlines are now here.
There has been much commentary over the last number of months in relation to the new Companies Acts and the need to convert the status of your company. The time has now come for the deadlines on conversion so if you have not completed the process already you need to act now.
The new company types under the legislation are as follows -
Any company limited by shares incorporated prior to the 1st of June 2015 must now convert to a new company type.
The two new company types are Private Companies Limited by Shares (LTD) and Designated Activity Companies (DAC). Which format your company chooses depends on the function or activity of your company.
The first type, a LTD company, will have full legal capacity, it need not have an authorised share capital, it can appoint a sole director and it can dispense with the requirement to hold an AGM.
A DAC however must have an objects clause, must have at least two directors and an authorised share capital. As such a DAC is very similar to the previous incarnation of a LTD.
Companies such as banks and credit institutions, insurers, semi-state entities and companies with debentures listed on an exchange must convert to a DAC under the legislation.
For companies wishing to convert to a DAC the deadline to convert by way of ordinary resolution was the 31st of August 2016.
The deadline for conversion to an LTD company is the 30th of November 2016.
All companies that have not converted by 30th of November 2016 will automatically be converted by the CRO to the new LTD form.
Should you do nothing then and allow the automatic conversion to occur? Our advice should be that you should not as companies which have been automatically converted will not be issued with a new constitution. And as such the company’s legal documents will still refer to the obsolete Companies Acts and may contradict current company law.
Also if directors do not act before 30th of November 2016, they are in breach of the obligation set down by Section 60 of the Act. http://www.irishstatutebook.ie/eli/2014/act/38/section/60/enacted/en/html
As such our advice is to act today and get your company status up to date. It is a very simple and inexpensive procedure. Also between now and the deadline we will be offering a special further reduced rate to Charities and Sports Organisations who are classified as CLGs.
Email us today for help in doing so – info@geaneysolicitors.ie