The Companies (Accounting) Act 2017 has now been signed into law, with a commencement date of 9 June 2017. While the new Act brings about numerous amendments to the Companies Act 2014, some of the key changes relate to unlimited liability companies which we have specifically highlighted here.
Filing Obligations for Irish Unlimited Companies
One key change relates to the obligation of unlimited companies to file financial statements on the public record at the Companies Registration Office ("CRO").
Impact on Irish unlimited companies
In summary, all Irish unlimited companies which have a (direct or indirect) limited liability holding company will now be required to publicly file their annual audited financial statements.
What is the relevant financial period?
It has now been confirmed that the obligation to file will apply in respect of financial periods commencing on or after 1 January 2017.
Impact on Non-Irish Unlimited Companies – Irish Branch Structures
By virtue of the now expanded definition of the term "branch" included in the Act, the change in relation to the public filing of financial statements will also impact non-Irish unlimited companies which have Irish branch operations and a (direct or indirect) limited liability holding company. While such companies were not previously obliged to register as a branch at the CRO, they will now be required to do so and to publicly file the home company's audited financial statements on registration (if available) and on an annual basis thereafter.
Name Change Exemption for Unlimited Companies
The Act also eliminates the ability for Irish unlimited companies to apply for an exemption from the requirement to include the words "unlimited company" at the end of their name. Those companies which successfully received a five year exemption from the name change requirement in 2016 will therefore not be able to apply for a renewal of the exemption in 2021 and will be obliged to change their name to include the words "unlimited company" in advance of that date. Exemptions already granted will not be affected by the change.
Click here for an overview of these and other changes brought about by the new Act, and of course, if you have any questions please get in touch with your usual contact at Matheson.
Other News - Beneficial Ownership Disclosure Regime
In other news, the CRO has issued an update on the proposed centralised beneficial ownership register for Irish companies.
What is the 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. The 2016 regulations introduced measures which provide that most Irish companies are obliged to gather and maintain current and accurate information about their "beneficial owners".
Further regulations are due to be published in relation to the filing of this information at a centralised beneficial ownership register. Under these new regulations, information in respect of the beneficial owners of Irish companies will need to be submitted to the CRO which will establish the register.
What will you be obliged to disclose?
Based on information received from the CRO, it appears that Irish companies will be obliged to disclose the following in respect of their beneficial owner(s):
- forename and surname;
- date of birth;
- residential address;
- a statement of the nature of the interest held by each beneficial owner (eg controlling shareholder);
- a statement of the extent of the interest held by each beneficial owner (eg controller of 26% of share in company); and
- the date on which each natural person was entered in the register as a beneficial owner of the corporate entity.
Where no natural person(s) can be identified as having beneficial ownership of the company, the names of the senior managing officials will be required to be disclosed. In most cases, the "senior managing officials" will be the directors of the Irish company.
When will you be obliged to disclose?
The CRO has indicated that the beneficial ownership register is due to be put in place in Q4 2017. It is expected that, once the register has been put in place, there will be a minimum grace period of three months to allow companies time to make the required filings.
We are individually contacting clients for which we maintain company registers in relation to their obligations under the new regime.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.