Company Designation and Converting Requirements under the Companies Act 2014
The new companies act 2014 came into law on 01st June 2014. There were many reasons why the companies act was consolidated, but one of the main reasons was to help make Ireland one of the easiest places to do business in the world. Directors of limited companies need to consider their Company Designation and Converting Requirements under the Companies Act 2014.
If private limited companies do not act and wait for the 18 month transition period, then they will automatically be converted to the Designated Activity company (DAC) status. This may not be the best option for Directors as companies may be benefiting of entitlements under the new Private Limited Company with Shares and exposing themselves to compliance issues under the new act.
Converting to the correct designation and company type is just a case of deciding on which of the two types you require.
Old Private Limited by Shares (EPC) company type must choose to convert to one of these two new company types:-
- Designated Activity Company (DAC)
- Private Company Limited by Shares (LTD)
| 1. Designated Activity Company (DAC) |
2. Private Company Limited By Shares (Limited) |
| Minimum of 2 Directors | Minimum of 1 Director |
| Secretary must be separate, cannot be sole Director | Secretary can be one of the Directors |
| 1-149 Shareholders | 1-149 Shareholders |
| Objects clause within Memorandum limits Capacity of the Company. | Has a one page constitution document. |
| Must have Authorised Share Capital | No Authorised share capital requirement |
| Must hold an AGM | Need not hold an AGM |
| Can be an Insurance Undertaking or Credit Institution | Cannot be an Insurance Undertaking or Credit Institution |
Conversion Process (18 month transition period)
This “conversion” procedure affects approximately 85% of Irish registered companies which are currently Private Companies (Limited by Shares). All companies currently registered as the “Private Limited by Shares” company type must choose to convert to one of these two new company types – LTD (Private company limited by shares), or DAC (Designated Activity Company). Existing private companies (limited by shares) (EPCs) on the register do not automatically become LTD companies on 1st June 2015.
Converting during the transition period:
Companies should convert as early as possible. Contact us or visit our Services page to choose conversion.
Conversion to LTD company type.
Conversion to DAC company from Private Limited Company