It is important to understand the question what is a DAC (Designated Activity Company)? While Private Limited companies are undoubtedly the most popular type of company formation in Ireland.

There are several different company types. It is important to understand which one applies to your company. The DAC represents a more recognizable corporate structure for a private company limited by shares.

The objects clause constrains its operations, and its constitution includes a memorandum and articles of association. However, not all of the simplified governance reforms are applicable to the DAC.

People also call a private company limited by shares a DAC company.. They possess the authority to engage exclusively in activities specified in its constitution (memorandum of association). Similarly, a private company limited by guarantee follows the same principle, wherein it can only undertake acts or activities explicitly stated in its constitution.


Both types of companies, must adhere to certain regulations specified in their constitution. These regulations outline particular objects or articles of association that are distinct from the standard template used for regular LTD company constitutions.

Incorporated Companies

Companies Incorporated for specific or sole purposes, which, for legal reasons, desire to have restricted company powers (e.g., Joint Ventures).

Limited Companies

Existing Limited Companies operating under regulations to trade in specified markets (e.g., Financial Regulation) and Companies that have issued an offering document and listed securities.

Limited by Guarantee Companies

Companies opting for Limited by Guarantee status while also having a share capital. Utilized by certain trustee companies and Special Purpose Vehicle (SPV) Companies. Companies with shareholders strongly preferring incorporation as a DAC (Designated Activity Company).

In Ireland, both LTD and DAC companies must have a minimum of 1 shareholder, but they can have up to 149 shareholders.Both types of companies follow the principle of having limited liability for shareholders, which is based on shares and is restricted to the value of the unpaid share capital they possess.

While a Private Company Limited by Shares (LTD) restricts shareholder control and experiences some limitations due to its straightforward company structure, opting for registration as a Designated Activity Company in Ireland empowers the shareholder(s) with complete control and functionality. In contrast to an LTD, a Designated Activity Company can alter its share capital by convening a meeting with all shareholders and filing the necessary documents with the Companies Registration Office (CRO).

One notable distinction of DAC companies lies in their objects clause within the Constitution (Memorandum and Articles of Association), which defines the scope of their business activities. Consequently, a DAC company can only engage in activities explicitly outlined in its Constitution. Conversely, an LTD company enjoys greater flexibility and can operate across various business functions.

Private Limited Company
  • Only one director required
  • Director and secretary can not be the same person
  • Can trade in any type of legal business
  • AGM’s are not a requirement in Ireland
  • Cannot list debt and securities
  • Name must end in Limited
  • Shareholders can be separate from Directors
Designated Activity Company
  • Minimum of two directors required
  • Director can also be listed as company secretary
  • Requires an object clause
  • AGM is a requirement
  • Can list debts and securities
  • Must list ‘Designated Activity Company’ at the end of the company name
  • There are more compliance requirements with a DAC

Purchase a DAC Company Today!

If you are happy with everything you have just read and are ready to get set up, get in touch with us today! Here at Irish Formations we are dedicated to making sure you get set up conveniently, accurately, and quickly. Our team are experts in the area of company formation and would we happy to answer any questions you may have on any of the above areas and help you decide on either a DAC or LTD.