Significant Updates to Irish Company Law in December 2024

Significant Updates to Irish Company Law in December 2024

In December 2024, significant updates to Irish company law were announced with the enactment of the Companies (Corporate Governance, Enforcement, and Regulatory Provisions) Act 2024. These changes, intended to modernize and streamline corporate practices, include the permanent legalization of virtual Annual General Meetings (AGMs) and numerous other reforms.

Key Changes to Company Law

Virtual AGMs

Virtual AGMs, which were temporarily permitted during the COVID-19 pandemic, are now permanently allowed under the new legislation. This change provides companies with flexibility to hold shareholder and creditor meetings fully online or in a hybrid format. Companies must ensure the technology used allows real-time participation and voting, with details included in the meeting notice. This measure is expected to benefit over 240,000 companies and 950 cooperatives across Ireland.

Late Filing Penalty Relaxation

For small and micro-companies, the Act introduces a grace period for annual return filings. Companies will retain their audit exemption unless they fail to file on time more than once within five consecutive years. This aims to reduce the administrative burden on smaller firms.

New Grounds for Involuntary Strike-Off

Three additional grounds for involuntary strike-off have been established:

• Failure to notify changes in the company’s registered office.
• Absence of a registered company secretary.
• Failure to submit beneficial ownership information to the Central Register of Beneficial Ownership.

These changes reinforce compliance with statutory obligations and help maintain accurate corporate records.

Additional Reforms

Other notable amendments include:

• Execution of Documents: Documents can now be executed under seal across multiple locations, simplifying the logistical process.
• Shareholder Resolutions and Summary Approval Procedure (SAP): These will require submission in prescribed forms to ensure uniformity.
• Optional Gender Reporting: Companies can choose to disclose board gender balance data in their annual returns, supporting diversity monitoring.
• Enhanced Enforcement Powers: The Corporate Enforcement Authority (CEA) has been granted increased powers, including new criminal offences for obstructing investigations.

Transitional Provisions

The virtual meeting provisions, initially set to expire in December 2024, were extended to allow uninterrupted use until the permanent amendments were enacted. This extension ensures compliance and adaptability for businesses navigating post-pandemic challenges.

Implications

These changes reflect Ireland's commitment to aligning its corporate governance framework with modern business practices and EU standards. By addressing compliance flexibility, enhancing enforcement, and leveraging technology, the Act supports efficiency and accessibility for businesses of all sizes.

This comprehensive overhaul of company law represents a significant milestone in corporate governance, balancing stringent compliance requirements with flexibility for evolving business needs.

Credit

We would like to thank our expert Commercial and Business Law Solicitors Dublin Lavelle Partners LLP for sharing the update on company law in Ireland.