Guarantee Companies

Overview I

Existing companies limited by guarantee were continued in being by the Companies Act, 2014.  During the transitional period of 18 months from 1 June 2015, the provisions of the earlier Companies Act relating to the use of the words “limited” and “teoranta” in their name applied. The new provisions regarding their name applied as and from the end the transitional period, i.e.  1 December 2016,  unless they changed their name to incorporate the new style of name, before that date.

The provisions of the Companies Act applicable to private limited companies apply to companies limited by guarantee, save to the extent that they are dis-applied  or modified.  References to membership by virtue of a shareholding, rights and incidents of membership including the right to vote and to receive a distribution arising from shareholding, are interpreted as making analogous provision in the case of a company limited by guarantee.

A company limited by guarantee may be formed for any lawful purpose by persons subscribing their names to a constitution and complying with the provisions in relation to registration.  It may also be formed, by the re-registration of another type of body corporate, by a merger or by division. A CLG may not be formed and registered, unless it appears to the CRO that, when registered, it will carry on an activity in the State in accordance with its memorandum of association.


Overview II

Some provisions which apply to private limited companies do not apply to companies limited by guarantee. In particular, the following provisions do not apply;

  • provisions regarding shares;
  • allotment of shares;
  • power to convert share to stock;
  • transfer of shares;
  • acquisition of own shares;
  • procedures for declaration and payment of dividend;
  • bonus issues;
  • share qualifications for directors;
  • written majority resolutions;
  • holding of own shares.

Constitution I

The constitution of a company limited by guarantee consists of a memorandum of association and articles of association.  The memorandum of association of a CLG shall state

  • its name;
  • that it is a company limited by guarantee registered under the Companies Act;
  • its objects;
  • that the liability of members is limited;
  • that each member undertakes, if the company is wound up while he is a member or within one year, that he will contribute to the assets of the company, such amount as may be required for payment of its debts, liabilities, costs, charges of winding up, and the adjustment of the rights of other contributories.

The constitution is to be in the format specified in Schedule 10 to the Act or as near to it as circumstances permit.  It is to be printed and contained in a single document in a legible form.  It may be in non-legible form, which may be reproduced in legible form.


Constitution II

It must be signed by each subscriber and one witness who shall attest the signatures. It may be authenticated in another prescribed form. Where the constitution is amended; it must be shown as registered in consequence of the amendment.

The articles of a CLG may contain the regulations.  The Companies Act provides for both mandatory and optional provisions. In so far as the articles of a CLG do not exclude or modify them, the optional provisions in the Companies Act apply. The articles must state the number of members with which the company proposes to be registered. The articles may consist solely of a statement that the provisions of the Companies Act are adopted.

The memorandum and articles of a company limited by guarantee registered prior to the 2014 Act, continue in force save to the extent they are inconsistent with the mandatory provisions of the 2014 Act.


Name I

The name of a CLG must end with the words “Company Limited by Guarantee” or “Cuideachta faoi Theorainn Ráthaíochta.  The words may be abbreviated to clg or ctr, capitalised or not capitalised, with or without full stops.

A CLG which carries on business other than under its registered name must register that other name under the Register of Business Names Act.

It is an offence for a body which is not a CLG, to carry on a trade, business or profession under a name which includes the words “company limited by guarantee”, “cuideachta faoi theorainn ráthaíochta” or the equivalent words “clg”, “ctr” etc.  It is an offence on the part of CLG or any officer in default, to use the name in circumstances which would be reasonably expected to give the impression that it was a CLG, where this impression is likely to be material to any person.


Name II

The Registrar of Companies may exempt the use of the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta”.  The objects of the company must be the promotion of commerce, art, science, education, religion, charity or some other prescribed object.

The constitution must require that its profits are to be applied for the promotion of its objects and must prohibit distributions to members. It must provide that on a winding up, its assets if any, are paid to a body with the same objects.  A statement is required on registration of compliance with this requirement.

Any alteration in the constitution must be notified to the Registrar.  The constitution may not be altered so that it no longer complies with the conditions by which the company benefits from the exemption. The Registrar may direct a change of name requiring that the words “company limited by guarantee” etc., be added.


No Share Capital

A CLG does not have a share capital.  Every provision in its constitution or any resolution, purporting to divide the undertaking into shares or interests, is treated as a provision for share capital. This is so, notwithstanding that the nominal amount or number of such shares is not specified. It is void.

A CLG may not purport to issue shares.  Contravention is an offence on the part of the CLG and any officer in default. Any provision in the memorandum or articles of a CLG or any resolution purporting to give power or right to participate in the divisible profits of the company is void.

A CLG shall neither apply to have securities or interests of them traded or listed nor have securities admitted to trading on any regulated market.


Objects

A CLG has the capacity to do any act stated in its objects in its memorandum of association.The objects are to be stated in the memorandum.  An object includes anything stated in the memorandum as a power to do anything, whether or not the word “power” is used.

The capacity of the CLG extends to doing any act or thing that appears to it to be requisite, advantageous or incidental to, or to facilitate the attainment of that objective. It must not be inconsistent with any enactment.

The validity of an act done by a CLG is not invalidated on the grounds of lack of capacity by reason of anything in its objects.  However, a member may bring proceedings to restrain the doing of an act which would be beyond the CLG’s objects /capacity.  No action shall lie in respect of an act done in fulfillment of a legal obligation arising from a previous act of the CLG.

It remains the duty of the directors to observe the limitations on their powers arising from the CLG’s objects.  Actions which would be beyond the capacity of the directors may be ratified by the CLG by special resolution.

The resolution shall not affect the liability of the directors unless the special resolution specifically relieves them separately.  A party to a transaction with a CLG is not bound to enquire as to whether it is permitted by the CLG’s objects.


Alteration of Objects I

A CLG may by a special resolution alter its memorandum of association by abandoning, restricting or amending any existing object or by adopting a new object.  Notice of the meeting to alter the CLG’s objects must be given to the shareholders and debenture holders who are entitled to object. At least 10 days’ notice shall be given.

10 days’ notice of the meeting is also required if the written resolution procedure is used. Where the CLG is permitted to omit the words “clg” or the Irish equivalent from its name, prior notice of the meeting or written resolution must be given to the CRO.

If an application is made to the court for the alteration to be cancelled, it shall take effect only to the extent approved by the court.  An application may be made by not less than 15% of the CLG’s members or debenture holders having the right to object to an alteration.  The application may not be made by any person who has consented to or voted in favour of the alteration.  The application must be made within 15 days. It may be made on behalf of one or more persons.

On the application, the court may make an order cancelling or varying the alteration on such terms as it sees fit.  It may adjourn the proceedings in order for an arrangement to be entered for the purchase of the shares concerned.


Alteration of Objects II

If a CLG passes a resolution altering its objects and no application is made within 15 days, it shall within 15 days deliver a copy of the amended memorandum of association to the CRO.  When the application is made, it shall forthwith give notice to the CRO and shall also register any order made on foot of the same.

A CLG may amend its constitution by a special resolution in relation to the undertaking by a member to contribute on a winding up.  However, the amount may not be increased without the member’s consent.

The articles of association of a CLG may be altered, added to or amended by special resolution.  Any provision contained in a memorandum of association of a CLG which could lawfully have been contained in its articles may be altered by special resolution.

An application may be made to the court for cancellation.  This provision does not apply where the memorandum itself provides for or prohibits the alteration of the above provisions.  It shall not authorise a variation or abrogation of the special rights of any class of members.


Directors I

A CLG must have at least two directors.  The provisions in respect of sole directors do not apply to it.

A person may be a director of no more than 25 companies limited by guarantee, or 25 companies, one or more of which, is a company limited by guarantee and one or more of which is any other company or body corporate capable of being wound up under the Companies Act.

Unless the Constitution otherwise provides, the following provisions apply to the election of directors.  At the first AGM, all directors are to retire. In every subsequent year, one-third of the directors retire. If the number is not three or a multiple of three, then the number nearest one-third shall retire.  The longer-serving directors retire first.  Where persons have served equal periods, those who retire are determined by lot.


Directors II

A retiring director is eligible for re-election.  The CLG may at a general meeting fill any vacancy.  In default of so doing, the retiring director shall if offering himself for re-election be deemed re-elected unless at the meeting it is expressly resolved not to fill the vacated office or a resolution for the re-election of the director has been put and lost.

Unless and to the extent that the constitution of the CLG otherwise provides, the remuneration of the directors as such as is determined, from time to time, by the CLG in general meeting. A director may be paid all travelling, hotel and other expenses properly incurred in attending meetings of the directors and general meetings and otherwise in connection with the business of the CLG.

The general provisions regarding removal of directors apply to CLGs.


Members

The subscribers to the memorandum of association are the first members of the CLG. Such other persons whom the directors admit to membership; or who are admitted to membership, pursuant to the provisions of the constitution either supplementing or limiting the power of the directors in this regard, are also members.  Their names must be entered in the register of members, in order to be directors.

The articles are to provide the number of members that there are to be.  If it increases the number beyond that contemplated by the articles, particulars are to be delivered to the CRO. The articles may provide for the maximum number of members, subject to the power of the CLG to register an increase.

A Register of members is to be maintained. Members may resign by serving notice to that effect on the directors at the registered office.  The director may require a person to resign by serving notice unless the constitution otherwise provides.  The death or bankruptcy of a person terminates his membership.  In the absence of provision to the contrary in the constitution, every member is to have one vote.

The general provisions regarding the convening of meetings, apply to companies limited by guarantee.A CLG, with two or more members, may not dispense with the holding of an annual general meeting. Members having not less than 10% of the voting rights may require the convening of a meeting.

Proxies may be appointed. Every member and every proxy has a right to one vote.  The member shall be entitled to vote unless money due to the company has not been paid. A member may demand a poll.


Financial Statements

The provisions in respect of financial statements of insurance and credit institutions under the Companies Act are varied to the extent provided by EU Directives.

The requirement for a corporate governance statement and certain modifications of obligations in respect of financial statements apply to CLGs which have debentures admitted to trading on a regulated market.

An audit exemption is available to CLGs which meet certain criteria in the Act.  The 2014 Act amended the earlier legislation under which the audit exemption was not available to companies limited by guarantee, not having a share capital.  There is provision for the requisition of an audit report, by one tenth of the members who may accordingly disapply the audit exemption

The provisions of the Companies Act concerning the filing of abridged financial statements do not apply to a CLG that does not trade for gain.  A CLG which does not so trade, is exempted from filing statements with the CRO.  A special form of auditor’s report is required to be filed unless audit exemptions apply.

Statutory auditors who are of the view that adequate accounting records have not been kept must report this matter to the CRO and the Director of Corporate Enforcement.


Winding Up

Contributories (members) are liable on foot of the guarantee in the constitution, where a company limited by guarantee is wound up.  Every past and present member is liable to contribute to the assets up to a maximum of the amount of their guarantee.

In practice, the amount guaranteed is usually nominal.  No member is liable to contribute if he has ceased to be a member for more than a year.  A past member is not liable to contribute in respect of debts contracted after he has ceased to be a member.

The provisions regarding the public offering of securities, market abuse law, transparency obligations, apply to CLGs, insofar as they apply to companies other than public limited companies.


References and Sources

Primary References

Companies Act 2014 (Irish Statute Book)

Companies Act 2014: An Annotation (2015) Conroy

Law of Companies 4th Ed.  (2016)  Ch.32   Courtney

Keane on Company Law 5th Ed. (2016) Ch.6 Hutchinson

Other Irish Sources

Tables of Origins & Destinations Companies Act 2014 (2016) Bloomsbury

Introduction to Irish Company Law    4th Ed. (2015) Callanan

Bloomsbury’s Guide to the Companies Act 2015      Courtney & Ors

Company Law in Ireland 2nd Ed. (2015) Thuillier

Pre-2014 Legislation Editions

Modern Irish Company Law   2nd Ed. (2001) Ellis

Cases & Materials Company Law 2nd Ed. (1998) Forde

Company Law 4th Ed. (2008)  Forde & Kennedy

Corporations & Partnerships in Ireland (2010) Lynch-Fannon & Cuddihy

Companies Acts 1963-2012   (2012)  MacCann & Courtney

Constitutional Rights of Companies   (2007)  O’Neill

Court Applications Under the Companies Act (2013) Samad

Shorter Guides

Company Law – Nutshell 3rd Ed. (2013) McConville

Questions & Answers on Company Law (2008)        McGrath, N & Murphy

Make That Grade Irish Company Law 5th Ed. (2015) Murphy

Company Law BELR Series (2015)   O’Mahony

UK Sources

Companies Act 2006 (UK) (Legilsation.gov.uk)

Statute books Blackstone’s statutes on company law (OUP)

Gower Principles of Modern Company Law 10th Ed. (2016) P. and S. Worthington

Company Law in Context 2nd Ed. (2012) D Kershaw

Company Law (9th Ed.) OUP (2016) J Lowry and A Dignam

Cases and Materials in Company law 11th Ed (2016) Sealy and Worthington

 

UK Practitioners Services

Tolley’s Company Law Handbook

Gore-Browne on Companies

Palmer’s Company Law


Companies Act

Definitions (Part 18)

1172. In this Part—

“company limited by guarantee” or “CLG” means a company which does not have a share capital and which, as provided under section 1176 (2)(e), has the liability of its members limited by the constitution to such amount as the members may respectively thereby undertake to contribute to the assets of the company in the event of its being wound up;

“constitution” shall be read in accordance with section 1176 (1).


Application of Parts 1 to 14 to CLGs

1173. (1) The provisions of Parts 1 to 14 apply to a CLG except to the extent that they are disapplied or modified by—

(a) this section, or

(b) any other provision of this Part.

(2) For the purposes of that application, section 10 (1) shall have effect as if it read—

“(1) Unless expressly provided otherwise, a reference in Parts 2 to 14 to a company is a reference to a CLG.”.

(3) Any of Parts 1 to 14 that makes provision by reference to—

(a) membership arising by virtue of a shareholding, or

(b) right or incidents of membership, including the right to vote or receive a distribution, arising by virtue of a shareholding,

shall be read, in the case of a CLG, as making such provision in the analogous context in which membership, or rights or incidents of membership, may arise in the case of a CLG.

(4) Subsection (3) is without prejudice to the generality of the application and adaptation of Parts 1 to 14 provided by subsections (1) and (2) or any specific adaptation provided by a subsequent section of this Part.

(5) The provisions of this Act specified in the Table to this section shall not apply to a CLG.

(6) The specification in the foregoing Table of a provision (a “specified provision”) of Parts 1 to 14 also operates to disapply to a CLG any other provision of those Parts (notwithstanding that it is not specified in that Table) that makes consequential, incidental or supplemental provision on, or in relation to, the specified provision.


Table

Subject matter

Provision disapplied

Way of forming a private company limited by shares

Section 17

Company to carry on activity in the State and prohibition of certain activities

Section 18

Form of the constitution

Section 19

Certificate of incorporation to state that company is a private company limited by shares

Section 25 (3)

Provisions as to names of companies

Section 26 (1) to (4)

Trading under a misleading name

Section 27

Capacity of private company limited by shares

Section 38

Conversion of existing private company to private company limited by shares to which Parts 1 to 15 apply

Chapter 6 of Part 2

Power to convert shares into stock, etc.

Section 65

Shares

Section 66

Numbering of shares

Section 67

Allotment of shares and variation in capital

Chapters 3 and 4 of Part 3

Transfer of shares

Chapter 5 of Part 3 (save section 94 in so far as it relates to debentures)

Acquisition of own shares

Chapter 6 of Part 3 (save sections 113 to 116 )

Procedures for declarations, payments, etc., of dividends and other things

Section 124

Supplemental provisions in relation to section 124

Section 125

Bonus issues

Section 126

Directors

Section 128

Share qualifications of directors

Section 136

Director voting on contract, etc., in which director is interested

Section 161 (7)

Holding of any other office or place of profit under the company by a director

Section 162

Majority written resolutions

Section 194

Supplemental provisions in relation to section 194

Section 195

Holding of own shares

Section 320 (1)

Directors’ report as it relates to dividends

Section 326 (1)(d)

Acquisition of shares

Chapter 2 of Part 9

Liability as contributories of past and present members

Section 655


CHAPTER 2

Incorporation and consequential matters

Way of forming a CLG

1174. (1) A CLG may be formed for any lawful purpose by any person or persons subscribing to a constitution and complying with the relevant provisions of—

(a) Chapter 2 of Part 2 , as applied by this Part, and

(b) this Part,

in relation to registration of a CLG.

(2) Without prejudice to the means by which a CLG may be formed under the relevant provisions referred to in subsection (1), a company may be registered as a CLG by means of—

(a) the re-registration or registration as a CLG of a body corporate pursuant to Part 20 or 22 ,

(b) the merger of 2 or more companies pursuant to Chapter 3 of Part 9 , or

(c) the division of a company pursuant to Chapter 4 of Part 9 .

(3) The certificate of incorporation issued under section 25 (1) shall state that the company is a company limited by guarantee.


CLG to carry on activity in the State

1175. A CLG shall not be formed and registered unless it appears to the Registrar that the CLG, when registered, will carry on an activity in the State, being an activity that is mentioned in its memorandum.


The form of a CLG’s constitution

1176. (1) Subject to subsection (3), the constitution of a CLG shall be in the form of a memorandum of association and articles of association which together are referred to in this Part as a “constitution”.

(2) The memorandum of association of a CLG shall state—

(a) its name,

(b) that it is a company limited by guarantee registered under this Part,

(c) its objects,

(d) that the liability of its members is limited, and

(e) that each member undertakes that, if the company is wound up while he or she is a member, or within one year after the date on which he or she ceases to be a member, he or she will contribute to the assets of the company such amount as may be required for—

(i) payment of the debts and liabilities of the company contracted before he or she ceases to be a member,

(ii) payment of the costs, charges and expenses of winding up, and

(iii) adjustment of the rights of contributories among themselves, not exceeding an amount specified in the memorandum.

(3) The constitution of a CLG shall—

(a) be in accordance with the form set out in Schedule 10 or as near thereto as circumstances permit,

(b) be printed in an entire format, that is to say the memorandum and articles shall be contained in the one document, being a document either in legible form or (as long as it is capable of being reproduced in legible form) in non-legible form, and

(c) either—

(i) be signed by each subscriber in the presence of at least one witness who shall attest the signature, or

(ii) be authenticated in the manner referred to in section 888 .

(4) Where, subsequent to the registration of the constitution, an amendment of the memorandum of association is made affecting a matter referred to in subsection (2), that subsection shall be read as requiring the memorandum to state the matter as it stands in consequence of that amendment.


Supplemental provisions in relation to constitution and continuance in force of existing memorandum and articles

1177. (1) This section—

(a) contains provisions as to the articles of a CLG,

(b) provides that, in certain circumstances, a default position shall obtain in relation to the articles of a CLG, and

(c) continues in force the memorandum and articles of a company limited by guarantee registered under the prior Companies Acts.

(2) In this section—

“mandatory provision” means a provision of any of Parts 1 to 14 (as applied by this Part) or of this Part that is not an optional provision;

“optional provision” means a provision of any of Parts 1 to 14 (as applied by this Part) or of this Part that—

(a) contains a statement to the effect, or is governed by provision elsewhere to the effect, that the provision applies save to the extent that the constitution provides otherwise or unless the constitution states otherwise, or

(b) is otherwise of such import.

(3) The articles of a CLG may contain regulations in relation to the CLG.

(4) So far as the articles of a CLG do not exclude or modify an optional provision, that optional provision shall apply in relation to the CLG.

(5) Subject to their compliance with section 1199 (3) (articles must state the number of members with which the company proposes to be registered), articles may otherwise consist solely of a statement to the effect that the provisions of the Companies Act 2014 are adopted and, if the articles contain such a statement, subsection (4) shall apply.

(6) The memorandum and articles of a company limited by guarantee registered before the commencement of this section shall—

(a) save to the extent that they are inconsistent with a mandatory provision, and

(b) in the case of the memorandum, subject to section 1190 (6),

continue in force but may be altered or added to under and in accordance with the conditions under which memorandums or articles, whenever registered, are permitted by this Act to be altered or added to.

(7) References in the provisions of a memorandum or articles so continued in force to any provision of the prior Companies Acts shall be read as references to the corresponding provision of this Act.

(8) To the extent that a company limited by guarantee registered before the commencement of this section was, immediately before that commencement, governed by—

(a) the regulations of Table C in the First Schedule to the Act of 1963, or

(b) the regulations of any Table referred to in section 3(9)(b), (c) or (d) of the Act of 1963,

it shall, after that commencement, continue to be governed by those regulations but—

(i) this is save to the extent that those regulations are inconsistent with a mandatory provision,

(ii) those regulations may be altered or added to under and in accordance with the conditions under which articles, whenever registered, are permitted by this Act to be altered or added to, and

(iii) references in the regulations to any provision of the prior Companies Acts shall be read as references to the corresponding provision of this Act.


Provisions as to names of CLGs

1178. (1) The name of a CLG shall end with one of the following:

— company limited by guarantee;

— cuideachta faoi theorainn ráthaíochta.

(2) The words “company limited by guarantee” may be abbreviated to “c.l.g.” or “clg” (including either such abbreviation in capitalised form) in any usage after the company’s registration by any person including the CLG.

(3) The words “cuideachta faoi theorainn ráthaíochta” may be abbreviated to “c.t.r.” or “ctr” (including either such abbreviation in capitalised form) in any usage after the company’s registration by any person including the CLG.

(4) A CLG carrying on business under a name other than its corporate name shall register in the manner directed by law for the registration of business names but the use of the abbreviations set out in subsection (2) or (3) shall not of itself render such registration necessary.

(5) This section is subject to section 1189 (which makes transitional provision for an existing guarantee company as regards its name).


Trading under a misleading name

1179. (1) Subject to subsection (5), neither a body that is not a CLG nor an individual shall carry on any trade, profession or business under a name which includes, as its last part, the words “company limited by guarantee”, or “cuideachta faoi theorainn ráthaíochta” or abbreviations of those words.

(2) If a body or individual contravenes subsection (1), the body or individual and, in the case of a body, any officer of it who is in default, shall be guilty of a category 3 offence.

(3) A CLG shall not, in the following circumstances, use a name which may reasonably be expected to give the impression that it is any type of a company other than a CLG or that it is any other form of body corporate.

(4) Those circumstances are circumstances in which the fact that it is a CLG is likely to be material to any person.

(5) If a CLG contravenes subsection (3), the CLG and any officer of it who is in default shall be guilty of a category 3 offence.

(6) Subsection (1) shall not apply to any company—

(a) to which Part 21 applies, and

(b) which has provisions in its constitution that would entitle it to rank as a CLG if it had been registered in the State.


Power to dispense with “company limited by guarantee” or Irish equivalent in name of charitable and other companies

1180. (1) A CLG shall, notwithstanding its registration as a company with limited liability, be exempt from the provisions of this Act relating to the use of the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” as part of its name and the publishing of its name, but shall enjoy all the privileges and shall (subject to this section) be subject to all the obligations of a CLG, where—

(a) its objects are the promotion of commerce, art, science, education, religion, charity or any other prescribed object, and

(b) its constitution—

(i) requires its profits (if any) or other income to be applied to the promotion of its objects,

(ii) prohibits the making of distributions to its members, and

(iii) requires all the assets which would otherwise be available to its members to be transferred on its winding up to another company whose objects comply with paragraph (a) and which meets the requirements of this paragraph,

and

(c) a director or secretary of the company (or, in the case of an association about to be formed as a limited company, one of the persons who are to be the first directors or the person who is to be the first secretary of the company) has delivered to the Registrar a statement in the prescribed form that the company complies or, where applicable, will comply with the requirements of paragraphs (a) and (b).

(2) The Registrar shall refuse to register as a CLG any association about to be formed as a CLG by a name which does not include the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” unless a statement, as provided for under subsection (1)(c), has been delivered to the Registrar.

(3) An application by a company registered as a CLG for a change of name, being a change that includes or consists of the omission of the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta”, shall be made in accordance with section 30 and the Registrar shall refuse to accede to the application unless a statement, as provided for under subsection (1)(c), has been delivered to the Registrar.

(4) A CLG which is exempt under subsection (1) and which is permitted to omit the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” from its name shall not alter its constitution so that it ceases to comply with the requirements of that subsection.

(5) If it appears to the Registrar that a CLG which is registered under a name not including the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta”—

(a) has carried on any business other than the promotion of any of the objects mentioned in subsection (1)(a),

(b) has applied any of its profits or other income otherwise than in promoting such objects, or

(c) has made a distribution to any of its members,

the Registrar may, in writing, direct the CLG to change its name within such period as may be specified in the direction so that its name ends with the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta”, and the change of name shall be made in accordance with section 30 .

(6) A CLG which has received a direction under subsection (5) shall not thereafter be registered by a name which does not include the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” without the approval of the Registrar.

(7) A person who—

(a) alters the constitution of a CLG in contravention of subsection (4), or

(b) fails to comply with a direction from the Registrar under subsection (5),

shall be guilty of a category 3 offence.

(8) Subsections (9) to (12) have effect notwithstanding—

(a) the repeal by the Act of 2001 of section 24, as originally enacted, of the Act of 1963 (the “original section 24”), or

(b) the repeal by this Act of section 24, inserted by section 88(1) of the Act of 2001, of the Act of 1963 (the “substituted section 24”) or of the Act of 2001.

(9) A licence that—

(a) had been granted by the Minister pursuant to subsection (1) or (2) of the original section 24 to a company limited by guarantee, and

(b) is in force immediately before the commencement of this section,

shall, on and from whichever thing referred to in section 1190 (5)(a) or (b) happens first, continue to have effect but with the modification that it shall operate to exempt the company from the use of the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” as part of its name and the publishing of its name.

(10) Subsections (4) to (7) of the original section 24 shall continue in force in relation to the foregoing licence as if that section 24 had never been repealed, except that references in those subsections to the Minister, wherever occurring, shall be read as references to the Registrar.

(11) An exemption that immediately before the repeal of the Act of 2001 operated, by virtue of the substituted section 24, in favour of a company limited by guarantee shall, on and from whichever thing referred to in section 1190 (5)(a) or (b) happens first, continue to have effect but—

(a) with the modification that it shall operate to exempt the company from the use of the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” as part of its name and the publishing of its name; and

(b) subject to subsection (12).

(12) Subsections (4) to (7) shall, with the necessary modifications, apply to a foregoing exemption as they apply to an exemption under subsection (1).

(13) Subsections (9) to (12) are without prejudice to section 1190 (4) (which saves for a limited period the effect of provisions of the prior Companies Acts (including section 88(2) of the Act of 2001) that impose a requirement, or confer an exemption from a requirement, with regard to the use of “limited” or “teoranta” or their abbreviations).

(14) In relation to—

(a) a CLG that avails itself of the exemption under subsection (1) or continues to avail itself of a licence or exemption referred to in subsection (9) or (11), and

(b) an existing guarantee company (within the meaning of section 1189 ) that avails itself, during the period specified in section 1190 (4), of an exemption conferred by a provision of the prior Companies Acts with regard to the use of “limited” or “teoranta” or their abbreviations,

section 151 shall have effect as if, in addition to the particulars specified in subsection (2)(a) to (c) of that section to be included on all business letters and order forms of the CLG, there were specified in that subsection the fact of the CLG being a limited company.

(15) In this section “Act of 2001” means the Company Law Enforcement Act 2001 .


Prohibition on certain provisions in constitution, etc. and issuing of shares

1181. (1) Any provision in the memorandum or articles of a CLG, or in any resolution of a CLG, purporting to give any person a right to participate in the divisible profits of the company, otherwise than as a member, shall be void.

(2) Nothing in subsection (1) invalidates any distribution by a company limited by guarantee registered before 1 January 1901, on foot of a provision or resolution referred to in that subsection, if the distribution was made before the commencement of this section.

(3) For the purposes of the provisions of this Part stipulating that a characteristic of a CLG is that it does not have a share capital and of this section, the following has effect—

(a) every provision in the constitution, or in any resolution, of a CLG purporting to divide the undertaking of the CLG into shares or interests, shall be treated as a provision for a share capital, notwithstanding that the nominal amount or number of the shares or interests is not specified thereby, and

(b) every such provision or resolution shall be void. (4) A CLG shall not purport to issue shares.

(5) If a CLG contravenes subsection (4), the CLG and any officer of it who is in default shall be guilty of a category 3 offence.


Capacity of a CLG

1182. (1) A CLG shall have the capacity to do any act or thing stated in the objects set out in its memorandum.

(2) For the purposes of subsection (1)—

(a) the reference in it to an object includes a reference to anything stated in the memorandum as being a power to do any act or thing (whether the word “power” is used or not),

(b) if an object is stated in the CLG’s memorandum without the following also being stated in relation to it, the capacity of the CLG extends to doing any act or thing that appears to it to be requisite, advantageous or incidental to, or to facilitate, the attainment of that object and that is not inconsistent with any enactment,

and a subsequent reference in this Part to an object of a CLG shall be read accordingly.


Capacity not limited by a CLG’s constitution

1183. (1) The validity of an act done by a CLG shall not be called into question on the ground of lack of capacity by reason of anything contained in the CLG’s objects.

(2) A member of a CLG may bring proceedings to restrain the doing of an act which, but for subsection (1), would be beyond the CLG’s capacity but no such proceedings shall lie in respect of any act to be done in fulfilment of a legal obligation arising from a previous act of the CLG.

(3) Notwithstanding the enactment of subsection (1), it remains the duty of the directors to observe any limitations on their powers flowing from the CLG’s objects and action by the directors which, but for subsection (1), would be beyond the CLG’s capacity may only be ratified by the CLG by special resolution.

(4) A resolution ratifying such action shall not affect any liability incurred by the directors or any other person; if relief from any such liability is to be conferred by the CLG it must be agreed to separately by a special resolution of it.

(5) A party to a transaction with a CLG is not bound to enquire as to whether it is permitted by the CLG’s objects.


Alteration of objects clause by special resolution

1184. (1) Subject to subsection (2), a CLG may, by special resolution, alter the provisions of its memorandum of association by abandoning, restricting or amending any existing object or by adopting a new object and any alteration so made shall be as valid as if originally contained therein, and be subject to alteration in like manner.

(2) If an application is made to the court in accordance with this section for the alteration to be cancelled, it shall not have effect except in so far as it is confirmed by the court.

(3) Subject to subsection (4), an application under this section may be made—

(a) by not less than 15 per cent of the CLG’s members, or

(b) by the holders of not less than 15 per cent of the CLG’s debentures, entitling the holders to object to alterations of its objects.

(4) An application shall not be made under this section by any person who has consented to or voted in favour of the alteration.

(5) An application under this section shall be made within 21 days after the date on which the resolution altering the CLG’s objects was passed and may be made on behalf of the persons entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(6) On an application under this section, the court may—

(a) make an order cancelling the alteration or confirming the alteration, either wholly or in part, and on such terms and conditions as it thinks fit, and

(b) if it thinks fit, adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissenting members and may give such directions and make such orders as it may think expedient for facilitating or carrying into effect any such arrangement.


Supplemental provisions in relation to section 1184

1185. (1) Where an order under section 1184 requires the CLG not to make any, or any specified, alteration in its constitution, then, notwithstanding anything in this Act, but subject to the provisions of the order, the CLG shall not have power, without the leave of the court, to make any such alteration in contravention of that requirement.

(2) Any alteration in the constitution of a CLG made by virtue of an order under section 1184 , other than one made by resolution of the CLG, shall be of the same effect as if duly made by resolution of the CLG and the provisions of this Act shall apply to the constitution as so altered accordingly.

(3) Notice of the meeting at which the special resolution altering a CLG’s objects is intended to be proposed shall be given to any holders of the CLG’s debentures that entitle the holders to object to alterations of its objects; that notice shall be the same as that given to members of the CLG, so however that not less than 10 days’ notice shall be given to the holders of any such debentures.

(4) If the written resolution procedure is used in the matter, notice, which shall not be less than 10 days, of the proposed use of that procedure shall, together with a copy of the proposed text of the resolution, be given to the debenture holders referred to in subsection (3).

(5) In default of any provisions in the CLG’s constitution regulating the giving to the foregoing debenture holders of notice referred to in subsection (3) or (4), the provisions of Part 4 or, as the case may be, of the CLG’s constitution regulating the giving of notice to members shall apply.

(6) Without prejudice to subsections (3) and (4), in the case of a CLG which is, by virtue of section 1180 , permitted to omit the words “company limited by guarantee” or “cuideachta faoi theorainn ráthaíochta” from its name, notice of—

(a) the meeting at which the special resolution altering a CLG’s objects is intended to be proposed; or

(b) if the written resolution procedure is used in the matter, notice of the proposed use of that procedure, together with a copy of the proposed text of the resolution,

shall be given to the Registrar and subsections (3) to (5) shall apply as respects such notice as they apply as respects notice of the meeting or resolution to debenture holders.

(7) Where a CLG passes a resolution altering its objects—

(a) if no application is made under section 1184 with respect to the alteration, it shall, within 15 days after the end of the period for making such an application, deliver to the Registrar a copy of its memorandum of association as altered, and

(b) if such an application is made, it shall—

(i) forthwith give notice of that fact to the Registrar, and

(ii) within 15 days after the date of any order cancelling or confirming the alteration, deliver to the Registrar a certified copy of the order and, in the case of an order confirming the alteration, a copy of the memorandum as altered.

(8) The court may by order at any time extend the time for delivery of documents to the Registrar under subsection (7)(b) for such period as the court may think proper.

(9) If a CLG makes default in giving notice or delivering any document to the Registrar as required by subsection (7), the CLG and any officer of it who is in default shall be guilty of a category 4 offence.


Restriction of section 32 (1) in relation to CLGs

1186. (1) Other than in respect of making an amendment of the type specified in subsection (2), section 32 (1) shall not apply in relation to a CLG.

(2) The amendment referred to in subsection (1) is an amendment of the amount referred to in section 1176 (2)(e) that is specified in the CLG’s memorandum.


Alteration of articles by special resolution

1187. (1) Subject to the provisions of this Act and to the conditions contained in its memorandum, a CLG may, by special resolution, alter or add to its articles.

(2) Any alteration or addition so made in the articles shall, subject to the provisions of this Act, be as valid as if originally contained therein and be subject in like manner to alteration by special resolution.


Power to alter provisions in memorandum which could have been contained in articles

1188. (1) Subject to subsection (2), sections 32 (4) and (5) and 212 , any provision contained in a CLG’s memorandum which could lawfully have been contained in articles instead of in the memorandum may, subject to the provisions of this section, be altered by the CLG by special resolution.

(2) If an application is made to the court for the alteration to be cancelled, it shall not have effect except in so far as it is confirmed by the court.

(3) This section shall not apply where the memorandum itself provides for or prohibits the alteration of all or any of the foregoing provisions, and shall not authorise any variation or abrogation of the special rights of any class of members.

(4) section 1184 (3) to (6) (other than subsection (3)(b)) and section 1185 (other than subsections (3) to (6)) shall apply in relation to any alteration and to any application made under this section as they apply in relation to alterations and to applications made under those sections.


Status of existing guarantee company

1189. (1) In this section “existing guarantee company” means a company limited by guarantee, and not having a share capital, which—

(a) was incorporated under any former enactment relating to companies (within the meaning of section 5 ), and

(b) is in existence immediately before the commencement of this section.

(2) An existing guarantee company shall, on and from the commencement of this section, continue in existence and be deemed to be a CLG to which this Part applies.

(3) Section 1190 contains provisions—

(a) for enabling such a company to continue to use, for a limited period, “limited” or “teoranta” in its name despite the foregoing status that it has assumed, and

(b) subject to certain exceptions, deeming the name of such a company, after a specified period and in default of its having changed its name in that fashion, to be altered by the replacement of—

(i) “company limited by guarantee” for “limited” at the end thereof, or

(ii) “cuideachta faoi theorainn ráthaíochta” for “teoranta” at the end thereof, as the case may be.

(4) Reference, express or implied, in this Act to the date of registration of a company mentioned in a preceding subsection shall be read as a reference to the date on which the company was registered under the Joint Stock Companies Act 1862, the Companies (Consolidation) Act 1908 or the prior Companies Acts, as the case may be.


Transitional provision — use of “limited” or “teoranta” by existing guarantee company

1190. (1) In this section—

“existing guarantee company” has the same meaning as it has in section 1189 ;

“new provisions” means the provisions of this Part (and the relevant provisions of Part 2 as applied by this Part) relating to the use of either of the required sets of words (or their abbreviations) set out in subsection (2);

“transition period” means the period of 18 months beginning after the commencement of this section.

(2) For the purposes of this section, each of the following is a required set of words—

(a) company limited by guarantee,

(b) cuideachta faoi theorainn ráthaíochta.

(3) The reference—

(a) in the preceding definition of “new provisions”, and

(b) in subsection (4),

to provisions relating to the use of any words includes a reference to provisions conferring an exemption from the use of those words.

(4) During—

(a) the transition period, or

(b) if before the expiry of that period the company has changed its name to include either of the required sets of words, the period preceding the making of that change,

the provisions of the prior Companies Acts relating to the use of limited or teoranta (or their abbreviations) shall apply as respects the name of an existing guarantee company in place of the new provisions.

(5) On and from—

(a) the expiry of the transition period, or

(b) the company changing its name to include either of the required sets of words,

whichever happens first, the new provisions shall apply as respects the name of an existing guarantee company.

(6) Without prejudice to the generality of subsection (5) and subject, where appropriate, to section 1180 (9) to (12), on the expiry of the transition period (and the company has not changed its name before then to include either of the required sets of words), the name of an existing guarantee company, as set out in its memorandum, shall be deemed to be altered by the replacement of—

(a) “company limited by guarantee” for “limited” at the end thereof, or

(b) “cuideachta faoi theorainn ráthaíochta” for “teoranta” at the end thereof,

as the case may be.

(7) Where an existing guarantee company’s name, as set out in its memorandum, is altered by virtue of subsection (6), the Registrar shall issue to the company a fresh certificate of incorporation in respect of it, being a certificate of incorporation that is altered to meet the circumstances of the case.


CHAPTER 3

Share capital

Limitation on offers by CLGs of securities to the public

1191. Section 68 shall apply to a CLG as if the following subsection were substituted for subsection (2):

“(2) A company shall—

(a) neither apply to have securities (or interests in them) admitted to trading or to be listed on, nor

(b) have securities (or interests in them) admitted to trading or listed on,

any market, whether a regulated market or not, in the State or elsewhere; however nothing in this subsection prohibits the admission to trading or listing (or an application being made therefor) on any market of debentures (or interests in them) for the purposes of any of paragraphs (a) to (e) of subsection (3).”.


Application of section 114 in relation to CLGs

1192. In its application to this Part, section 114 shall apply as if each reference in it to the acquisition and holding of shares in a company included, in a case where the holding company is a CLG, a reference to becoming, and being, a member of the company otherwise than by means of acquiring and holding shares.


Uncertificated transfer of securities

1193. Sections 1085 to 1087 shall apply to securities of a CLG as they apply to securities of a PLC.


CHAPTER 4

Corporate governance

Directors

1194. (1) A CLG shall have at least 2 directors.

(2) Nothing in Parts 1 to 14 that makes provision in the case of a company having a sole director shall apply to a CLG.


Limitation on number of directorships

1195. For the purposes of this Part, section 142 shall apply as if the following subsection were substituted for subsection (1):

“(1) A person shall not, at a particular time, be a director of more than—

(a) 25 companies limited by guarantee, or

(b) 25 companies, one, or more than one, of which is a company limited by guarantee and one, or more than one, of which is any other type of company capable of being wound up under this Act.”.


Rotation of directors

1196. (1) Each provision of this section applies save to the extent that the CLG’s constitution provides otherwise.

(2) At the first annual general meeting of the CLG all the directors shall retire from office.

(3) At the annual general meeting in every subsequent year, one-third of the directors for the time being, or, if their number is not 3 or a multiple of 3, then the number nearest one-third shall retire from office.

(4) The directors to retire in every year shall be those who have been longest in office since their last election but as between persons who became directors on the same day, those to retire shall (unless they otherwise agree among themselves) be determined by lot.

(5) A retiring director shall be eligible for re-election.

(6) The CLG, at the meeting at which a director retires in any of the foregoing instances, may fill the vacated office by electing a person to it.

(7) In default of the CLG doing so, the retiring director shall, if offering himself or herself for re-election, be deemed to have been re-elected, unless—

(a) at such meeting it is expressly resolved not to fill such vacated office, or

(b) a resolution for the re-election of such director has been put to the meeting and lost.


Remuneration of directors

1197. (1) Each provision of this section applies save to the extent that the CLG’s constitution provides otherwise.

(2) The remuneration of the directors of a CLG shall be such as is determined, from time to time, by the CLG in general meeting and such remuneration shall be deemed to accrue from day to day.

(3) The directors of a CLG may also be paid all travelling, hotel and other expenses properly incurred by them—

(a) in attending and returning from—

(i) meetings of the directors or any committee referred to in section 160 (9), or

(ii) general meetings of the CLG,

or

(b) otherwise in connection with the business of the CLG.


Removal of directors

1198. Section 146 shall apply to a CLG with the omission of subsection (2) (exclusion of section’s application to a director holding office for life).


Membership

1199. (1) The subscribers to the memorandum of association of a CLG shall be deemed to have agreed to become members of the CLG, and, on its registration, shall be entered as members in its register of members.

(2) Such other persons—

(a) being persons—

(i) whom the directors admit to membership; or

(ii) who are admitted to membership, pursuant to provisions that the constitution may contain in that behalf, whether provisions that—

(I) provide a separate power to; or

(II) supplement or limit, or exclude,

any power of the directors in that regard;

and

(b) whose names are entered in its register of members,

shall be members of the CLG.

(3) The articles of a CLG shall state the number of members with which the company proposes to be registered.

(4) Where a CLG has increased the number of its members beyond the registered number, it shall, within 15 days after the date on which the increase was resolved on or took place, deliver particulars of the increase to the Registrar.

(5) If default is made by a CLG in complying with subsection (4), the CLG and any officer of it who is in default shall be guilty of a category 4 offence.

(6) The articles of a CLG may state the maximum number of persons who may be members of the CLG, subject to the power of the directors to register an increase in the number of members.

(7) A member may resign his or her membership by serving notice to that effect upon the directors at the registered office of the CLG, such notice to expire no earlier than the date of service of the notice of resignation.

(8) Save where the constitution of a CLG provides otherwise, the directors may require a member to resign his or her membership by serving notice upon the member terminating his or her membership to expire no earlier than the date of service of the notice of termination.

(9) Save where the constitution of a CLG provides otherwise, every member shall have one vote.

(10) The death or bankruptcy of a member shall terminate his or her membership.


Personation of member: offence

1200. If any person falsely and deceitfully personates any member of a CLG and thereby—

(a) receives or endeavours to receive any money due to any such member, or

(b) votes at any meeting as if the person were the true and lawful member,

he or she shall be guilty of a category 2 offence.


Register of members

1201. Section 169 shall apply to a CLG with the following modifications:

(a) the following paragraph shall be substituted, in subsection (1), for paragraph (a):

“(a) the names and addresses of the members;”;

and

(b) subsection (5) shall be omitted.


CLG, with 2 or more members, may not dispense with holding of a.g.m.

1202. Section 175 (3) and (4) (which relate to dispensing with the holding of an annual general meeting) shall not apply to a CLG if it has more than one member.


Convening of extraordinary general meeting on requisition

1203. Section 178 shall apply to a CLG with the following modifications:

(a) subsections (1)(a) and (2) shall be omitted; and

(b) the following subsection shall be substituted for subsection (3):

“(3) The directors of a company shall, on the requisition of one or more members holding, or together holding, at the date of the deposit of the requisition, not less than 10 per cent of the total voting rights of all the members having, at the date of the deposit, the right to vote at general meetings of the company, forthwith proceed duly to convene an extraordinary general meeting of the company.”.


Persons entitled to notice of general meetings

1204. Section 180 shall apply to a CLG with the omission of subsection (1)(b) and (c) and subsections (2) to (4).


Proxies

1205. Section 183 shall apply to a CLG with the following modifications:

(a) in subsection (1) there shall be inserted “and save to the extent that the constitution provides otherwise” after “Subject to subsection (3)”;

(b) in subsection (8), the words “or the transfer of the share in respect of which the proxy is given” shall be omitted; and

(c) in subsection (9), there shall be substituted “such death, insanity or revocation” for “such death, insanity, revocation or transfer”.


Votes of members

1206. Section 188 shall apply to a CLG with the following modifications:

(a) the following subsection shall be substituted for subsection (2):

“(2) Where a matter is being decided (whether on a show of hands or on a poll), every member present in person and every proxy shall have one vote, but so that no individual member shall have more than one vote.”;

(b) subsection (3) shall be omitted; and

(c) the following subsection shall be substituted for subsection (6):

“(6) No member shall be entitled to vote at any general meeting of a company unless all moneys immediately payable by him or her to the company have been paid.”.


Right to demand a poll

1207. Section 189 shall apply to a CLG with the omission of subsection (2)(d).


Application of section 193 in relation to a CLG

1208. Section 193 shall apply to a CLG as if, in subsection (1), after “Notwithstanding any provision to the contrary in this Act”, there were inserted “and unless the constitution provides otherwise”.


Application of section 198 in relation to a CLG

1209. Section 198 shall apply to a CLG with the following modifications:

(a) the following paragraph shall be substituted for paragraph (c) of subsection (4):

“(c) resolutions or agreements which have been agreed to by all the members of some class of membership but which if not so agreed to, would not have been effective for their purpose unless they had been passed by some particular majority or otherwise in some particular manner, and all resolutions or agreements which effectively bind all the members of any class of membership though not agreed to by all those members;”;

and

(b) paragraphs (d) and (e) and (g) to (k) of subsection (4) shall be omitted.


Application of Chapter 5 of Part 5 to a CLG

1210. (1) Subject to subsection (2), Chapter 5 of Part 5 shall apply to a CLG.

(2) For the purposes of that application, Chapter 5 of Part 5 shall operate, so far as it relates to shares in a company, or shares in a body corporate of the same group as that company belongs to, as if it excluded references to—

(a) that company where that company is a CLG, and

(b) such a body corporate where that body corporate is a CLG.


CHAPTER 5

Financial statements, annual return and audit

Non-application of Part 6 to CLGs that are credit institutions or insurance undertakings

1211. Part 6 shall not apply to a CLG that is a credit institution or an insurance undertaking—

(a) to the extent provided by regulations made under section 3 of the European Communities Act 1972 to give effect to Community acts on accounts of credit institutions and insurance undertakings, respectively, or

(b) to the extent provided by any other enactment.


Requirement for corporate governance statement and modification of certain provisions of Parts 5 and 6 as they apply to CLGs

1212. Chapter 3 of Part 23 has effect in relation to, amongst other companies, a CLG that has debentures admitted to trading on a regulated market in an EEA state.


Modification of definition of “IAS Regulation” in the case of CLGs

1213. Section 1116 (modification of definition of “IAS Regulation”) shall apply in the case of a CLG as it applies in the case of PLC.


Application of section 297 to a CLG

1214. Section 297 shall apply to a CLG as if the following paragraph were substituted for paragraph (a) of subsection (8):

“(a) any debentures or other debt securities of the company or any shares, debentures or other debt securities of a subsidiary undertaking have been admitted to trading on a regulated market in an EEA state; or”.


Disclosures by CLG that is credit institution

1215. In addition to its having effect in relation to a public limited company, section 1120 shall have effect in relation to a CLG.


Disclosure of membership changes in CLG’s financial statements

1216. Section 318 (details of authorised share capital, allotted share capital and movements) shall not apply in relation to the financial statements of a CLG but where there are changes in the interests of members of a CLG in the financial year to which the financial statements of the CLG relate then particulars of those changes shall be given in the notes to those financial statements.


Disapplication of sections 325(1)(c) and 329 to a CLG

1217. Sections 325 (1)(c) and 329 shall not apply to a CLG.


Application of sections 334, 359 and 362 to a CLG

1218. (1) Section 334 shall apply to a CLG with the following modifications:

(a) the following subsection shall be substituted for subsection (1):

“(1) Any member of a company may serve a notice in writing on the company stating that that member does not wish the audit exemption to be available to the company in a financial year specified in the notice.”;

(b) subsection (3) shall be omitted; and

(c) the following subsection shall be substituted for subsection (4):

“(4) For the avoidance of doubt, the reference in subsection (1) to the member’s not wishing the audit exemption to be available to the company in a specified financial year is, if the company is a subsidiary undertaking, a reference to the member’s not wishing the audit exemption to be available to the subsidiary undertaking irrespective of whether its holding company and any other undertakings in the group avail themselves of the audit exemption in that year.”.

(2) Section 350 (11)(b) shall apply to a CLG as if the words “(in so far as applicable to a private company limited by shares)” were omitted.

(3) Section 362 shall apply to a CLG as if the words “(in so far as applicable to a private company limited by shares)”, in each place where they occur, were omitted and the cases specified in that section in which the audit exemption, as referred to in section 358 or 359 , as the case may be, is not available to a company, or a holding company and its subsidiary undertakings, included a case in which the company or holding company, as appropriate, is a credit institution or an insurance undertaking.


Qualification of section 338 in the case of a CLG

1219. Section 338 (circulation of statutory financial statements) shall apply to a CLG with the following modifications:

(a) in subsection (1)(a), there shall be substituted “(but only if that person is entitled to receive notices of general meetings of the company)” for “(whether that person is or is not entitled to receive notices of general meetings of the company)”; and

(b) in subsection (1)(b), there shall be substituted “(but only if that person is so entitled)” for “(whether that person is or is not so entitled)”.


Exemption from filing with Registrar financial statements, etc.

1220. (1) Without prejudice to subsections (4) to (6) (which contain transitional provisions), sections 347 and 348 shall not apply to a CLG if it satisfies the following conditions:

(a) it has been formed for charitable purposes; and

(b) it stands exempted from those sections by an order made by the relevant authority (which order the relevant authority is, by virtue of this section, empowered to make),

and the exemption provided by that order may, as the relevant authority considers appropriate, be either for an indefinite or a limited period.

(2) The following provisions have effect in relation to a CLG referred to in subsection (1)—

(a) unless the CLG is entitled to and has availed itself of the audit exemption conferred by Chapter 15 or 16 of Part 6 , the statutory auditors of the CLG shall prepare a separate report to the directors which—

(i) confirms that they audited the relevant statutory financial statements for the relevant financial year, and

(ii) includes within it the report made to the members of the CLG pursuant to section 391 ,

and

(b) a copy of the report prepared under paragraph (a) shall be annexed to the annual return delivered by the CLG to the Registrar.

(3) The reference in subsection (2) to a copy of the report prepared under paragraph (a) of it is a reference to a copy that satisfies the following conditions:

(a) it is a true copy of the original save for the difference that the signature or signatures on the original, and any date or dates thereon, shall appear in typeset form on the copy; and

b) it is accompanied by a certificate of a director and the secretary of the company, that bears the signature of the director and the secretary in electronic or written form, stating that the copy is a true copy of the original (and the foregoing statement need not be qualified on account of the difference permitted by paragraph (a) as to the form of a signature or of a date).

(4) Sections 347 and 348 shall not apply to an existing guarantee company that, immediately before the commencement of this section, stood exempted from the requirements of section 128 of the Act of 1963 by virtue of subsection (4)(c) or (5) of that section, but this is subject to subsections (5) and (6).

(5) If, by reason of a change of circumstances set out in section 128(4) of the Act of 1963 relating to the company concerned (were that section 128(4) to remain in force after the commencement of section 4 (repeals and revocations)), an existing guarantee company would no longer comply with that section 128(4), then, thereupon, sections 347 and 348 shall apply to that company.

(6) If—

(a) circumstances arise affecting an existing guarantee company that stood exempted, immediately before the commencement of this section, from the requirements of section 128 of the Act of 1963 by virtue of subsection (5) of the latter, and

(b) those circumstances are such as would, but for the repeal of that section 128, warrant the relevant authority exercising the power of revocation that but, for that repeal, would have been available to them in relation to the particular order that had subsisted, under that subsection (5), in relation to that company,

then the relevant authority shall, by virtue of those circumstances, be empowered to declare in writing that sections 347 and 348 shall, on and from a date specified in the declaration, apply to that company and, where the relevant authority so declares, sections 347 and 348 shall apply to that company on and from the date so specified.

(7) In subsection (8)—

“electronic means” means those provided for under the Electronic Commerce Act 2000 and effected in compliance with any requirements of the Registrar of the kind referred to in sections 12(2)(b) and 13(2)(a) of that Act;

“required documents” means the copy of the report referred to in paragraph (a) of subsection (3), accompanied by the certificate referred to in paragraph (b) of that subsection;

“required period” means the period referred to in section 343 (2) or (3), as the case may be, or, where that period stands extended in accordance with section 343 (5) and (6), that period as it stands so extended.

(8) Where a CLG makes its annual return by electronic means to the Registrar within the required period then, notwithstanding that the required documents have not been annexed to the annual return, the annual return shall be deemed to have been delivered to the Registrar within the required period with the foregoing documents annexed to it if those documents are delivered to the Registrar within 28 days after the date on which the annual return has been delivered to the Registrar by electronic means.

(9) In this section—

“existing guarantee company” has the same meaning as it has in section 1189 ;

“relevant authority” means—

(a) before the establishment day (within the meaning of the Charities Act 2009 ), the Commissioners of Charitable Donations and Bequests for Ireland; and

(b) on or after the foregoing day, the Charities Regulatory Authority.


Application of section 392 to a CLG

1221. Section 392 (report to Registrar and Director: accounting records) shall apply to a CLG as if, in subsection (6), there were substituted “its members” for “its shareholders”.


Application of section 393 to a CLG

1222. Section 393 (report to Registrar and Director: category 1 and 2 offences) shall apply to a CLG as if, in subsection (4), there were substituted “its members” for “its shareholders”.


CHAPTER 6

Liability of contributories in winding up

Liability as contributories of past and present members and provision concerning winding up after certain re-registration

1223. (1) Subject to subsection (2), in the event of a CLG being wound up, every present and past member shall be liable to contribute to the assets of the CLG to an amount sufficient for payment of its debts and liabilities, and the costs, charges and expenses of the winding up, and for the adjustment of the rights of the contributories among themselves.

(2) The following qualifications apply in relation to subsection (1):

(a) no contribution shall be required from any member exceeding the amount undertaken to be contributed by him or her to the assets of the CLG in the event of its being wound up;

(b) a past member shall not be liable to contribute if he or she has ceased to be a member for one year or more before the commencement of the winding up;

(c) a past member shall not be liable to contribute in respect of any debt or liability of the CLG contracted after he or she ceased to be a member;

(d) a past member shall not be liable to contribute unless it appears to the court that the existing members are unable to satisfy the contributions required to be made by them in pursuance of this Act;

(e) nothing in this Act shall invalidate any provision contained in any policy of insurance or other contract whereby the liability of individual members on the policy or contract is restricted, or whereby the funds of the CLG are alone made liable in respect of the policy or contract;

(f) a sum due to any member of the CLG, in his or her character of a member, by way of distributions, profits or otherwise, shall not be deemed to be a debt of the company, payable to that member in a case of competition between himself or herself and any other creditor not a member of the CLG, but any such sum may be taken into account for the purpose of the final adjustment of the rights of the contributories among themselves.

(3) Without prejudice to the application of that section to a CLG, and its adaptation generally, by section 1173 of section 665 (winding up of company that had been an unlimited company before re-registration), paragraph (c) of section 665 shall apply as if the reference in it to section 655 (2)(a) were, in the case of a CLG, a reference to subsection (2)(a) of this section.


CHAPTER 7

Examinerships

Petitions for examinerships

1224. Section 510 shall apply to a CLG as if the following subsections were substituted for subsections (2) and (3):

“(2) Where the company referred to in section 509 is an insurer or the holding company of an insurer, a petition may be presented only by the Central Bank, and subsection (1) shall not apply to the company.

(3) Where the company referred to in section 509 is—

(a) a credit institution or the holding company of a credit institution,

(b) a company which one or more trustee savings banks have been reorganised into pursuant to an order under section 57 of the Trustee Savings Banks Act 1989 , or

(c) a company which a building society has converted itself into under Part XI of the Building Societies Act 1989 ,

a petition may be presented only by the Central Bank, and subsection (1) shall not apply to the company.”.


CHAPTER 8

Investigations

Application of section 747 (2) to CLGs

1225. Section 747 (2) shall apply to a CLG as if paragraph (c) were deleted therefrom.


CHAPTER 9

Public offers of securities, prevention of market abuse, etc.

Application of Chapters 1, 2 and 4 of Part 23 to CLGs

1226. Chapters 1 , 2 and 4 of Part 23 , so far as they are applicable to companies other than public limited companies, shall apply to a CLG.

The text in italics on this page is sourced from the Irish Statute Book and is re-published under the Licence for Re-Use of Public Sector Information made pursuant to Directive 2003/98/EC Directive 2013/37/EU of the European Parliament and of the Council on the re-use of public sector information transposed into Irish law by the European Communities (Re-Use of Public Sector Information) Regulations 2005 to  2015.