While the United Kingdom officially withdrew from the European Union on 31st January 2020, the 11-month Brexit transition period actually concluded on 31st December 2020. This meant that new rules for both citizens and businesses came into force as of 1st January 2021. It's important to understand how this affects your business in the UK and how you can keep a foothold in the EU. For many UK businesses, Ireland is an attractive destination to establish a presence within the EU single market.
As a result, existing companies in the UK may consider setting up an Irish subsidiary, Irish Holding Company, new Private Company Limited by Shares (LTD) or Designated Activity Company (DAC), depending on their transactional and business needs.
Ireland as a Solution to Maintain Operations in the EU After Brexit
Due to Brexit, UK businesses are no longer considered EU companies. If these businesses want to continue to benefit from the advantages of the EU single market, they may be required to establish a presence in another EU member country.
Ireland is a viable option as it’s the closest geographically, uses English as the official language and its systems are based on Common Law, similar to the UK. In fact, in one of our recent articles, ‘Global Business Expansion: Why Register a Business in Ireland’ we explored how Ireland is home to supportive business legislation and collaborative ecosystems.
How then, as a business, can you be proactive with the aftermath of Brexit? And what are your considerations when forming and incorporating in Ireland? See below for more.
Forming a Limited Company in Ireland
Whether you’re forming a new standalone company or a subsidiary/holding company in Ireland, the formation process with the Companies Registration Office (CRO) is fairly straightforward (Limited Companies are required to have a constitution). With the help of reliable professionals, the process of incorporation can be completed online and relatively quickly.
Appointing a Resident Director
It’s important to remember that Irish companies are required to have at least one EEA (European Economic Association) resident director on the board to ensure compliance with local laws. However, directors residing in the United Kingdom will no longer be considered EEA residents. In addition to having a local director, you’ll need to appoint a company secretary to help ensure your company stays in good standing and up-to-date on filings. If the company has more than one director, they can also fulfil the role of a company secretary.
In the absence of a resident director, the Companies Act 2014 requires the company to have an insurance bond that secures the company against offences.
However, there are no residency requirements for shareholders of an Irish company.
Every Limited Company formed in Ireland is required to have a registered office in the country. The address must be a physical location, not just a post office box number. People have the right to visit the company's registered office to inspect certain registers and documents and to deliver documents by hand. An authorised agent can serve as the registered office.
Following the European Union's Fourth Anti-Money Laundering Directive (4AMLD), every EU member country is now required to obtain and hold "adequate, accurate and current information on the beneficial ownership" of its corporate and legal entities. They are also required to establish a central register of beneficial ownership. Accordingly, Irish companies and other legal entities are now required to disclose their beneficial ownership to the Central Credit Register by completing certain details online.
Irish companies are required to file annual returns each year to confirm the details of the company as well as file annual accounts containing the financials of the company.
In addition, Irish companies are also responsible for filing event-based compliance in order to remain compliant with the Companies Act 2014. This includes any changes to directors and increases in capital as well as the appointment or termination of company secretaries, to name a few.
Related read: Ireland: A Hub For The Aviation Industry
Putting It All Together
When it comes to formation and incorporation in jurisdictions abroad, sometimes the process can become complicated. As you form subsidiaries, you may need to send documents from one jurisdiction to another — which could require authentication and legalisation. You may also need help navigating country-specific business regulations to help you register your company without delays.
Think you may need international company formation support when incorporating your business in Ireland? A professional service provider could be just what you need to assist in the annual maintenance of your company.
This content is provided for informational purposes only and should not be considered, or relied upon, as legal advice.