The new Companies Act introduced in June 2015 a new type of limited company – the designated activity company (DAC), which is different than the traditional limited liability company, in the sense that its main statutory documents have to stipulate detailed objects of activity that the legal entiy will operate. Local and foreign businessmen who want toopen a company in Irelandas a DAC will be able to choose from two types of business forms: the DAC limited by shares and the DAC limited by guarantee. Our team of Irish lawyers can provide in-depth assistance on the incorporation requirements for these structures, as well as on their main benefits.
DAC limited by shares in Ireland
The DAC in Ireland provides similar regulations applicable to Irish limited companies. For example, just like in the case of a private company limited by shares, in a DAC limited by shares, the company’s shareholders will be liable for the debts incurred by the legal entity only in amount of the shares they have contributed with the company’s capital. Our team of lawyers in Ireland can provide further assistance on the rights and obligations of the company’s founders.
The video below offers a short presentation on the Irish designated activity company:
This business form can have a maximum of 149 members and, during the registration procedure, the company’s investors will have to appoint minimum two directors.
The main statutory document of a DAC limited by shares is represented by a Constitution, which is comprised of the memorandum and the articles of association, documents that have to state the company’s specific business purposes.
Thelegal entityis regulated by Part 16 of the new Companies Act and foreigners who want to set up this type of company are required to add the words “Designated Activity Company” or “Cuideachta Ghníomhaíochta Ainmnithe” at the end of the company’s trading name, which has to be registered with the Companies Registration Office.
DAC limited by guarantee in Ireland
The DAC limited by guarantee provides similar regulations as the DAC limited by shares, as both legal forms are regulated by Part 16 of the Companies Act. However, the main difference is given by the founder’s liability, who are liable on the following legal grounds:
•liable in accordance with the shares they own in the company;
•liable in amount they have contributed with the company’s assets.
Businessmen are invited to contact our law firm in Irelandfor more details on the DAC legal entities. Our lawyers can offer advice on the tax regulations available for both types of companies.
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