Banner

Major Changes to Filing Obligations for Unlimited Companies

10 January 2017

Major Changes to Filing Obligations for Unlimited Companies

The Companies (Accounting) Bill 2016 (the "Bill") which is due to be enacted early in 2017 makes some significant changes regarding filing obligations for certain unlimited companies utilised in non-filing structures.

What are the changes and who do they affect?

Currently, the Companies Act 2014 provides that an unlimited company that is incorporated in Ireland must file its financial statements in the Companies Registration Office of Ireland ("CRO") if it is of a designated type.

The definition of "designated unlimited company" included in the Companies Act 2014 contains a loophole due to the fact that an unlimited company is deemed to be such a designated unlimited company if its members are themselves unlimited companies but only where they are governed by the laws of an EU Member State.  In other words, if an Irish unlimited company has a member which is an unlimited company incorporated in a jurisdiction outside the EU then such unlimited company is not deemed to be a designated unlimited company and does not have to file its financial statements with the CRO. This loophole has traditionally been taken advantage of to minimise disclosure obligations while limiting liability.

The Bill amends the Companies Act 2014 by widening the definition of "designated unlimited company" so that current non-filing unlimited company structures ("Non Filing ULCs") will no longer be effective once the Bill becomes law. Consequently, Non-Filing ULCs which are currently exempt from filing their financial statements with the CRO will be obliged to file their financial statements with their annual returns thereby making them publicly accessible.

When do these changes take effect? 

The Bill does not specify the effective date for filing financial statements for designated unlimited companies.  Directive 2013/34/EU on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings (the "Directive") (pursuant to which these changes are being transposed into Irish law) does state that the new rules must apply for financial years commencing on or after 1 January 2016, however, there is a possibility that this could be extended to 1 January 2017 given the delay in transposing the Directive.

It should be noted that financial statements will need to show previous year comparisons so that financial information for the then-prior accounting period will, as a result, also be disclosed.

What should you do?

Companies concerned about protecting sensitive information which may become publicly accessible as a result of these proposed changes should talk to us.

Further Information

Should you have any questions or would like to discuss the above, please contact your usual Maples and Calder contact.

It should be noted that these new obligations also apply to investment funds established as investment companies (both UCITS and AIFs). For further details on the implications of the new obligations from an Irish funds perspective, please liaise with your usual Maples and Calder contact in our Irish Funds Group.


Back to the top

Filter by:

Search filters
Sign up to receive our articles, newsletters and news alerts.