As previously reported, the government plans to introduce a new Companies Bill as part of a move to consolidate and simplify existing company law. On 30 May 2011, the Minister for Enterprise, Trade and Employment published a draft of Pillar A of the proposed Bill. This will represent two thirds of the future Companies Bill and contains all of the law relating to private companies limited by shares. The remainder of the proposed draft is expected to be published in 2012.

In efforts to reduce the administrative costs for existing businesses and encourage new ventures, the existing law will change to allow private companies to hold written annual general meetings (AGMs) in place of the current requirement to hold AGMs in person. A private company will also have the option to appoint only one director. Current law requires these companies to appoint a minimum of two directors. The current memorandum and articles of association will be replaced by one document and the requirement to have specific internal regulations (currently in the form of articles of association) will be removed as companies will be required to abide by the regulations contained in the proposed law.

Other key changes proposed include the area of director’s duties, with offences created by the Bill being designated a specific punishment.

William Fry will provide further updates on the material changes to company law which are proposed in the Bill.

Contributed by David Fitzgibbon.

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