Company Law & Compliance

AUTUMN LEGISLATIVE PROGRAMME PUBLISHED

The Government Legislation Programme for Autumn 2025 has been published, including 34 bills for priority publication and 33 bills for priority drafting.

Bills for priority drafting include the Co-operative Societies Bill and the EU Deforestation Regulation Bill. The Miscellaneous Provisions (Registration of Limited Partnerships and Business Names) Bill is listed under “all other legislation”.

CRO: SUMMARY APPROVAL PROCEDURE FILINGS

The provisions of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 prescribing the form of directors’ declarations for the Summary Approval Procedure (SAP) are expected to be commenced shortly. The Companies Registration Office (CRO) has confirmed that it is in the final stages of testing the IT system to enable online filing of SAP declarations. A "transitional period" is anticipated, during which the CRO will accept SAP declarations both online (via CORE) and by email.

AUTOMATIC ENROLMENT RETIREMENT SAVINGS SYSTEM: APPLICATION TO DIRECTORS

Ireland’s new automatic enrolment retirement savings system (AERSS) will take effect from 1 January 2026. It will generally apply to individuals aged between 23 and 60 earning over €20,000 annually, where contributions for their benefit are not being paid through payroll to a qualifying pension scheme or personal retirement savings account (PRSA). The initial assessment as to whether AERSS will apply to an individual will be based on a pay period prior to 1 January 2026, typically November or December 2025. Employers aiming to establish new or revised pension scheme or PRSA arrangements ahead of AERSS taking effect, should act now to ensure that contributions to those new or revised arrangements are reflected in upcoming payrolls.

Generally, the assessment for AERSS will apply to executive directors employed in Ireland in the same manner as it applies other employees and may apply to the fees or other emoluments paid to non-executive directors meeting the eligibility criteria depending on their pay related social security (PRSI) status in Ireland. The implications for directors, including the consequences for remuneration disclosures, require individual assessment.

For more information on AERSS generally, please see the recent webinar recording from our Pensions and Benefits Group: On Demand-Countdown To Compliance: Mastering Auto Enrolment Before It’s Too Late.

HIGH COURT RESTRICTS DIRECTORS FOR FAILURE TO ACT IN COMPANY'S INTERESTS IN INTRA-GROUP ARRANGEMENTS

In Re Downtul Limited; O’Connell v Butler & Butler [2025] IEHC 358, the High Court granted a restriction application under section 819 of the Companies Act 2014, finding that two directors had failed to act responsibly in relation to the conduct of the affairs of the company.

Downtul, a non-trading company, held a commercial lease for a property operated as a café by a related company, Atercin. The same two individuals were directors of both companies (and of over 100 other group companies). There was no formal agreement or enforceable mechanism for Downtul to recover monies from Atercin to meet its liabilities under the lease. Payments from Atercin were made at the directors’ discretion and ceased during the COVID-19 pandemic, resulting in Atercin occupying the premises rent-free for 2.5 years. Downtul became unable to pay its debts as they fell due and entered creditors’ voluntary liquidation.

Corporate structure and intra-group transactions: The Court’s primary finding was that, by putting in place a structure in which Atercin enjoyed the benefit of occupying the property while Downtul bore the burden and risk of the lease without any enforceable right to obtain funds to discharge its liabilities, the directors had failed to act responsibly with regard to the interests of Downtul as a separate legal entity within the group.

Accounting records, financial statements and governance: Failure to keep proper accounting records, the omission of material disclosures regarding the arrangement from the financial statements and the failure to minute board meetings were identified as separate grounds on which the Court was not satisfied the directors acted responsibly. The absence of any record of a board meeting since 2017 made it “extremely challenging for the respondents to show responsible conduct of this Company’s affairs.”

Multiple directorships: The Court noted that holding multiple directorships creates a heightened onus to ensure a separate assessment of each company’s independent interests when key decisions are considered and to identify, document and formalise such decisions. While directors may have regard to the interests of the group, this does not absolve them of their duty to assess the independent interests of the company as a separate legal entity.

Key Takeaways:

• When structuring intra-group transactions, ensure that the arrangements are documented by formal, enforceable agreements. Directors must safeguard the interests of each company as a separate legal entity.
• The decision highlights the importance of robust corporate governance and record keeping, including board minutes and accounting records.
• Group interests do not override the duty to act in the best interests of each individual company, and decisions should be clearly documented for each entity.