Transcript Document
Dublin Chamber of Commerce
‘Bright and Early’ Briefing
24 April 2002
“Your Company and the Law”
Paul Appleby
Director of Corporate Enforcement
Outline of Presentation
What are the Responsibilities of Directors?
ODCE – Why has it been established?
ODCE Role – what is it doing?
ODCE Services – what can we do for you?
Where can you get company law information?
Conclusion – where are we heading?
Directors’ Responsibilities (1)
The Company – a Separate Legal Person
General Duties of Directors
Act in the Company’s (not Personal) Interest
Act with Due Care, Skill and Diligence
Defined Legal Obligations/Constraints
Disclosure Requirements
Directors’ Responsibilities (2)
Company Documents to be kept,
updated and made available
Register of Members
Register of Directors and Secretary
Register of Directors’/Secretary’s interests
Register of debenture holders
Directors’ Service Contracts
Minute Books
Directors’ Responsibilities (3)
Basic Operational Obligations
Keeping proper books of account
Holding the annual general meeting (AGM)
Circulating to members before every AGM a
signed copy of the balance sheet, profit and loss
account, director's and auditor's report
Holding an extraordinary general meeting when
circumstances require
Directors’ Responsibilities (4)
General Filing Obligations
Change in constitution of company
Change in registered office
Change of directors/secretary
Increase in Nominal/Issued Capital
Annual return
Mortgages and charges
Bridging the Compliance Gap (1)
“Irish company law has been characterised by a
culture of non-compliance…”
“Enforcement of the law in relation to non-registration
offences has been very rare and wholly
unpredictable…”
(Offenders) “have little reason to fear detection or
prosecution…”
“…the sound of the enforcer’s footsteps on the beat is
simply never heard…”
- McDowell Working Group Report (1998)
Bridging the Compliance Gap (2)
Approach of the McDowell Group
Codify and Simplify Company Law
Extend/Improve Enforcement Measures
Establish a Dedicated Enforcement Office
Resource the Companies Registration
Office Role
Bridging the Compliance Gap (3)
Company Law Enforcement Act
Enforcement of filing obligations stays with the
Registrar of Companies
New Office of Corporate Enforcement will deal
with Companies Acts in general
Measures to streamline enforcement
Company Law Review Group is being set up on a
statutory basis
ODCE Role and Powers (1)
Compliance Role
Public presentations
Information strategies
Printed media
Electronic media
Engaging with professional bodies
Other Initiatives
ODCE Role and Powers (2)
Fact-finding company investigations
Apply to appoint High Court Inspector(s) to
conduct wide-ranging company inquiry
Appoint Inspector directly to establish interest
in company shares/debentures
Examine a company’s books/documents
Require production of the books
Demand explanations
ODCE Role and Powers (3)
Detected Breaches of the Acts
Seek to impose an administrative fine
Initiate a summary prosecution
Refer the case to the DPP for decision
ODCE Role and Powers (4)
Insolvent Companies
Seek Court order to inspect the books
Seek to have Court examine directors, etc.
Seek Court order to search for and acquire
property, etc.
Seek arrest warrant
Seek Court assessment of damages
Seek Asset-Freezing Order
ODCE Role and Powers (5)
Restriction of Company Officers
Liquidators of insolvent companies must apply
to Court to restrict directors, unless exempted
by ODCE
ODCE can directly seek Court declaration of
restriction
Nominal value limits increased to £50K and
£250K in private and public companies
ODCE Role and Powers (6)
Disqualification of Company Officers
ODCE can directly seek Court order of
disqualification
Specific criterion is a person guilty of two or
more offences of failing to keep proper books
Another criterion is a person in persistent
default of the relevant requirements
ODCE Role and Powers (7)
Liquidations and Receiverships
Will obtain copy of notice of appointment of
liquidator/receiver from the Registrar
May require production of his/her books
May seek explanations of conduct
Receiver will require to state if company is
solvent at the close of the receivership
ODCE Role and Powers (8)
Other Measures
Mandatory reporting of suspected breaches of
company law to ODCE by auditors, liquidators,
professional bodies
Regulation of undischarged bankrupts acting as
company directors
Seek other Court orders/injunctions
Increase in penalty provisions
Timetable for Commencement
Many Provisions in Effect, including:
Company Law Prosecutions
Restrictions and Disqualifications
A number of CRO Enforcement Measures
Company Investigations
Outstanding Provisions include:
Winding up and Insolvency (possibly 1 June)
Compliance Information Service
Companies
Company Directors
Company Secretaries
Members/Shareholders
Auditors
Creditors
Liquidators
Receivers
Examiners
General Information Service
Introduction to the ODCE
Annual Reports
Presentations/Statements
Legislative Changes
Information Request Facility
Complaints Facility
Complaints about Companies Act Breaches
Auditor/Liquidator/Professional Body
Reports on Indictable Offences
CRO Information
Failure to keep Proper Books
Information-Sharing Arrangements
Other ODCE Services
Consultation Service
Registration Service
Freedom of Information Service
Feedback Service
Sources of Information (1)
www . basis. ie
Company Law
Employment Legislation
Environmental Legislation
Health and Safety Requirements
Others
Sources of Information (2)
www. odce .ie
About the ODCE
ODCE Services
ODCE Publications/Statements
Legislation
Court Decisions
Sources of Information (3)
Consultation Papers
No. 1 - Duties and Powers of Directors, etc.
No. 2 – Auditor Reports of Indictable Offences
No. 3 – Insolvent Companies in Liquidation
No. 4 – Unliquidated Insolvent Companies
Sources of Information (4)
Decision Notices
On Consultation Papers
On Exemptions from applying for Restriction
Court Decisions
Prosecutions
Company Investigations
Restrictions/Disqualifications
Sources of Information (5)
www. cro. ie
Information
Doing Business with the CRO
CRO Fees
Search
Free Public Search Facility
Registered Client Search Facility
Sources of Information (6)
www. clrg. org
About the Company Law Review Group
Text of the CLRG’s First Report (195 changes)
Making Comments on the First Report
CLRG’s Second Work Programme (7 areas)
Submissions on the New Work Programme
Where are we heading? (1)
McDowell Working Group Report (1998)
Two Companies Acts (1999)
Auditing Review Group Report (2000)
Company Law Enforcement Act (2001)
Establishment of the ODCE (2001)
Active Company Law Review Group (2000-2002)
Publication of draft IAASA Bill Heads (2002)
Where are we heading? (2)
Why Bother with Compliance?
Our Reputation as a Place to do Business
Our Need to have an Ordered Society
Our Need to minimise Business Risks
Our Need for Sound Competitive Enterprise
Protection of Business and Government
Revenue
Where are we heading? (3)
Elements of a Compliant Environment
Simplified Legislation/Regulation
Accessible Compliance Information
Good Reporting of Non-Compliance
Effective Enforcement Arrangements
Where are we heading? (4)
Key Elements of ODCE Strategy
Provide Informative Non-Technical
Material on People’s Legal Obligations
under Company Law
Help People to articulate their Concerns
about Suspected Company Law Malpractice
Bring to Account those who breach the Law