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New Involuntary Strike-Off Powers

Legislative landscape

The majority of the provisions of the Companies (Corporate Governance, Enforcement and Regulatory Provisions) Act 2024 (the 2024 Act) were commenced on 3 December 2024, amending the relevant sections in the Companies Act 2014 (the 2014 Act).

Under section 726 of the existing 2014 Act, the Registrar of Companies has powers to involuntarily strike a company off the company register where:

  • the company has failed to make its annual return;
  • the Revenue Commissioners have given notice that the company failed to deliver to them a statement of particulars on commencement of trading;
  • the Registrar has reasonable cause to believe that the company does not have a Section 137 bond in place despite having no EEA resident directors;
  • the company is being wound up and the Registrar has reason to believe that no liquidator is acting;
  • the company is being wound up and the Registrar has reasonable cause to believe that the affairs of the company are fully wound up and that the returns required to be made by the liquidator have not been made for a period of 6 consecutive months; and/or
  • there are no persons recorded in the office of the Registrar as being current directors of the company.

New Grounds

Under the 2024 Act, which amends Section 726 of the 2014 Act, the Companies Registration Office (CRO) will have further grounds to list Irish registered companies for involuntary strike-off. These new grounds include:

  • the company has failed to notify the CRO of a change of its registered office;
  • the company has no secretary recorded with the CRO; and/or
  • the Registrar of Beneficial Ownership has given notice to the CRO of a company’s failure to provide its beneficial ownership information to the Central Register of Beneficial Ownership.

Involuntary Strike off

When a company is involuntarily struck off the register, it is dissolved by the CRO and ceases to exist.

When a company is listed for involuntary strike off, the CRO will firstly issue one or more non-statutory reminder letters to non-compliant companies. Where the company rectifies the issue, this will stop the strike off. Where the company continues to be in breach, a formal statutory strike off notice will then be issued to the company’s registered office. Following this, a notice of impending strike off will be published in the CRO Gazette. 28 days after the notice is published in the CRO Gazette, the company will be struck off the register unless the outstanding issue has been rectified. After strike off, a further notice dissolving the company will be published in the CRO Gazette.

Consequences

Following the strike-off of a company, it ceases to exist as a legal entity from the date of the dissolution notice in the CRO Gazette. Any assets it owns are vested in the State, and the limited liability of the shareholders is lost. If the business is continued, the shareholders would be trading in their personal capacity and can have full personal liability.

Where a company has been involuntarily struck off for failure to file annual returns, the Corporate Enforcement Authority may apply to the High Court for an order pursuant to Section 842(h) of the 2014 Act, disqualifying the directors of the struck-off company from acting as director or having any involvement in the management of any company in future.

Directors of companies that have been involuntarily struck off can be restricted or disqualified from acting as a company officer in future by the High Court.

Restoration

A company which has been struck off the register may be restored under Section 737 of the 2014 Act within 20 years of dissolution. Where a company has been struck off the register within the previous 12 months, it can apply for restoration directly with the CRO. Where a company has been struck off the register for over 12 months but less than 20 years, the company or any member must apply to the High Court to be restored.

In order to be restored, companies must ensure that all CRO filings outstanding between the date of strike off and the date of requesting restoration have been prepared. The company must also ensure that the CRO has no objection to the restoration.

The Corporate Team at Whitney Moore would be happy to assist with any queries or issues you may have regarding the new legislation or strike-off risks generally.

Authored by Brendan Ringrose, Corporate Partner and Hannah Bergin, Trainee Solicitor at Whitney Moore LLP.