Company Limited By Guarantee In Ireland in 2023-24
Ireland is the perfect location to launch a company. There’s been a dramatic shift in the way that corporate law is implemented in Ireland since the Companies Act (2014) came into effect on June 1st, 2015. A few reforms have been implemented in Ireland to encourage foreign investment, and thus boost the economic growth of the nation.
One of the methods that investment can be made in Ireland is through companies being formed. There are many types of business entities, that exist in Ireland and one of which is a Company Limited by Guarantee in Ireland.
This article will discuss the procedure to form a Company Limited by Guarantee in Ireland.
What is Company Limited by Guarantee in Ireland?
One kind of business that can be formed in Ireland is to establish a company limited by guarantee. A Company Limited by Guarantee in Ireland is a kind of business structure that does not have shares capital and the constitution state that the members’ liability is restricted to the amount that they may each agree to contribute to the CLG’s assets in the case of the CLG’s winding-up.
In this kind of business structure, the majority of the companies that are user-owned are in the field of sports, charities social clubs, as well as management businesses. One of the most important characteristics of CLG is that it lacks share capital, meaning that its members are not shareholders, and have no exclusive economic stake in their assets.
How to register a Company Limited by Guarantee in Ireland?
Since this kind of business has no allocated share capital which means that the shareholders don’t have to purchase shares in the business. Numerous professional and charitable bodies consider this type of company to be an appropriate vehicle to benefit from an independent legal entity and restricted liability but do not need to solicit funds from members.
The process to establish the Company Limited by Guarantee in Ireland includes the following steps:
- The initial step is to enroll the company’s name. A name for a CLG must begin with “company limited by guarantee in Ireland” “company limited by guarantee” as well as “cuideachta faoi theorainn rathaiochta”. The words “company limited by guarantee” can be abbreviated as “c.l.g.” or “clg” and the phrase “cuideachta faoi theorainn rathaiochta” could be abbreviated as “c.t.r.” or “ctr” at any time following the registration of a company.
- The company should have an office registered in Ireland. A registered office for a business is the address at which CRO correspondence as well as all legal notices in writing sent to the company’s address will be addressed.
- It is time to write a Constitution (Memorandum as well as Articles of Association). The constitution should be in line with the structure outlined within the Act and consist of the memorandum of association as well as articles of association.
- The following step will be to make payment of the registration fees.
After everything has been scrutinized by the authorities your application will then be approved and you will be able to establish your company in Ireland.
Characteristics of the Company Limited by Guarantee in Ireland
- A CLG must be governed by 2 directors, and at least one shareholder.
- Directors can also take on the dual role of active members.
- They are an entity legal that is and distinct from its shareholders.
- They can purchase and sell properties under the name of the organization.
- A guarantee company that is in existence but that has no capital share is considered a CLG at the time of the enactment of this Act.
- This kind of business can be exempt from audits, however, one of the members may protest against the same.
- AGM can be skipped if a CLG is comprised of a single member.
- The CLG is governed by a single document constitution, which includes an agreement memorandum and the articles of association.
Activities carried out under CLG in Ireland
- Charities: Charitable Status for Charities could be requested from Revenue Commissioners.
- Residents Associations
- Property management services.
- Educational Institutions
- Sport clubs
- Trade organizations
- Professional organizations
Benefits of Company Limited by Guarantee in Ireland
- A limited company by guarantee is a legal entity distinct that is independent of its owners and accountable for its liabilities.
- The personal financials of the corporate guarantors are safeguarded. They are only accountable for the payment of company debts up to the sum of their guarantee.
- The status of ‘Limited’ builds confidence and trust with customers and investors. This kind of professional credibility is important and helps a business to achieve its goals more efficiently.
Conclusion
Company Limited by Guarantee in Ireland doesn’t have share capital. They do not have to seek funds from members, and they can still enjoy the advantages of a restricted liability and are a distinct legal entity. The liability of members is only limited to the amount that they have agreed to contribute towards the financial assets of the company, and this amount must be no less than EUR1 for the eventuality the company is wound-up.
If you have any questions about Company Limited by Guarantee in Ireland. We are Odint Consultancy. We are here to assist you.
FAQ’s
In Ireland, there is no share capital to form a company limited by guarantee.
Company Limited by Guarantee business model is suitable for nonprofit organisations.
- Members of the business have limited liability for the business’s obligations because the firm is a distinct legal entity from them.
- The personal financials of the corporate guarantors are safeguarded. They are only accountable for the payment of company debts up to the sum of their guarantee.
At least 2 directors are needed to operate a Company Limited by Guarantee in Ireland.
It is essential to have at least one director and one guarantor, however, one person can take on both roles, so you could set up a business by yourself. Alternatively, you could have several directors and guarantors.
