Most Common Challenges When Registering a Company in Ireland

22,384 new companies were registered in Ireland during 2023, showing that Ireland is a very popular place to do business. The quality of companies active in Ireland is a testament to what a great place Ireland is to do business. 

Timing is of high importance when setting up a new company. It is advisable to give yourself 6-7 weeks before you can trade with your new Irish company. The company itself can be registered relatively quickly. Business owners need 10-15 days to register their company through the Companies Registration Office (CRO). The registration process brings several challenges. There is a requirement that all Irish registered companies have at least one EEA resident director. Where the company does not have an EEA resident director, Non-EEA directors must secure a bond to the value of €25,000. Please note, this is not the fee for the bond, but the value of the bond. Our team at Nathan Trust can arrange the Non-EEA bond for you while incorporating your new company.

Once your company is incorporated, you must complete a number of tasks before it is able to trade, namely registering the RBO, applying for PPS numbers where required, registering for Corporation Tax, and setting up a business bank account. 

In this article, you'll learn about common obstacles that surface during company setup and practical solutions to tackle them effectively.

Key Requirements for Company Registration in Ireland

Starting a company in Ireland requires you to follow specific legal and administrative steps. Here's what you need to know about the registration process.

Essential documents needed

The Companies Registration Office (CRO) needs specific documents to register your company. You must submit Form A1 which has key details about your company's name, registered office, main activities, and information about directors and shareholders. You also need a company constitution - Private Companies Limited by Shares (LTD) using a single document with the articles of association.

Minimum capital requirements

Different company structures have different capital requirements. Private companies limited by shares (LTD) don't need any minimum capital. However, if you plan to trade publicly, Public limited companies must keep a minimum share capital of €25,000, and pay up at least 25% before they start operations. The issued share capital can be as low as €0.01, which helps small businesses.

Director requirements

Director requirements are the foundations of company registration. Your company must have at least one director who is 18 or older. LTD companies can work with just one director, while other company types need two directors.

Having an EEA-resident director is a vital requirement. Companies without an EEA-resident director need to get a bond worth €25,000. Companies can also ask for a Section 140 Statement by proving they have strong economic ties to Ireland.

The rules limit who can become a director. Undischarged bankrupts and people with more than 25 directorships can't serve as directors. Corporate bodies can't act as directors either. Single-director companies should remember that their director can't be the company secretary at the same time.

Get in touch with us today to ensure a smooth and hassle-free company registration process in Ireland.

Common Legal Hurdles

Starting a business in Ireland comes with several legal challenges that need careful attention. Let's look at the biggest problems and their solutions.

Name approval issues

The Companies Registration Office (CRO) has strict naming rules, especially when you have similarities to existing registered entities. Companies might face objections based on name similarity up to six months after incorporation. The company must change its name within six weeks once it receives the Registrar's direction.

Every company name must end with "Limited" or its acceptable variations. Words like "bank" or "banking" need explicit permission from the Central Bank of Ireland. Names suggesting connections with local government or authorities face immediate rejection.

Non-EEA director challenges

UK-based directors no longer qualify as EEA residents since Brexit. To fix this issue, companies should either appoint an EEA-resident director or arrange a Non-EEA director bond. Getting a Section 137 bond means that you can continue with the incorporation of your new company without the need for an EEA resident director.

The bond stays valid for two years from incorporation or the last EEA-resident director's resignation. Companies can then:

• Renew the bond

• Appoint an EEA-resident director

• Apply for a Section 140 Certificate

Companies that fail to comply face fines of up to €5,000. Non-compliance also stops companies from filing annual returns and working with financial institutions.

Company constitution errors

The constitution forms the foundation document that states the company's share capital and number of shares issued to first subscribers. Companies often make mistakes with filing sequences and miss information in the constitution document.

Private companies limited by shares (LTDs) have their constitution as a single document. This replaces the traditional memorandum and articles of association. Changes need special resolutions, and companies must document and file all modifications with the CRO. The CRO accepts only printed or typed constitutions and rejects handwritten documents.

Documentation Challenges

Proper documentation is essential when registering a company in Ireland. Many businesses struggle with this significant phase and face challenges that delay or complicate their registration process.

Incorrect filing sequence

The Companies Registration Office (CRO) requires meticulous attention to sequence and timing for filing company documents. Annual returns must be submitted within 28 days of the effective date. Late submissions incur a daily penalty of €3 that can reach €1,200 per return and can result in the loss of the company's audit-exemption.

Companies must file their original returns within six months after incorporation. After that, they need to submit returns every 12 months with their financial statements. Most companies face issues with proper register maintenance, which creates problems during company sales or transfers.

The CRO will only accept documents with original signatures and rejects email or fax submissions. Registered documents are hard to change because the Registrar lacks statutory power to modify them. Companies must file new, accurate returns if corrections become necessary, while the original filing stays on record.

Missing information

Incomplete or wrong documentation can create major delays. Companies must keep detailed registers that show current company positions. Here are common oversights:

• Outdated share capital transactions

• Incomplete officer changes

• Missing member information

• Incorrect filing of annual returns

Court intervention becomes necessary to fix information gaps. The CRO accepts documents in good faith, but not all errors show up during the original processing. Companies must ensure their submitted documents contain accurate, complete information.

Companies and their officers can face category 3 offences if they fail to maintain proper documentation. On top of that, documentation gaps might require seller indemnification during company sales. The Companies Act 2014 requires companies to notify changes in their particulars quickly, including changes to registered addresses and officer appointments.

Connect with our team today to begin your company formation journey with Ireland’s most trusted business partners.
Nathan Trust can provide you with a quote based on your specific requirements.

Get in touch with us today to ensure a smooth and hassle-free company registration process in Ireland.

Starting your company in Ireland can be challenging, but knowing what to expect will make the process much easier. It can be difficult to complete the incorporation on your own, especially when you are focused on other areas of your new business. This is why it is important to hire an experienced team to assist you. Working with qualified professionals who understand the process of setting up a business is highly recommended. Our team's knowledge and experience helps our clients avoid common mistakes and stay compliant with Irish company law.

Nathan Trust has more than 25 years of experience in helping small, medium and large-sized companies register in Ireland. Get in touch with us today to ensure a smooth and hassle-free company registration process in Ireland.