As you probably know next Wednesday 30th of November 2016 your limited company will be statutorily defaulted to a Model Private Limited Company. While this “Do Nothing” option may sound attractive there are a number of implications for companies and directors who allow a statutory default occur.
• S.60 of the Act compels directors to convert the company if a members driven conversion or other form of re-registration is not completed prior to 30th of November 2016.
• Even when a company is statutorily defaulted to a Model Private Limited Company, while the company is issued with a new certificate of incorporation by the CRO, they will not have a formally updated constitution which may cause future delays in relation to banking and legal transactions.
• Under S.62 of the Act, if in the future, members make an application under S.212, where the directors have failed to comply with the requirements of S.60, it will be presumed until the directors prove otherwise, that the directors have acted in a manner oppressive to the member who makes the application.
• Failure to convert in a company in accordance with either S.59 or S.60 of the Act will result in a breach of the requirements of every director to comply with company law and potentially result in a breach of their fiduciary duties.
• If you want convert the constitution after 30 November you will have to pay CRO fees in addition to secretarial fees. So it is cheaper to convert now
Further information about the process please read my blog http://www.accountable.ie/to-convert-or-not-to-covert-deadline-is-wednesday-31st-august/
Don’t get left behind like this guy take action today to comply with the Companies Act update your constitution memo and articles.
Please feel free to contact me would be delighted to assist you in any way that we can.