Company Registration

Dáil Éireann Debate, Tuesday - 2 July 2013

Tuesday, 2 July 2013

Ceisteanna (426, 428, 429)

Andrew Doyle

Ceist:

426. Deputy Andrew Doyle asked the Minister for Jobs, Enterprise and Innovation the number of new companies, of various types, that have been registered with the Companies Registration Office in tabular form on a yearly basis between 2008-2012, and to date in 2013; and if he will make a statement on the matter. [31797/13]

Catherine Murphy

Ceist:

428. Deputy Catherine Murphy asked the Minister for Jobs, Enterprise and Innovation if he will outline the number of companies who have been struck off in each year since 1986 due to the failure to file annual returns to the Companies Registration Office; and if he will make a statement on the matter. [31978/13]

Catherine Murphy

Ceist:

429. Deputy Catherine Murphy asked the Minister for Jobs, Enterprise and Innovation if he intends to review the provision in the Companies Acts which permits the Companies Registration Office to strike off a company which has failed to provide annual returns in order to introduce a wider scale of penalties which are proportionate to the offence; and if he will make a statement on the matter. [31979/13]

Freagraí scríofa

Minister for Jobs, Enterprise and Innovation

I propose to take Questions Nos. 426, 428 and 429 together.

The number and type of new companies registered since 2008 are set out in the following table:

Company Type	2008	2009	2010	2011	2012	2013 (as at 27 June)
Private limited	13468	12396	13054	13621	13104	7195
Public limited	117	133	164	170	115	68
Unlimited	133	136	220	293	235	69
Guarantee	1005	656	575	531	555	246
EEIG – European Economic Interest Grouping	0	0	0	0	0	1
Total of all companies	14723	13321	14013	14615	14009	7579

The number of companies that have been struck off in each year since 1986 due to the failure to file annual returns to the Companies Registration Office is as follows:

-	-	-	-	-	-	-	-	-	-	Total per decade	Average per decade
1986	1987	1988	1989
2551	3693	830	14338							21412	5353
1990	1991	1992	1993	1994	1995	1996	1997	1998	1999
8975	0	5607	13087	4840	13176	10280	3132	10003	28731	97831	9783
2000	2001	2002	2003	2004	2005	2006	2007	2008	2009
32937	1430	3125	14836	1401	9514	5255	4085	5804	5729	84116	8412
2010	2011	2012	2013 (as at 27 June)	-	-	-	-	-	-	-	-
6272	7938	7333	4208	-	-	-	-	-	-	25751	7357

The Companies Acts 1963-2012 set out the requirements in relation to the filing of annual returns by companies.

Section 125 of the Companies Act, 1963, as amended, requires that an annual return be delivered by a company, whether trading or not, to the Companies Registration Office (CRO) once at least in every calendar year. If a company fails to comply with the Section, the company and every officer of the company who is in default shall be guilty of an offence.

A company may be struck off the register for failure to file an annual return. If a company is struck off, the assets of the company become vested in the Minister for Finance, and if the business continues to trade, the members will no longer enjoy the benefit of limited liability and so are personally responsible for any debts incurred as long as the company remains struck off.

Any person, who was a director of a company at the date of sending to that company of a strike off notice due to the non-filing of annual returns, may be disqualified from acting as a director by the High Court, where the company is struck off leaving outstanding liabilities. Such order may be made by the Court on the application of the Office of the Director of Corporate Enforcement.

The Registrar of Companies may prosecute companies and/or directors in the District Court for failure to file annual returns and accounts on behalf of their companies. In addition, she may also apply to the High Court for an order directing the filing of outstanding annual returns and accounts within the period specified in the order and she may seek to have all the costs of and incidental to that application, borne by the defaulting company or its officers.

There are also other sanctions in relation to the failure to file or the late filing of annual returns. A late filing penalty of €100 becomes due in respect of an annual return on the day after the expiry of the filing deadline, i.e. 28 days after the effective date of the return. A daily penalty amount of €3 accrues thereafter up to a maximum penalty of €1,240 per return. This penalty is in addition to the standard fee for filing the return.

A company with a record of persistent late filing may also be subject to an on-the-spot fine and/or summary prosecution of the company and/or any officer in default. Fines of up to €1,904.61 can be imposed on conviction for breach of the annual return filing requirements. In addition, a company cannot avail of the exemption from the requirement for a statutory audit if its annual return for the current year or the previous year was not filed on time.

In 2011 the Company Law Review Group, the statutory body which advises me on Company Law matters, published its examination of certain aspects of the late filing penalty regime. The Group noted that prior to 2001, only 13% of companies filed their annual returns on time, whereas in 2010 only 12% of companies were late filing their returns. It recommended that no changes should be made to the current system.

I have no plans to expand the range of penalties attaching to the late filing of annual returns.