Strike-off under new Companies Act 2014

The New Act introduces a formal Voluntary Strike-off procedure.  Voluntary strike-off is now set in legislation instead of an administrative procedure and there are new prescribed forms under the Act. No voluntary strike-off notices are required to be issued under the new legislation.

Introduction of formal Voluntary Strike-off procedure

Strike-off is not always involuntary. A company that ceases to trade, or has never traded, and has no outstanding creditors can request that the Registrar strike off the company. Under the Companies Act 2014, this procedure has been placed on a formal setting.

Conditions for Voluntary Strike-off

Section 731 of the Companies Act 2014 sets out the conditions for the voluntary strike-off application. A company may apply to the Registrar to be struck off the register if the following conditions are satisfied:

  • (a) the circumstances relating to the company are such as to give the Registrar reasonable cause to believe that it has never carried on business or has ceased to carry on business;
  • (b) the company has, within 3 months before the date of the application, by special resolution -
      (i) resolved to apply to the Registrar to be struck off the register on the ground that it has never carried on business or has ceased to carry on business; and
      (ii) resolved that pending the determination (or, should it sooner occur, the cancellation, at its request, of this process) of its application to be struck off, the company will not carry on any business or incur any liabilities;
  • (c) the company has delivered to the Registrar all annual returns required by section 343 that are outstanding in respect of the company as at the date of the application;
  • (d) the company has delivered to the Registrar a certificate in the Form H15 (filing fee €15) signed by each director certifying that as at the date of the application -
    • (i) the amount of any assets of the company does not exceed €150; 
    • (ii) the amount of any liabilities of the company (including contingent and prospective liabilities) does not exceed €150; and 
    • (iii) the company is not a party to ongoing or pending litigation;
  • (e) the Registrar has received from the Revenue Commissioners written confirmation dated not more than 3 months before the date on which the Registrar receives the application that the Revenue Commissioners do not object to the company being struck off the register; and
  • (f) the company has caused an advertisement, in the prescribed form, of its intention to apply to be struck off the register to be published within 30 days before the date of the application in at least 1 daily newspaper circulating in the State.

Where an application under this section by a company to be struck off the register is made within one year after the date on which the company has changed its name or its registered office (or both), then, as the case may be –

  • (a) the former name of the company, as well as the existing name of the company; or
  • (b) the former address, as well as the current address, of the company’s registered office; or
  • (c) both its former name and the former address of its registered office, as well as the existing name of the company and the current address of its registered office, shall be stated in the advertisement.

CRO Gazette - Public notice in case of voluntary strike-off

As soon as is practicable after the receipt of an application by a company to be struck off, that satisfies the conditions, the Registrar shall, by publishing a notice in the CRO Gazette, give public notice of the Registrar’s intention to strike the company off the register. The CRO Gazette is published every week on the CRO’s website. The company will be dissolved within 90 days of the date of this notice unless an objection is received.

An objection to the strike-off, using Form H16 (member of public) or Form H17 (the company itself), must be received within 90 days of the notice  in the CRO Gazette. Link to  page.Forms CRO

Objection to Voluntary Strike-off

Any person may deliver to the Registrar an objection to the striking off of the company in the form H16. The objection must be confined to the ground that one or more of the conditions set out at (a) to (f) above that have not been satisfied. The period to object ends 90 days after the date of publication of the notice of strike-off.  The Registrar will strike off the company if no valid objection is made and the company will be dissolved.

Company requests that application be cancelled

The company may request, by delivering to the Registrar a notice in Form H17, the cancellation of the process of its being struck off the register. The request must be submitted within the 90 days of the date of the publication of the notice of strike-off.

Please refer to Information Leaflet 28 for format of the Advertisement to be used in Voluntary Strike-off Application.

Involuntary Strike-off

There are several grounds for the strike-off of a company from the register involuntarily.  The grounds are:

  • The company has failed to make an annual return as required by section 343;
  • The Revenue Commissioners have given a notice under section 882(3) of the Taxes Consolidation Act 1997 to the Registrar of the company’s failure to deliver the statement required under section 882 of that Act;
  • The Registrar has reasonable cause to believe that section 137(1) is not being complied with in relation to the company - (the requirement to have an EEA resident director);
  • The company is being wound up and the Registrar has reasonable cause 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;
  • There are no persons recorded in the office of the Registrar as being current directors of the company.

Companies should note that a company may be struck off the register if it has failed to file an annual return for one year.

Consequences of Strike-off

The consequences are very serious for a company that is still trading:

  • The assets of the company become the property of the State on dissolution of the company;
  • The company ceases to exist as a legal entity with effect from the date of strike-off and dissolution;
  • The protection of limited liability is lost with effect from that date, and if the business formerly carried on through the company is continued, the owners are trading in their personal capacity;
  • Banks should be unwilling to lend money to an entity which has, effectively, ceased to exist;
  • There can also be unpleasant consequences for directors of such companies in that a disqualification order may be made against them by the High Court on the application of the Director of Corporate Enforcement.

Procedure

In accordance with section 728 of the Companies Act 2014, the registrar may give notice of the Registrar’s intention to strike a company off the register on one of the grounds set out above.

It is the policy of the CRO to issue non-statutory reminder letters to non-compliant companies. These notices are issued by email where an address has been supplied or where the previous annual return was submitted electronically. The strike-off process commences with the issue of the statutory strike-off notice.

The Registrar will send the notice by registered post - to the company at its registered office as recorded on the register or if an individual is recorded in the office of the Registrar as the liquidator of the company, to the liquidator.

The Registrar will also send a copy of the foregoing notice by prepaid ordinary post to such persons, if any, as are recorded in the office of the Registrar as being current directors of the company but non-compliance with this subsection does not affect the validity of the process. The address to which a notice under this subsection is sent shall be the usual residential address, as recorded in the office of the Registrar, of the addressee concerned.

Where a company does not have a registered office notified to the CRO, instead of giving a notice under section 727(1), the Registrar will publish a notice in the CRO Gazette containing the information required by section 728 where -

(a) the company has not, for 20 or more consecutive years, made an annual return as required by section 343; and (b) no notice of the situation of the registered office of the company has been given to the Registrar as required by section 50.

Contents of Registrar’s notice to company

The Registrar’s notice under section 727(1) will -

  • (a) state that the issue of the notice is the first step in a process that may lead to the company being struck off the register;
  • (b) state the ground or grounds for striking off being invoked by the Registrar;
  • (c) state that the company will be dissolved if it is struck off the register;
  • (d) state that each director of the company at the date that the notice is sent is liable for disqualification if the company is struck off the register (this does not apply to companies in liquidation);
  • (e) specify the remedial step;
  • (f) specify the date on or before which the remedial step must be taken (28 days); and
  • (g) state that failure to take the remedial step on or before the date so specified may result in the Registrar giving public notice of an intention to strike the company off the register.

The date to be specified for the purposes of subsection (1)(f) shall be a date falling not less than 28 days after the date of the notice.

Remedial Steps that can be taken to remove a company from the strike-off process

The remedial step to have a company removed from the strike-off process is whichever of the following applies:

  • the delivery to the Registrar of all annual returns as required by section 343 that the company has failed to make;
  • the delivery to the Revenue Commissioners of the statement that the company is required to deliver under section 882(3) of the Taxes Consolidation Act 1997;
  • the provision to the Registrar of evidence that section 137(1) is being complied with in relation to the company;
  • the provision to the Registrar of the details of the liquidator and of up to date periodic statements having been furnished under section 681;
  • the notification to the Registrar under section 149(8) of the appointment of a director of the company.

The CRO Gazette - Public notice of intention to strike company off register

If the Registrar has given a notice and the remedial step has not been taken on or before the date specified in that notice, the Registrar may, by publishing a notice in the CRO Gazette that gives public notice of the Registrar’s intention to strike the company off the register. The CRO Gazette is published on the CRO website each week - www.cro.ie. The date shall be a date falling not less than 28 days after the date of publication of the notice.

For more information please go to Leaflet No. 28