Ireland · Shares, company capital and dividends

Altering company capital and varying the rights attached to a class of shares

the Companies Act 2014 · sections 83 to 86 and 88 to 93

Capital changes generate filings that are easy to miss because the commercial work finishes at the resolution. Particulars of a resolution under section 83(1) must be delivered to the Registrar in the prescribed form within 30 days after the date on which the company passes it (section 83(6)). Where a company consolidates, divides, converts, reconverts, subdivides or redeems, section 92(1) requires notice to the Registrar as well. Where share capital has been increased above the registered capital, notice must be given within 30 days after the date of the resolution (section 93(2)).

Class rights are the second exposure. Where the rights of a class are attached otherwise than by the constitution and the constitution is silent on variation, those rights may only be varied if the holders of the required proportion of that class consent or the required resolution is passed (section 88(2)). Getting that wrong makes the variation itself vulnerable, not merely the paperwork.

Sections 83 to 86 govern the ways in which a company may vary its company capital, including the reduction that requires the Summary Approval Procedure or the court. Sections 88 and 89 govern the variation of class rights and the right of a stated proportion of the class to apply to court to have the variation cancelled. Where the court makes an order on such an application, the company must deliver a certified copy to the Registrar within 21 days after the date of the order (section 89(6)).

Section 90 handles the register consequences of new or altered rights. Where a company allots shares with rights not stated in its constitution or in a resolution or agreement to which section 198 applies, and the shares are not in all respects uniform with shares previously allotted, particulars must be delivered to the Registrar (section 90(1)). Where rights are varied otherwise than by amendment, resolution or agreement, the company has 30 days after the variation to deliver particulars (section 90(3)), and the same 30 days applies where a class is given a name or designation (section 90(4)).

Working files 9 and 10 of the IE-COMPANY agent toolkit cover this situation. Working file 9 works through each alteration of company capital, the authority relied on, and the notice to the Registrar with its date. Working file 10 works through class rights: how they were created, how they may be varied, whether a class meeting or written consent was used, whether any application to court was made, and whether the resulting filings were delivered inside the periods the sections set.

• Working file 9 · Variation and reduction of company capital and notice to the Registrar
• Working file 10 · Variation of the rights attached to classes of shares

ComplianceSME tracks the Companies Act 2014 and updates the toolkit on your account through the Compliance Complete account, so that you are never working from a superseded version. Compliance Complete

• Issuing shares, calls, lien and financial assistance
• Transferring shares, transmission on death and share certificates
• Buying back own shares, treasury shares and cross-holdings
• Paying a dividend and making a bonus issue

The Irish library holds all 75 situations →