Directorship of a company

A company director is a person duly appointed by the members of the company to manage the company on their behalf.

Please see ODCE Information Booklet and Quick Guide on Company Directors

Yes. Every company is required under the Companies Act to have a minimum of two directors. The responsibility for appointing directors lies with the members and/or shareholders of the company.

The first directors of a company are the persons who gave their consent to become directors and are listed in the incorporation documents filed in the Companies Registration Office (CRO). Subsequent appointments and resignations in most companies take place at the company’s Annual General Meeting (AGM) where the members elect the directors. If a director resigns or leaves during the year, the board of directors may co-opt a person to fill the vacancy until the next AGM when the appointed person is eligible for re-election.

A company’s own Articles of Association normally set out the rules for the appointment and resignations of directors and the minimum and maximum number allowed.

Yes - generally. A company may by ordinary resolution at a meeting remove a director before the expiration of his period of office. Extended notice of 28 days is required and the director is entitled to be heard on the resolution at the meeting. If the director is the holder of the office for life he cannot be removed.

Yes. Section 45 of the Companies (Amendment)(No. 2) Act 1999, states that a person shall not be a director of more than 25 companies. However there are some exceptions to this rule, for example groups of companies are treated as one company for the purposes of this section.

No. The Companies Act requires that a company should have one director resident in the European Economic Area (EEA)  (the EU States plus Iceland, Liechtenstein and Norway). If no director is resident in the EEA, the company must hold a bond to the value of €25,395. If companies can prove they have a permanent place of business in the State they can also avoid this obligation. Details in relation to these exceptions are available on the CRO website.

Yes. ODCE and other persons such as liquidators can apply to the High Court to have a director restricted. This normally happens when a company cannot pay its debts and the directors cannot satisfy the Court that they acted honestly and responsibly in the company. Restriction orders are for a period of five years and confines a person to being a director in certain types of companies that have been adequately capitalised by their shareholders.

Yes. The High Court may disqualify anyone whom it is satisfied is guilty of fraud or is in breach of their obligations under company law, for example guilty of two or more offences of not keeping proper company books of account, or guilty of three or more company law defaults, Persons can also be disqualified if the Court finds that their behaviour makes them unfit to be a director.

Yes. Persons convicted in the Circuit Court or higher of an indictable offence relating to a company or involving fraud or dishonesty are automatically disqualified for five years from acting as company officers (directors, secretary, auditor, liquidator, etc.) Also, if a person is disqualified in another State and fails to notify the Registrar of Companies on appointment as a director they are automatically disqualified. Where a person that is restricted acts except in the circumstances allowed (company is capitalised adequately) the person is guilty of an offence and if convicted can be disqualified. And a director who allows a company to be struck off the register of companies for failing to file annual returns and that company owes money can be disqualified.

The Companies Registration Office (CRO) maintains a register of disqualified/restricted directors. You can undertake an online search to ascertain if a person is restricted/disqualified on the CRO website

Yes. Section 31 of the Companies Act 1990 prohibits a company from giving loans or quasi-loans or entering into a credit transaction as creditor or providing security guarantees to a director of the company or to a person connected with the director. There are certain exceptions to this rule and these are set out in Sections 32 to 37 of the Companies Act 1990. For more information on this topic refer to "A Guide to Transactions Involving Directors" on the ODCE website.