Offences

Page Header Background

Annual Returns which are filed late with the CRO incur a late filing fee of €100 with effect from the expiry of the company’s filing deadline, with a daily late fee of €3 accruing thereafter, up to a maximum of €1,200 per return.

In addition to the late filing fee, the Registrar of Companies is empowered under law to take a number of enforcement measures in respect of those companies that file late. However, a number of companies are repeatedly paying late filing fees, so the severity of the enforcement measures to be employed by the CRO in respect of a company relates directly to that company’s annual return filing compliance history in respect of the two most recent years.

The range of enforcement actions to which your company will be exposing itself, in the event that it does not deliver this year’s Annual Return on time, together with any other Annual Return that may be outstanding, is as follows:

High Court Order
Under Section 797 of the Companies Act 2014, the Registrar is empowered, after the expiry of a period of 14 days following the issue of a notice to a company and/or its directors, if the outstanding Annual Return(s) has/have not been filed at the end of that period, to apply to the High Court for:

  • an order directing the company and any officer thereof to make good the default
    within such period as the court may specify
  • an order directing that the costs of and incidental to the application be borne by
    officers of the company responsible for the default.

 
Furthermore, this measure may be used by the Registrar to secure the filing of an outstanding return, notwithstanding the prior conviction of the company or its directors for non-filing of Annual Returns, in the event that any return remains outstanding post-conviction of the company or its directors.

On-the-Spot Fine
Under Section 874(2)(c) of the Companies Act 2014, a defaulting person or company must, within the period of 21 days following the issue of a notice of on-the-spot fine by the Registrar to that person or company:

  • Remedy the default by filing the outstanding Annual Return(s), and
  • Make to the Registrar a payment of the amount set out in the notice.

 
The defaulting person/company will be prosecuted if the terms of the on-the-spot fine notice are not complied with within the 21-day period.

Prosecution of Companies and Directors
Companies and directors of companies who fail to file an Annual Return with the CRO may be prosecuted under Section 865(2) of the Companies Act 2014. A director who has received three such convictions may be disqualified from acting as director, or having any involvement in the management, of any company.

Involuntary Strike-Off
A company, which fails to file an Annual Return in respect of any one year, may be struck off the register and dissolved. In the event that your company has an annual return outstanding, one statutory warning only is required to be issued by the CRO to the registered office of the company.

The protection of limited liability will be lost with effect from the date of strike off and any assets of the company will vest in the Minister for Public Expenditure & Reform (under the State Property Acts) by operation of law on dissolution of the company.

Furthermore, the Corporate Enforcement Authority (CEA) may apply to the High Court for an order pursuant to Section 842 of the Companies Act 2014 disqualifying the company’s directors from acting as director, or having any involvement in the management, of any company, together with an order for the legal costs incurred by the CEA in bringing such an application and the costs incurred by that Office in investigating the matter.

Because of the emphasis on the latest return, the inclusion of a company in the list for enforcement action need not concern any company that files on time in the current year. However, if your company does not file its current return on time, the nature of the enforcement measure which will be employed will be determined by reference to your company’s compliance with its return filing obligations in previous years.

Categories of Offences
The Companies Act 2014 provides for a four categories of offences, Categories 1 to 4. Throughout the Act, offences are, as created, categorised as attracting a particular category of penalty.

Section 871 of the 2014 Act sets out these penalties:

  • Category 1 offence: conviction on indictment can result in a term of imprisonment of up to 10 years or a fine of up to €500,000 or both;
  • Category 1 offence: summary conviction can result in a Class A fine or imprisonment for a term not exceeding 12 months or both;
  • Category 2 offence: conviction on indictment can result in a term of imprisonment of up to five years or a fine of up to €50,000 or both;
  • Category 2 offence: summary conviction can result in a Class A fine or imprisonment for a term not exceeding 12 months or both;
  • Category 3 offence: a summary offence only, attracting a term of imprisonment of up to six months and a Class A fine (or both); and
  • Category 4 offence: also a summary offence only, punishable by the imposition of a Class A fine.

 
A Class A fine is a fine within the meaning of the Fines Act of 2010, i.e. a fine not exceeding €5,000.