The new Companies Act, which is the largest piece of legislation in the history of the state, came into force this week. The new act is designed to simplify matters as 30 pieces of legislation are being distilled into one single act.
Paul Keane, chair of the Law Society of Ireland's Business Law Committee, says that the new act was 15 years in gestation - a process of consultation, development and amendment in which the Law Society has taken a very substantial part. It has a total of 1,200 pages with 1,500 sections. It also brings together legislation that was initially brought in in 1963 and Mr Keane says that while at the time it was "cutting edge", it had become something of a tangled web since then with over 30 major amendments.
The new legislation concentrates on the small private company and has reduced formalities. Mr Keane says it got rid of the "nonsense" of having to have a second nominee director in the company, in which in effect may only has one person. A number of "traps" associated with the previous form of the company is eliminated while the problem of capacity is also swept aside. The new act should make businesses more efficient, he states. A great deal of complications, which had required lawyers, are now gone. It is much more useful to be advising people on how to do things efficiently rather than how to avoid traps, he states.
But the new act also has many new rules, including the codification for the first time of a director's duties. Mr Keane says there are also new rules in relation to company secretaries - a company secretary must now have the appropriate skills and resources to do the job properly. New regulations on directors' loans have also been introduced. If directors make loans to their companies, from now on these loans have to be properly documented or otherwise in an insolvency, those loans will be treated "badly", he explains.
MORNING BRIEFS - Media group UTV has sold Juice FM, a radio station in Liverpool, to Global Radio Holdings for £10m. In a statement to the stock exchange UTV said proceeds from the sale, which is subject to approval from competition authorities in the UK, are to be used to pay down debt.
*** Aer Lingus Regional passenger numbers fell sharply in May, down 13% to 106,000 from 122,000 in the same month last year. The month was a rare blip for Aer Lingus Regional which has been for some time the fastest growing division for the airline. Short haul and long haul traffic for the Aer Lingus main operations, however, was more robust. Long haul passenger numbers were up almost 11%, underlining one of the key reasons IAG is so interested in buying Aer Lingus. In total Aer Lingus carried just over a million passengers in May, 1.5% ahead of May 2014. The figures come a day after Ryanair reported a 16% rise in May traffic after filling 92% of its seats during the month. The comparable figure for Aer Lingus is 80%.
*** Greece is using a tactic last deployed by Zambia in the 1980s to delay a €300m payment due to the International Monetary Fund today. Talks with creditors to try to hammer out a new deal that would unlock €7.2 billion worth of bailout funds finished in Brussels overnight ahead of the nominal payment deadline today, without agreement. So Greece has decided to bundle a number of sums due to the IMF in June and pay them in one lump sum at the end of the month. That came as something of a surprise, certainly to IMF who had, yesterday afternoon, expressed confidence that Greece would meet the payment. A €300m sum for an economy of Greece's size is not considered, under normal circumstances, an onerous obligation.
*** The Central Bank has handed out fines totalling €27.1m over the past four years including eight fines of over €1m. New figures, released following a parliamentary question by Sinn Féin TD Pearse Doherty, show 54 institutions have been fined during that four year period. The largest imposed was €3.5m on Ulster Bank in November last year following a serious IT problem that left many of its customers without access to basic banking facilities during summer 2012.