The provision in Irish legislation allowing persons who are not residents of an EEA (European Economic Area) member state to be a Director of an Irish company has been in force under the Companies (Amendment) (No.2) Act, 1999 since its enactment on 15 December 1999. 

Early Provisions

Section 43 (1) of the Act stated that at least one person who was a Director of the company must be a member of the state, although subsection (3) of the Act provided that this rule would not apply if the company held a bond in the prescribed form to the value of IR£20,000.

Section 43 was later amended by the Companies (Amendment) Act 2009 to state that at least one Director could be a resident in a Member state of the EEA, expanding the requirement from that of a Director being a resident in Ireland only. This was evidently an effort to improve the participation of Irish companies with multinational businesses across the EU. It is worth noting that when Ireland changed from Punt to the Euro, the cost of the bond after its conversion became €25,394.76 and has remained the same to date. 

Purpose Of The Bond 

The purpose of the bond is to guarantee that in the event of a company being issued a fine as a result of a breach of either the Companies Acts, or the Taxes Consolidation Act that the liability will be discharged from the bond to settle all outstanding liabilities owed to the authorities. 


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Features Of The Bond 

Bonds must have a minimum validity period of two years, commencing no earlier than the occurrence of the event giving rise to the requirement for the bond; for example, a company being incorporated with non-EEA Directors should have a bond in place at the time of applying for incorporation of their company.

The surety under the bond must be either a bank, building society, insurance company, or credit institution as specified in Schedule 2 of the Companies (Amendment)(No.2) Act 1999 Bonding Order 2000

Provision Under The Companies Act 2014

Section 43 under the old Companies Acts will be replaced on 1 June 2015 with Section 137 under the Companies Act 2014. The value of the bond under Section 137 will be reduced to €25,000, effectively rounding it down.

Its is interesting to note that Single Director private limited companies will now feature under the Companies Act 2014, these companies may also avail of Section 137 (2) and the sole Director may be from outside the EEA subject to a bond being in force. Should the non-resident Sole Director cease to be Director of the company they are obliged under Section 139 of the Act to notify the Registrar of companies of the situation within 14 days following cessation. Failure by the Director to do so may result in their liability for any fine imposed upon the company by the Registrar or Revenue Commissioners. 

Should Directors from outside the EEA wish to become a Director of an Irish company it is advisable that they seek company law advice from a registered secretarial services provider such as Corplaw so that they are fully aware of all implications regarding what is required of them and ensuring that bonds are obtained and registered properly.


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