Every company in Ireland must have at least one EU Resident Director. For companies that don’t we can arrange a Section 137 Bond which is issued in accordance with the Companies Act 2014. The Section 137 bond is a guarantee that you will pay a specified amount of money if called upon. The company that underwrites the Section 137 bond (the guarantor) will honour the obligation to pay an agreed amount if called upon. A Section 137 bond is different to an insurance policy.

 

How is a Section 137 Bond called upon?

These particular Section 137 bonds are called upon if the company fails to pay a fine or penalty, refer to the link below for more information:

https://www.cro.ie/Portals/0/Leaflets/Leaflet%2017%20v3.2%202014%20Act.pdf

 

Brexit

With the UK now officially no longer part of the EU the transition period and provisions have commenced and will remain will be in place until 31 December 2020.

If no agreement is reached within the transition period or no extension is granted, then Irish registered companies with UK resident directors will be required to appoint an EEA resident director or obtain a Section 137 Bond or apply for Real and Continuous Link with the State.

A Section 137 Bond is a surety bond provided for € 25,000 and lasts for a 2 year period. This bond must be provided to the Companies Registration Office ( CRO) as part of the filing of the company’s accounts.

The Section 137 Non Resident Bond is a legal requirement and must be held in place once there is no EEA resident director in place. The Section 137 bond is put in place for a 2 year period and renewed bi annually thereafter.

MKIG can assist in the arrangement of a Section 137 Bond, please make contact with Fergal Kennedy fergal@mkig.ie or on 353 1 8902277 to discuss your options.