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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. Section 137 Bonds are a guarantee that you will pay a specified amount of money if called upon. The company that underwrites the bond (the guarantor) will honour the obligation to pay an agreed amount if called upon. This bond is different to an insurance policy.
How are Section 137 Bonds 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.
This bond is a legal requirement and must be held in place once there is no EEA resident director in place. Section 137 bonds are put in place for a 2 year period and renewed bi annually thereafter.
Contact Us
MKIG can assist in the arrangement of Section 137 Bonds, please make contact with Fergal Kennedy fergal@mkig.ie or call us on 353 1 890 2277 to discuss your options.
