Companies Act, 1963

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Number 33 of 1963.

COMPANIES ACT, 1963.

ARRANGEMENT OF SECTIONS

PART I

Preliminary

PART II

Incorporation of Companies and Matters Incidental Thereto

PART III

Share Capital and Debentures.

PART IV

Registration of Charges

PART V

Management and Administration

PART VI

Winding up

PART VII

Receivers

PART VIII

Application of Act to Companies Formed or Registered under former Acts

PART IX

Companies not Formed under this Act Authorised to Register under this Act.

PART X

Winding up of Unregistered Companies

PART XI

Companies Incorporated Outside the State Establishing a Place of Business Within the State

PART XII

Restrictions on Sale of Shares and Offers of Shares for Sale

PART XIII

General Provisions as to Registration

PART XIV

Miscellaneous Provisions relating to Banking Companies, Partnership and Unregistered Companies

PART XV

General

SCHEDULES.

FIRST SCHEDULE

Table A, Tábla A, and Tables B, C, D and E.

SECOND SCHEDULE.

Form of Statement in lieu of Prospectus to be delivered to Registrar by a Private Company on becoming a Public Company and Reports to be set out therein.

THIRD SCHEDULE

Matters to be specified in Prospectus and Reports to be set out therein

FOURTH SCHEDULE

Form of Statement in lieu of Prospectus to be delivered to Registrar by a Company which does not issue a Prospectus or which does not make an Allotment on a Prospectus issued, and Reports to be set out therein.

FIFTH SCHEDULE

Contents and Form of Annual Return of a Company having a Share Capital.

SIXTH SCHEDULE.

Accounts

SEVENTH SCHEDULE

Matters to be expressly stated in Auditors' Report

EIGHTH SCHEDULE.

Fees to be paid to the Registrar of Companies.

NINTH SCHEDULE.

Provisions of this Act applied to Unregistered Companies

TENTH SCHEDULE.

Provisions Referred to in Section 380

ELEVENTH SCHEDULE.

Amendments of other Acts

TWELFTH SCHEDULE.

Enactments Repealed

THIRTEENTH SCHEDULE.

Enactment Saved

Number 33 of 1963.

COMPANIES ACT, 1963.

AN ACT TO CONSOLIDATE WITH AMENDMENTS CERTAIN ENACTMENTS RELATING TO COMPANIES AND FOR PURPOSES CONNECTED WITH THAT MATTER. [23rd December, 1963.]

BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:—

PART I.

Preliminary.

Short title and commencement.

1.—(1) This Act may be cited as the Companies Act, 1963.

(2) This Act shall come into operation on such day as the Minister appoints by order.

General provisions as to interpretation.

2.—(1) In this Act unless the context otherwise requires—

“accounts” includes a company's group accounts whether prepared in the form of accounts or not;

“agent” does not include a person's counsel acting as such;

“annual return” means the return required to be made, in the case of a company having a share capital, under section 125 and, in the case of a company not having a share capital, under section 126;

“articles” means the articles of association of a company, as originally framed or as altered by special resolution, including, so far as they apply to the company, the regulations contained (as the case may be) in Table B in the Schedule annexed to the Joint Stock Companies Act, 1856, or in Table A in the First Schedule to the Companies Act, 1862 , or in that Table as altered in pursuance of section 71 of the last mentioned Act, or in Table A in the First Schedule to the Companies (Consolidation) Act, 1908 ;

“bank holiday” means a day which is a bank holiday under the Public Holidays Acts, 1871 to 1924;

“the Bankruptcy Acts” means the Irish Bankrupt and Insolvent Act, 1857, the Bankruptcy (Ireland) Amendment Act, 1872, the Debtors Act (Ireland) 1872 and the Local Bankruptcy (Ireland) Act, 1888;

“book and paper” and “book or paper” include accounts, deeds, writings and documents;

“company” means a company formed and registered under this Act, or an existing company;

“company limited by guarantee” and “company limited by shares” have the meanings assigned to them respectively by subsection (2) of section 5;

“contributory” has the meaning assigned to it by section 208;

“the court” used in relation to a company means the High Court;

“creditors' voluntary winding up” has the meaning assigned to it by subsection (7) of section 256;

“debenture” includes debenture stock, bonds and any other securities of a company whether constituting a charge on the assets of the company or not;

“director” includes any person occupying the position of director by whatever name called;

“document” includes summons, notice, order and other legal process, and registers;

“existing company” means a company formed and registered in a register kept in the State under the Joint Stock Companies Acts, the Companies Act, 1862 , or the Companies (Consolidation) Act, 1908 ;

“extended notice” has the meaning assigned to it by section 142;

“financial year” means, in relation to any body corporate, the period in respect of which any profit and loss account of the body corporate laid before it in general meeting is made up, whether that period is a year or not;

“group accounts” has the meaning assigned to it by subsection (1) of section 150;

“holding company” means a holding company as defined by section 155;

“issued generally” means, in relation to a prospectus, issued to persons who are not existing members or debenture holders of the company;

1858, c. 91.

“Joint Stock Companies Acts” means the Joint Stock Companies Act, 1856, the Joint Stock Companies Acts, 1856, 1857, the Joint Stock Banking Companies Act, 1857 and the Act to enable Joint Stock Banking Companies to be formed on the principle of limited liability, or any one or more of those Acts as the case may require, but does not include the Act 7 & 8 Victoria, Chapter 110;

“members' voluntary winding up” has the meaning assigned to it by subsection (7) of section 256;

“the minimum subscription” has the meaning assigned to it by subsection (2) of section 53;

“memorandum” means the memorandum of association of a company, as originally framed or as altered in pursuance of any statute (including this Act);

“Minister” means the Minister for Industry and Commerce;

“officer” in relation to a body corporate includes a director or secretary;

“the operative date” means the date on which this Act comes into operation;

“prescribed” means, in relation to the provisions of this Act dealing with the winding up of companies, prescribed by rules of court, and in relation to the other provisions of this Act, prescribed by order made by the Minister;

“printed” includes reproduced in any legible and durable form approved by the registrar of companies;

“private company” has the meaning assigned to it by subsection (1) of section 33;

“prospectus” means any prospectus, notice, circular, advertisement or other invitation, offering to the public for subscription or purchase any shares or debentures of a company;

“recognised stock exchange” means a stock exchange prescribed by the Minister for the purposes of each provision in which those words appear;

“the registrar of companies” or, when used in relation to registration of companies, “the registrar” means the officer performing under this Act the duty of registration of companies;

“resolution for reducing share capital” has the meaning assigned to it by subsection (3) of section 72;

“a resolution for voluntary winding up” has the meaning assigned to it by subsection (2) of section 251;

“share” means share in the share capital of a company, and includes stock except where a distinction between stock and shares is expressed or implied;

“share warrant” has the meaning assigned to it by subsection (2) of section 88;

“statutory meeting” means the meeting required to be held by subsection (1) of section 130;

“statutory report” has the meaning assigned to it by subsection (2) of section 130;

“subsidiary” means a subsidiary as defined by section 155;

“Table A” means Table A in the First Schedule;

“Tábla A” means Tábla A in the First Schedule;

“the time of the opening of the subscription lists” has the meaning assigned to it by subsection (1) of section 56;

“undischarged bankrupt” includes—

(a) a bankrupt who has not obtained the certificate of conformity mentioned in section 56 of the Bankruptcy (Ireland) Amendment Act, 1872;

(b) a person who has been adjudged bankrupt in Northern Ireland and who has not obtained the certificate of conformity mentioned in section 56 of the Bankruptcy (Ireland) Amendment Act, 1872;

(c) a person who is an undischarged bankrupt under the law of England or Scotland;

but does not include a person whose bankruptcy has been annulled;

“unlimited company” has the meaning assigned to it by subsection (2) of section 5.

(2) A person shall not be deemed to be, within the meaning of any provision of this Act, a person in accordance with whose directions or instructions the directors of a company are accustomed to act, by reason only that the directors of a company act on advice given by him in a professional capacity.

(3) References in this Act to a body corporate or to a corporation shall be construed as not including a corporation sole, but as including a company incorporated outside the State.

(4) Any provision of this Act overriding or interpreting a company's articles shall, except as provided by this Act, apply in relation to articles in force on the operative date as well as to articles coming into force thereafter, and shall apply also in relation to a company's memorandum as it applies in relation to its articles.

(5) References in this Act to any enactment shall, unless the context otherwise requires, be construed as references to that enactment as amended or extended by any subsequent enactment including this Act.

(6) In this Act, a reference to a Part, section or schedule is to a Part, section or schedule of this Act, unless it is indicated that reference to some other enactment is intended.

(7) In this Act, a reference to a subsection, paragraph, subparagraph or other division is to the subsection, paragraph, subparagraph or other division of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended.

Repeal and savings.

3.—(1) The enactments mentioned in the Twelfth Schedule are hereby repealed to the extent specified in the third column of that Schedule.

(2) Nothing in this Act shall affect any Order in Council, order, rule, regulation, appointment, conveyance, mortgage, deed or agreement made, resolution passed, direction given, proceeding taken, instrument issued or thing done under any former enactment relating to companies, but any such Order in Council, order, rule, regulation, appointment, conveyance, mortgage, deed, agreement, resolution, direction, proceeding, instrument or thing shall, if in force immediately before the operative date continue in force, and so far as it could have been made, passed, given, taken, issued or done under this Act shall have effect as if made, passed, given, taken, issued or done under this Act.

(3) Nothing in this Act shall affect the operation of sections 109 and 110 of the Companies (Consolidation) Act, 1908 , as regards inspectors appointed before, or the continuance of an inspection begun by inspectors appointed before, the operative date, and section 172 shall apply to a report of inspectors appointed under the said sections as it applies to a report of inspectors appointed under sections 165 and 166.

(4) Nothing in this Act shall affect—

(a) the provisions of section 5 of the Trade Union Act, 1871 (which avoids the registration of a trade union under the enactments relating to companies);

(b) the enactment set out in the Thirteenth Schedule, being an enactment continued in force by section 205 of the Companies Act, 1862 ,

or be construed as repealing any provision of the Insurance Acts, 1909 to 1961.

(5) Subject to the provisions of subsection (4), any document referring to any former enactment relating to companies shall be construed as referring to the corresponding enactment of this Act.

(6) Any person, appointed to any office under or by virtue of any former enactment relating to companies, who is in office immediately before the operative date shall be deemed to have been appointed to that office under or by virtue of this Act.

(7) Any register kept under any former enactment relating to companies shall be deemed part of the register to be kept under the corresponding provisions of this Act.

(8) All funds and accounts constituted under this Act shall be deemed to be in continuation of the corresponding funds and accounts constituted under the former enactments relating to companies.

(9) The repeal by this Act of any enactment shall not affect—

(a) the incorporation of any company registered under any enactment hereby repealed;

(b) Table B in the Schedule annexed to the Joint Stock Companies Act, 1856, or any part thereof, so far as the same applies to any company existing on the operative date;

(c) Table A in the First Schedule annexed to the Companies Act, 1862 , or any part thereof, either as originally contained in that Schedule or as altered in pursuance of section 71 of that Act, so far as the same applies to any company existing on the operative date;

(d) Table A of the First Schedule to the Companies (Consolidation) Act, 1908 , or any part thereof, so far as the same applies to any company existing on the operative date.

(10) Where any offence, being an offence for the continuance of which a penalty was provided, has been committed under any former enactment relating to companies, proceedings may be taken under this Act in respect of the continuance of the offence after the operative date, in the same manner as if the offence had been committed under the corresponding provisions of this Act.

(11) In this section “former enactment relating to companies” means any enactment repealed by this Act and any enactment repealed by the Companies (Consolidation) Act, 1908 .

Construction of references in other Acts to companies registered under the Companies (Consolidation) Act, 1908.

4.—Notwithstanding subsection (1) of section 20 of the Interpretation Act, 1937 , (which provides that where an Act repeals and re-enacts, with or without modification, any provisions of a former Act, references in any other Act to the provisions so repealed shall, unless the contrary intention appears, be construed as references to the provisions so re-enacted) references in any Act other than this Act to a company formed and registered, or registered, under the Companies (Consolidation) Act, 1908 , shall, unless the contrary intention appears, be construed as references to a company formed and registered, or registered, under that Act or this Act.

Part II.

Incorporation of Companies and matters incidental thereto.

Memorandum of Association.

Way of forming incorporated company.

5.—(1) Any seven or more persons or, where the company to be formed will be a private company, any two or more persons, associated for any lawful purpose may, by subscribing their names to a memorandum of association and otherwise complying with the requirements of this Act relating to registration, form an incorporated company, with or without limited liability.

(2) Such a company may be either—

(a) a company having the liability of its members limited by the memorandum to the amount, if any, unpaid on the shares respectively held by them (in this Act termed “a company limited by shares”); or

(b) a company having the liability of its members limited by the memorandum to such amount as the members may respectively thereby undertake to contribute to the assets of the company in the event of its being wound up (in this Act termed “a company limited by guarantee”); or

(c) a company not having any limit on the liability of its members (in this Act termed “an unlimited company”).

Requirements in relation to memorandum.

6.—(1) The memorandum of every company must state—

(a) the name of the company, with “limited” or “teoranta” as the last word of the name in the case of a company limited by shares or by guarantee;

(b) the objects of the company.

(2) The memorandum of a company limited by shares or by guarantee must also state that the liability of its members is limited.

(3) The memorandum of a company limited by guarantee must also state that each member undertakes to contribute to the assets of the company in the event of its being wound up while he is a member, or within one year after he ceases to be a member, for payment of the debts and liabilities of the company contracted before he ceases to be a member, and of the costs, charges and expenses of winding up, and for adjustment of the rights of the contributories among themselves, such amount as may be required, not exceeding a specified amount.

(4) In the case of a company having a share capital—

(a) the memorandum must also, unless the company is an unlimited company, state the amount of share capital with which the company proposes to be registered, and the division thereof into shares of a fixed amount;

(b) no subscriber of the memorandum may take less than one share;

(c) each subscriber must write opposite to his name the number of shares he takes.

Printing, stamp and signature of memorandum.

7.—The memorandum must be printed, must bear the same stamp as if it were a deed, and must be signed by each subscriber in the presence of at least one witness who must attest the signature.

Modification of the ultra vires rule.

8.—(1) Any act or thing done by a company which if the company had been empowered to do the same would have been lawfully and effectively done, shall, notwithstanding that the company had no power to do such act or thing, be effective in favour of any person relying on such act or thing who is not shown to have been actually aware, at the time when he so relied thereon, that such act or thing was not within the powers of the company, but any director or officer of the company who was responsible for the doing by the company of such act or thing shall be liable to the company for any loss or damage suffered by the company in consequence thereof.

(2) The court may, on the application of any member or holder of debentures of a company, restrain such company from doing any act or thing which the company has no power to do.

Restriction on alteration of memorandum.

9.—A company may not alter the provisions contained in its memorandum except in the cases, in the mode and to the extent for which express provision is made in this Act.

Way in which and extent to which objects of company may be altered.

10.—(1) Subject to subsection (2), a company may, by special resolution, alter the provisions of its memorandum by abandoning, restricting or amending any existing object or by adopting a new object and any alteration so made shall be as valid as if originally contained therein, and be subject to alteration in like manner.

(2) If an application is made to the court in accordance with this section for the alteration to be cancelled, it shall not have effect except in so far as it is confirmed by the court.

(3) Subject to subsection (4), an application under this section may be made—

(a) by the holders of not less in the aggregate than 15% in nominal value of the company's issued share capital or any class thereof or, if the company is not limited by shares, not less than 15% of the company's members; or

(b) by the holders of not less than 15% of the company's debentures, entitling the holders to object to alterations of its objects.

(4) An application shall not be made under this section by any person who has consented to or voted in favour of the alteration.

(5) An application under this section must be made within 21 days after the date on which the resolution altering the company's objects was passed, and may be made on behalf of the persons entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(6) On an application under this section, the court may make an order cancelling the alteration or confirming the alteration either wholly or in part and on such terms and conditions as it thinks fit, and may, if it thinks fit, adjourn the proceedings in order that an arrangement may be made to the satisfaction of the court for the purchase of the interests of dissentient members, and may give such directions and make such orders as it may think expedient for facilitating or carrying into effect any such arrangement so, however, that no part of the capital of the company shall be expended in any such purchase.

(7) The debentures entitling the holders to object to alterations of a company's objects shall be any debentures secured by a floating charge which were issued or first issued before the operative date or form part of the same series as any debentures so issued, and a special resolution altering a company's objects shall require the same notice to the holders of any such debentures as to members of the company, so however that not less than 10 days' notice shall be given to the holders of any such debentures.

In default of any provisions regulating the giving of notice to any such debenture holders, the provisions of the company's articles regulating the giving of notice to members shall apply.

(8) In the case of a company which is, by virtue of a licence from the Minister, exempt from the obligation to use the word “limited” or “teoranta” as part of its name, a resolution altering the company's objects shall also require the same notice to the Minister as to holders of debentures.

(9) Where a company passes a resolution altering its objects—

(a) if no application is made with respect thereto under this section, it shall, within 15 days from the end of the period for making such an application, deliver to the registrar of companies a printed copy of its memorandum as altered; and

(b) if such an application is made, it shall—

(i) forthwith give notice of that fact to the registrar; and

(ii) within 15 days from the date of any order cancelling or confirming the alteration, deliver to the registrar an office copy of the order and, in the case of an order confirming the alteration, a printed copy of the memorandum as altered.

The court may by order at any time extend the time for delivery of documents to the registrar under paragraph (b) for such period as the court may think proper.

(10) If a company makes default in giving notice or delivering any document to the registrar as required by subsection (9), the company and every officer of the company who is in default shall be liable to a fine not exceeding £50.

(11) In relation to a resolution for altering the provisions of a company's memorandum relating to the objects of the company passed before the operative date, this section shall have effect as if, in lieu of subsections (2) to (10), there had been enacted subsections (2) to (7) of section 9 of the Companies (Consolidation) Act, 1908 .

Articles of Association.

Articles prescribing regulations for companies.

11.—There may, in the case of a company limited by shares, and there shall, in the case of a company limited by guarantee or unlimited, be registered with the memorandum articles of association signed by the subscribers to the memorandum and prescribing regulations for the company.

Regulations required in the case of an unlimited company or company limited by guarantee.

12.—(1) In the case of an unlimited company, the articles must state the number of members with which the company proposes to be registered and, if the company has a share capital, the amount of share capital with which the company proposes to be registered.

(2) In the case of a company limited by guarantee, the articles must state the number of members with which the company proposes to be registered.

(3) Where an unlimited company or a company limited by guarantee has increased the number of its members beyond the registered number, it shall, within 15 days after the increase was resolved on or took place, give to the registrar notice of the increase, and he shall record the increase.

If default is made in complying with this subsection, the company and every officer of the company who is in default shall be liable to a fine not exceeding £50.

Adoption and application of Table A or Tábla A.

13.—(1) Articles of association may adopt all or any of the regulations contained in Table A, or of the equivalent regulations in the Irish language contained in Tábla A.

(2) In the case of a company limited by shares and registered after the operative date, if articles are not registered or, if articles are registered, in so far as the articles do not exclude or modify the regulations contained in Table A, those regulations shall, so far as applicable, be the regulations of the company in the same manner and to the same extent as if they were contained in duly registered articles.

(3) If the memorandum of the company is in the Irish language, the references in subsection (2) to Table A shall be construed as references to Tábla A.

Printing, stamp and signature of articles.

14.—Articles must—

(a) be printed;

(b) be divided into paragraphs numbered consecutively;

(c) bear the same stamp as if they were contained in a deed;

(d) be signed by each subscriber of the memorandum in the presence of at least one witness who must attest the signature.

Alteration of articles by special resolution.

15.—(1) Subject to the provisions of this Act and to the conditions contained in its memorandum, a company may by special resolution alter or add to its articles.

(2) Any alteration or addition so made in the articles shall, subject to the provisions of this Act, be as valid as if originally contained therein, and be subject in like manner to alteration by special resolution.

Form of Memorandum and Articles.

Statutory forms of memorandum and articles.

16.—The form of—

(a) the memorandum of a company limited by shares;

(b) the memorandum and articles of a company limited by guarantee and not having a share capital;

(c) the memorandum and articles of a company limited by guarantee and having a share capital;

(d) the memorandum and articles of an unlimited company having a share capital;

shall be respectively in accordance with the forms set out in Tables B, C, D and E in the First Schedule or as near thereto as circumstances admit.

Registration.

Registration of memorandum and articles.

17.—The memorandum and the articles, if any, shall be delivered to the registrar of companies, and he shall retain and register them.

Effect of registration.

18.—(1) On the registration of the memorandum of a company the registrar shall certify under his hand that the company is incorporated and, in the case of a limited company, that the company is limited.

(2) From the date of incorporation mentioned in the certificate of incorporation, the subscribers of the memorandum, together with such other persons as may from time to time become members of the company, shall be a body corporate with the name contained in the memorandum, capable forthwith of exercising all the functions of an incorporated company, and having perpetual succession and a common seal, but with such liability on the part of the members to contribute to the assets of the company in the event of its being wound up as is mentioned in this Act.

Conclusiveness of certificate of incorporation.

19.—(1) A certificate of incorporation, given by the registrar in respect of any association, shall be conclusive evidence that all the requirements of this Act in respect of registration and of matters precedent and incidental thereto have been complied with, and that the association is a company authorised to be registered and duly registered under this Act.

(2) A statutory declaration by a solicitor engaged in the formation of the company, or by a person named in the articles as a director or secretary of the company, of compliance with all or any of the said requirements shall be produced to the registrar, and he may accept such a declaration as sufficient evidence of compliance.

Registration of unlimited company as limited.

20.—(1) Subject to the provisions of this section, a company registered as unlimited may register under this Act as limited, or a company already registered as a limited company may re-register under this Act, but the registration of an unlimited company as a limited company shall not affect the rights or liabilities of the company in respect of any debt or obligation incurred, or any contract entered into by, to, with or on behalf of the company before the registration, and those rights or liabilities may be enforced in manner provided by Part IX of this Act in the case of a company registered in pursuance of that Part.

(2) On registration in pursuance of this section, the registrar shall close the former registration of the company, and may dispense with the delivery to him of copies of any documents with copies of which he was furnished on the occasion of the original registration of the company, but, save as aforesaid, the registration shall take place in the same manner and have effect as if it were the first registration of the company under this Act, and as if the provisions of the Acts under which the company was previously registered and regulated had been contained in different Acts from those under which the company is registered as a limited company.

Provisions relating to Names of Companies.

Prohibition of registration of companies by undesirable names.

21.—No company shall be registered by a name which, in the opinion of the Minister, is undesirable but an appeal shall lie to the court against a refusal to register.

Registration of business name.

22.—(1) Every company carrying on business under a name other than its corporate name shall register in the manner directed by law for the registration of business names.

(2) The use of the abbreviation “Ltd.” for “Limited” or “Teo.” for “Teoranta” shall not of itself render such registration necessary.

Change of name.

23.—(1) A company may, by special resolution and with the approval of the Minister signified in writing, change its name.

(2) If, through inadvertence or otherwise, a company on its first registration, or on its registration by a new name, is registered by a name which, in the opinion of the Minister, is too like the name by which a company in existence is already registered, the first-mentioned company may change its name with the sanction of the Minister and, if he so directs within 6 months of its being registered by that name, shall change it within a period of 6 weeks from the date of the direction or such longer period as the Minister may think fit to allow.

If a company makes default in complying with a direction under this subsection, it shall be liable to a fine not exceeding £100.

(3) Where a company changes its name under this section, the registrar shall enter the new name in the register in place of the former name, and shall issue a certificate of incorporation altered to meet the circumstances of the case.

(4) A change of name by a company under this section shall not affect any rights or obligations of the company, or render defective any legal proceedings by or against the company, and any legal proceedings which might have been continued or commenced against it by its former name may be continued or commenced against it by its new name.

(5) A company which was registered by a name specified by statute, may, notwithstanding anything contained in that statute, change its name in accordance with subsection (1), but if the Minister is of opinion that any other Minister is concerned in the administration of the statute which specified the name of the company he shall not approve of the change of name save after consultation with that other Minister.

(6) Where the winding up of a company commences within one year after the company has changed its name, the former name as well as the existing name of the company shall appear on all notices and advertisements in relation to the winding up.

Power to dispense with “limited” or “teoranta” in name of charitable and other companies.

24.—(1) Where it is proved to the satisfaction of the Minister that an association about to be formed as a limited company is to be formed for promoting commerce, art, science, religion, charity or any other useful object, and intends to apply its profits, if any, or other income, in promoting its objects, and to prohibit the payment of any dividend to its members, the Minister may by licence direct that the association may be registered as a company with limited liability, without the addition of the word “limited” or the word “teoranta” to its name, and the association may be registered accordingly and shall, on registration, enjoy all the privileges and (subject to the provisions of this section) be subject to all the obligations of limited companies.

(2) Where it is proved to the satisfaction of the Minister—

(a) that the objects of a company registered as a limited company are restricted to those specified in subsection (1) and to objects incidental or conducive thereto; and

(b) that, by its constitution, the company is required to apply its profits, if any, or other income in promoting its objects, and is prohibited from paying any dividend to its members;

the Minister may by licence authorise the company to make, by special resolution, a change in its name, including or consisting of the omission of the word “limited” or “teoranta” and subsections (3) and (4) of section 23 shall apply to a change of name under this subsection as they apply to a change of name under that section.

(3) A licence by the Minister under this section may be granted on such conditions as the Minister thinks fit, and those conditions shall be binding on the body to which the licence is granted, and (where the grant is under subsection (1)) shall, if the Minister so directs, be inserted in the memorandum and articles or in one of those documents.

(4) A body in respect of which a licence under this section is in force shall be exempt from the provisions of this Act relating to the use of the words “limited” or “teoranta” as any part of its name, and the publishing of its name.

(5) A licence under this section may, at any time, be revoked by the Minister and, upon revocation, the registrar shall enter the word “limited” or “teoranta” at the end of the name upon the register of the body to which it was granted.

(6) Before a licence is revoked by virtue of subsection (5), the Minister shall give to the body notice in writing of his intention, and shall afford it an opportunity of being heard in opposition to the revocation.

(7) Where a body, in respect of which a licence under this section is in force, alters the provisions of its memorandum relating to its objects, the Minister may (unless he sees fit to revoke the licence) vary the licence by making it subject to such conditions as the Minister thinks fit, in lieu of or in addition to the conditions, if any, to which the licence was formerly subject.

(8) Where a licence, granted under this section to a body the name of which contains the words “chamber of commerce,” is revoked, the body shall, within a period of 6 weeks from the date of revocation or such longer period as the Minister may think fit to allow, change its name to a name which does not contain those words, and—

(a) the notice to be given under subsection (6) to that body shall include a statement of the effect of the foregoing provisions of this subsection, and

(b) subsections (3) and (4) of section 23 shall apply to a change of name under this subsection as they apply to a change of name under that section.

If the body makes default in complying with the requirements of this subsection, it shall be liable to a fine not exceeding £100.

General Provisions relating to Memorandum and Articles.

Effect of memorandum and articles.

25.—(1) Subject to the provisions of this Act, the memorandum and articles shall, when registered, bind the company and the members thereof to the same extent as if they respectively had been signed and sealed by each member, and contained covenants by each member to observe all the provisions of the memorandum and of the articles.

(2) All money payable by any member to the company under the memorandum or articles shall be a debt due from him to the company.

(3) An action to recover a debt created by this section shall not be brought after the expiration of 12 years from the date on which the cause of action accrued.

Provisions as to memorandum and articles of company limited by guarantee.

26.—(1) In the case of a company limited by guarantee and not having a share capital, and registered on or after the 1st day of January, 1901, every provision in the memorandum or articles, or in any resolution of the company, purporting to give any person a right to participate in the divisible profits of the company, otherwise than as a member, shall be void.

(2) For the purpose of the provisions of this Act relating to the memorandum of a company limited by guarantee and of this section, every provision in the memorandum or articles, or in any resolution, of a company limited by guarantee and registered on or after the date aforesaid, purporting to divide the undertaking of the company into shares or interests, shall be treated as a provision for a share capital, notwithstanding that the nominal amount or number of the shares or interests is not specified thereby.

Alterations in memorandum or articles increasing liability to contribute to share capital not to bind existing members without consent.

27.— (1) Subject to subsection (2), and notwithstanding anything in the memorandum or articles of a company, no member of the company shall be bound by an alteration made in the memorandum or articles after the date on which he became a member, if and so far as the alteration requires him to take or subscribe for more shares than the number held by him at the date on which the alteration is made, or in any way increases his liability as at that date to contribute to the share capital of, or otherwise to pay money to, the company.

(2) Subsection (1) shall not apply in any case where the member agrees in writing, either before or after the alteration is made, to be bound thereby.

Power to alter provisions in memorandum which could have been contained in articles.

28.—(1) Subject to subsection (2) and sections 27 and 205, any provision contained in a company's memorandum which could lawfully have been contained in articles of association instead of in the memorandum may, subject to the provisions of this section, be altered by the company by special resolution.

(2) If an application is made to the court for the alteration to be cancelled, it shall not have effect except in so far as it is confirmed by the court.

(3) This section shall not apply where the memorandum itself provides for or prohibits the alteration of all or any of the said provisions, and shall not authorise any variation or abrogation of the special rights of any class of members.

(4) Subsections (3), (4), (5), (6), (9) and (10) of section 10 (except paragraph (b) of the said subsection (3)) shall apply in relation to any alteration and to any application made under this section as they apply in relation to alterations and to applications made under that section.

(5) This section shall apply to a company's memorandum whether registered before, on or after the operative date.

Copies of memorandum and articles to be given to members.

29.—(1) A company shall, on being so required by any member, send to him a copy of the memorandum and of the articles, if any, and a copy of any Act of the Oireachtas which alters the memorandum, subject to payment in the case of a copy of the memorandum and of the articles, of 5/– or such less sum as the company may prescribe, and, in the case of a copy of such Act, of such sum not exceeding the published price thereof as the company may require.

(2) If a company makes default in complying with this section, the company and every officer of the company who is in default shall be liable for each offence to a fine not exceeding £5.

Issued copies of memorandum to embody alterations.

30.—(1) Where an alteration is made in the memorandum of a company, every copy of the memorandum issued after the date of the alteration shall be in accordance with the alteration.

(2) If, where any such alteration has been made, the company at any time after the date of the alteration issues to any person any copy of the memorandum which is not in accordance with the alteration, it shall be liable to a fine not exceeding £25, and every officer of the company who is in default shall be liable to the like penalty.

Membership of Company.

Definition of member.

31.—(1) The subscribers of the memorandum of a company shall be deemed to have agreed to become members of the company, and, on its registration, shall be entered as members in its register of members.

(2) Every other person who agrees to become a member of a company, and whose name is entered in its register of members, shall be a member of the company.

Membership of holding company.

32.—(1) Subject to the provisions of this section, a body corporate cannot be a member of a company which is its holding company, and any allotment or transfer of shares in a company to its subsidiary shall be void.

(2) Nothing in this section shall apply where the subsidiary is concerned as personal representative, or where it is concerned as trustee, unless the holding company or a subsidiary thereof is beneficially interested under the trust and is not so interested only by way of security for the purposes of a transaction entered into by it in the ordinary course of a business which includes the lending of money.

(3) This section shall not prevent a subsidiary which on the 5th day of May, 1959, was a member of its holding company, from continuing to be a member.

(4) This section shall not prevent a company which at the date on which it becomes a subsidiary of another company is a member of that other company, from continuing to be a member.

(5) This section shall not prevent a subsidiary which is a member of its holding company from accepting and holding further shares in the capital of its holding company if such further shares are allotted to it in consequence of a capitalisation by such holding company and if the terms of such capitalisation are such that the subsidiary is not thereby involved in any obligation to make any payment or to give other consideration for such further shares.

(6) Subject to subsection (2), a subsidiary which is a member of its holding company shall have no right to vote at meetings of the holding company or any class of members thereof.

(7) Subject to subsection (2), this section shall apply in relation to a nominee for a body corporate which is a subsidiary, as if references therein to such a body corporate included references to a nominee for it.

(8) Where a holding company makes an offer of shares to its members it may sell, on behalf of a subsidiary, any such shares which the subsidiary could, but for this section, have taken by virtue of shares already held by it in the holding company, and pay the proceeds of sale to the subsidiary.

(9) In relation to a company limited by guarantee, or unlimited, which is a holding company, the reference in this section to shares, whether or not it has a share capital, shall be construed as including a reference to the interests of its members as such, whatever the form of that interest.

Private Companies.

Meaning of “private company.”

33.—(1) For the purposes of this Act, “private company” means a company which has a share capital and which, by its articles—

(a) restricts the right to transfer its shares, and

(b) limits the number of its members to fifty, not including persons who are in the employment of the company and persons who, having been formerly in the employment of the company, were, while in that employment, and have continued after the determination of that employment to be, members of the company, and

(c) prohibits any invitation to the public to subscribe for any shares or debentures of the company.

(2) Where two or more persons hold one or more shares in a company jointly, they shall, for the purposes of this section, be treated as a single member.

Consequences of default in complying with conditions constituting a company a private company.

34.—(1) Subject to subsection (2), where the articles of a company include the provisions which, under section 33, are required to be included in the articles of a company in order to constitute it a private company, but default is made in complying with any of those provisions, the company shall cease to be entitled to the privileges and exemptions conferred on private companies under section 36, paragraph (a) of subsection (4) of section 128, paragraph (d) of section 213, and subparagraph (i) of paragraph (a) of section 215, and thereupon, sections 36, 128, 213 and 215 shall apply to the company as if it were not a private company.

(2) The court, on being satisfied that the failure to comply with the conditions was accidental or due to inadvertence or to some other sufficient cause, or that, on other grounds, it is just and equitable to grant relief, may, on the application of the company, or any other person interested, and on such terms and conditions as seem to the court just and expedient, order that the company be relieved from the consequences referred to in subsection (1).

Statement in lieu of prospectus to be delivered to registrar by company on ceasing to be a private company.

35.—(1) Subject to subsection (2), if a company, being a private company, alters its articles in such manner that they no longer include the provisions which, under section 33, are required to be included in the articles of a company in order to constitute it a private company, the company shall, on the date of the alteration, cease to be a private company and shall, within a period of 14 days after the said date, deliver to the registrar of companies for registration a statement in lieu of prospectus, in the form and containing the particulars set out in Part I of the Second Schedule, and, in the cases mentioned in Part II of that Schedule, setting out the reports specified therein, and the said Parts I and II shall have effect subject to the provisions contained in Part III of that Schedule.

(2) A statement in lieu of prospectus need not be delivered under subsection (1) if, within the said period of 14 days, a prospectus relating to the company which complies, or is deemed by virtue of a certificate of exemption under section 45 of this Act to comply, with the Third Schedule, is issued and is delivered to the registrar of companies as required by section 47.

(3) Every statement in lieu of prospectus delivered under subsection (1) shall, where the persons making any such report as referred to in that subsection have made therein or have, without giving the reasons, indicated therein any such adjustments as are mentioned in paragraph 5 of Part III of the Second Schedule, have endorsed thereon or attached thereto a written statement signed by those persons, setting out the adjustments and giving the reasons therefor.

(4) If default is made in complying with subsection (1) or (3), the company and every officer of the company who is in default shall be liable to a fine not exceeding £100.

(5) Where a statement in lieu of prospectus, delivered to the registrar under subsection (1) includes any untrue statement, any person who authorised the delivery of the statement in lieu of prospectus for registration shall be liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine not exceeding £500, or both, or

(b) on summary conviction, to imprisonment for a term not exceeding 6 months or a fine not exceeding £100, or both;

unless he proves either that the untrue statement was immaterial or that he had reasonable ground to believe and did, up to the time of the delivery for registration of the statement in lieu of prospectus, believe that the untrue statement was true.

(6) For the purposes of this section—

(a) a statement included in a statement in lieu of prospectus shall be deemed to be untrue if it is misleading in the form and context in which it is included, and

(b) a statement shall be deemed to be included in a statement in lieu of prospectus if it is contained therein or in any report or memorandum appearing on the face thereof, or by reference incorporated therein.

Reduction of Number of Members below Legal Minimum.

Members severally liable for debts where business carried on with fewer than seven, or in case of private company, two members.

36.—If at any time the number of members of a company is reduced, in the case of a private company, below two, or, in the case of any other company, below seven, and it carries on business for more than 6 months while the number is so reduced, every person who is a member of the company during the time that it so carries on business after those 6 months and knows that it is carrying on business with fewer than two members, or seven members, as the case may be, shall be severally liable for the payment of the whole debts of the company contracted during that time, and may be severally sued therefor.

Contracts, Deeds and Powers of Attorney.

Pre-incorporation contracts.

37.—(1) Any contract or other transaction purporting to be entered into by a company prior to its formation or by any person on behalf of the company prior to its formation may be ratified by the company after its formation and thereupon the company shall become bound by it and entitled to the benefit thereof as if it had been in existence at the date of such contract or other transaction and had been a party thereto.

(2) Prior to ratification by the company the person or persons who purported to act in the name or on behalf of the company shall in the absence of express agreement to the contrary be personally bound by the contract or other transaction and entitled to the benefit thereof.

(3) This section shall not apply to a company incorporated before the operative date.

Form of contracts.

38.—(1) Contracts on behalf of a company may be made as follows:

(a) a contract which if made between private persons would be by law required to be in writing and to be under seal, may be made on behalf of the company in writing under the common seal of the company;

(b) a contract which if made between private persons would be by law required to be in writing, signed by the parties to be charged therewith, may be made on behalf of the company in writing, signed by any person acting under its authority, express or implied;

(c) a contract which if made between private persons would by law be valid although made by parol only, and not reduced into writing may be made by parol on behalf of the company by any person acting under its authority, express or implied.

(2) A contract made according to this section shall bind the company and its successors and all other parties thereto.

(3) A contract made according to this section may be varied or discharged in the same manner in which it is authorised by this section to be made.

Bills of exchange and promissory notes.

39.—A bill of exchange or promissory note shall be deemed to have been made, accepted or endorsed on behalf of a company, if made, accepted or endorsed in the name of or by or on behalf or on account of, the company by any person acting under its authority.

Execution of deeds outside the State.

40.—(1) A company may, by writing under its common seal, empower any person, either generally or in respect of any specified matters, as its attorney, to execute deeds on its behalf in any place outside the State.

(2) A deed signed by such attorney on behalf of the company and under his seal shall bind the company and have the same effect as if it were under its common seal.

Power for company to have official seal for use abroad.

41.—(1) A company whose objects require or comprise the transaction of business outside the State may, if authorised by its articles, have for use in any territory, district or place not situate in the State, an official seal which shall be a facsimile of the common seal of the company with the addition on its face of the name of every territory, district or place where it is to be used.

(2) A deed or other document to which an official seal is duly affixed shall bind the company as if it had been sealed with the common seal of the company.

(3) A company having an official seal for use in any such territory, district or place, may, by writing under its common seal, authorise any person appointed for the purpose in that territory, district or place to affix the official seal to any deed or other document to which the company is party in that territory, district or place.

(4) The authority of any such agent shall, as between the company and any person dealing with the agent, continue during the period, if any, mentioned in the instrument conferring the authority, or, if no period is there mentioned, then until the notice of revocation or determination of the agent's authority has been given to the person dealing with him.

(5) The person affixing any such official seal shall, by writing under his hand, certify on the deed or other instrument to which the seal is affixed the date on which and the place at which it is affixed.

Authentication of Documents.

Authentication of documents.

42.—A document or proceeding requiring authentication by a company may be signed by a director, secretary or other authorised officer of the company, and need not be under its common seal.

PART III.

Share Capital and Debentures.

Prospectus.

Dating of prospectus.

43.—A prospectus issued by or on behalf of a company or in relation to an intended company shall be dated, and that date shall, unless the contrary is proved, be taken as the date of publication of the prospectus.

Matters to be stated and reports to be set out in prospectus.

44.—(1) Subject to the provisions of section 45, every prospectus issued by or on behalf of a company, or by or on behalf of any person who is or has been engaged or interested in the formation of the company, must state the matters specified in Part I of the Third Schedule, and set out the reports specified in Part II of that Schedule, and the said Parts I and II shall have effect subject to the provisions contained in Part III of that Schedule.

(2) A condition requiring or binding an applicant for shares in or debentures of a company to waive compliance with any requirement of this section, or purporting to affect him with notice of any contract, document or matter not specifically referred to in the prospectus shall be void.

(3) Subject to subsection (4) and section 45, it shall not be lawful to issue any form of application for shares in or debentures of a company, unless the form is issued with a prospectus which complies with the requirements of this Part and the issue of which does not contravene the provisions of section 46.

(4) Subsection (3) shall not apply if it is shown that the form of application was issued either—

(a) in connection with a bona fide invitation to a person to enter into an underwriting agreement with respect to the shares or debentures; or

(b) in relation to shares or debentures which were not offered to the public.

(5) Subject to subsection (6), in the event of noncompliance with or contravention of any of the requirements of this section, a director or other person responsible for the prospectus shall not incur any liability by reason of the noncompliance or contravention, if—

(a) as regards any matter not disclosed, he proves that he did not know it; or

(b) he proves that the noncompliance or contravention arose from an honest mistake of fact on his part; or

(c) the noncompliance or contravention was in respect of matters which in the opinion of the court dealing with the case were immaterial or was otherwise such as ought, in the opinion of the court, having regard to all the circumstances of the case, reasonably to be excused.

(6) In the event of failure to include in a prospectus a statement relating to the matters specified in paragraph 16 of the Third Schedule, no director or other person shall incur any liability in respect of the failure, unless it be proved that he had knowledge of the matters not disclosed.

(7) This section shall not apply—

(a) to the issue to existing members or debenture holders of a company of a prospectus or form of application relating to shares in or debentures of the company, whether an applicant for the shares or debentures will or will not have the right to renounce in favour of other persons; or

(b) to the issue of a prospectus or form of application relating to shares or debentures which are or are to be in all respects uniform with shares or debentures issued within the preceding 2 years and, for the time being, dealt in or quoted on a recognised stock exchange;

but, subject as aforesaid, this section shall apply to a prospectus or a form of application whether issued on or with reference to the formation of a company or subsequently.

(8) If any person acts in contravention of subsections (1) or (3) he shall be liable to a fine not exceeding £100.

(9) Nothing in this section shall limit or diminish any liability which any person may incur under the general law or this Act apart from this section.

Exclusion of section 44 and relaxation of Third Schedule in case of certain prospectuses.

45.—(1) Where—

(a) it is proposed to offer any shares in or debentures of a company to the public by a prospectus issued generally (that is, issued to persons who are not existing members or debenture holders of the company); and

(b) application is made to a recognised stock exchange for permission for those shares or debentures to be dealt in or quoted on that stock exchange;

there may, on the request of the applicant, be given by or on behalf of that stock exchange a certificate of exemption, that is, a certificate that, having regard to the proposals (as stated in the request) as to the size and other circumstances of the issue of shares or debentures and as to any limitations on the number and class of persons to whom the offer is to be made, compliance with the requirements of the Third Schedule would be unduly burdensome.

(2) If a certificate of exemption is given, and if the proposals aforesaid are adhered to and the particulars and information required to be published in connection with the application for permission made to the stock exchange are so published, then—

(a) a prospectus giving the particulars and information aforesaid in the form in which they are so required to be published shall be deemed to comply with the requirements of the Third Schedule;

(b) subject to paragraph (c), section 44 shall not apply to any issue, after the permission applied for is granted, of a prospectus relating to the shares or debentures; and

(c) subsection (3) of section 44 shall apply to any issue, after the permission applied for is granted, of a form of application relating to the shares or debentures as if the reference to a prospectus were a reference to a prospectus giving the particulars and information aforesaid in the form in which they are so required to be published.

Expert's consent to issue of prospectus containing statement by him.

46.—(1) A prospectus inviting persons to subscribe for shares in or debentures of a company and including a statement purporting to be made by an expert shall not be issued unless—

(a) he has given and has not, before delivery of a copy of the prospectus for registration, withdrawn his written consent to the issue thereof with the statement included in the form and context in which it is included;

(b) a statement that he has given and has not withdrawn his consent as aforesaid appears in the prospectus.

(2) If any prospectus is issued in contravention of this section the company and every person who is knowingly a party to the issue thereof shall be liable to a fine not exceeding £100.

(3) In this section “expert” includes engineer, valuer, accountant and any other person whose profession gives authority to a statement made by him.

Registration of prospectus.

47.—(1) No prospectus shall be issued by or on behalf of a company or in relation to an intended company unless, on or before the date of its publication, there has been delivered to the registrar for registration a copy thereof signed by every person who is named therein as a director or proposed director of the company, or by his agent authorised in writing, and having endorsed thereon or attached thereto—

(a) any consent to the issue of the prospectus required by section 46 from any person as an expert; and

(b) in the case of a prospectus issued generally, also—

(i) a copy of any contract required by paragraph 14 of the Third Schedule to be stated in the prospectus or, in the case of a contract not reduced into writing, a memorandum giving full particulars thereof or, if in the case of a prospectus deemed by virtue of a certificate granted under section 45 to comply with the requirements of that Schedule, a contract or a copy thereof or a memorandum of a contract is required to be available for inspection in connection with the application made under that section to a recognised stock exchange a copy or, as the case may be, a memorandum of that contract; and

(ii) where the persons making any report required by Part II of that Schedule have made therein, or have, without giving the reasons, indicated therein, any such adjustments as are mentioned in paragraph 29 of that Schedule, a written statement signed by those persons setting out the adjustments and giving the reasons therefor.

The references in subparagraph (i) of paragraph (b) of this subsection to the copy of a contract required thereby to be endorsed on or attached to a copy of the prospectus shall, in the case of a contract wholly or partly in a foreign language, be taken as references to a copy of a translation of the contract in English or Irish or a copy embodying a translation in English or Irish of the parts in a foreign language, as the case may be, being a translation certified in the prescribed manner to be a correct translation, and the reference to a copy of a contract required to be available for inspection shall include a reference to a copy of a translation thereof or a copy embodying a translation of parts thereof.

(2) Every prospectus shall, on the face of it,—

(a) state that a copy has been delivered for registration as required by this section;

(b) specify, or refer to statements included in the prospectus which specify, any documents required by this section to be endorsed on or attached to the copy so delivered.

(3) The registrar shall not register a prospectus unless it is dated and the copy thereof signed in manner required by this section and unless it has endorsed thereon or attached thereto the documents (if any) specified as aforesaid.

(4) If a prospectus is issued without a copy thereof being delivered under this section to the registrar or without the copy so delivered having endorsed thereon or attached thereto the required documents, the company, and every person who is knowingly a party to the issue of the prospectus, shall be liable to a fine not exceeding £100.

Restriction on alteration of terms mentioned in prospectus or statement in lieu of prospectus.

48.—(1) A company limited by shares or a company limited by guarantee and having a share capital shall not prior to the statutory meeting vary the terms of a contract referred to in the prospectus, or statement in lieu of prospectus, except subject to the approval of the statutory meeting.

(2) This section shall not apply to a private company.

Civil liability for mis-statements in prospectus.

49.—(1) Subject to the provisions of this section, where a prospectus invites persons to subscribe for shares in or debentures of a company, the following persons shall be liable to pay compensation to all persons who subscribe for any shares or debentures on the faith of the prospectus for the loss or damage they may have sustained by reason of any untrue statement included therein—

(a) every person who is a director of the company at the time of the issue of the prospectus;

(b) every person who has authorised himself to be named and is named in the prospectus as a director or as having agreed to become a director either immediately or after an interval of time;

(c) every person being a promoter of the company;

(d) every person who has authorised the issue of the prospectus.

(2) Where, under section 46, the consent of a person is required to the issue of a prospectus and he has given that consent, he shall not by reason of his having given it be liable under subsection (1) as a person who has authorised the issue of the prospectus except in respect of an untrue statement purporting to be made by him as an expert.

(3) Subject to subsection (4), no person shall be liable under subsection (1) if he proves—

(a) that, having consented to become a director of the company, he withdrew his consent before the issue of the prospectus, and that it was issued without his authority or consent; or

(b) that the prospectus was issued without his knowledge or consent, and that on becoming aware of its issue he forthwith gave reasonable public notice that it was issued without his knowledge or consent; or

(c) that after the issue of the prospectus and before allotment thereunder, he, on becoming aware of any untrue statement therein, withdrew his consent thereto and gave reasonable public notice of the withdrawal and of the reason therefor; or

(d) that—

(i) as regards every untrue statement not purporting to be made on the authority of an expert or of a public official document or statement, he had reasonable ground to believe, and did up to the time of the allotment of the shares or debentures as the case may be, believe, that the statement was true; and

(ii) as regards every untrue statement purporting to be a statement by an expert or contained in what purports to be a copy of or extract from a report or valuation of an expert it fairly represented the statement, or was a correct and fair copy of or extract from the report or valuation, and he had reasonable ground to believe and did up to the time of the issue of the prospectus believe that the person making the statement was competent to make it and that person had given the consent required by section 46 to the issue of the prospectus and had not withdrawn that consent before delivery of a copy of the prospectus for registration or, to the defendant's knowledge, before allotment thereunder; and

(iii) as regards every untrue statement purporting to be a statement made by an official person or contained in what purports to be a copy of or extract from a public official document, it was a correct and fair representation of the statement or copy of or extract from the document.

(4) Subsection (3) shall not apply in the case of a person liable, by reason of his having given a consent required of him by the said section 46, as a person who has authorised the issue of the prospectus in respect of an untrue statement purporting to be made by him as an expert.

(5) A person who, apart from this subsection would under subsection (1) be liable, by reason of his having given a consent required of him by section 46, as a person who has authorised the issue of a prospectus in respect of an untrue statement purporting to be made by him as an expert shall not be so liable if he proves—

(a) that, having given his consent under the said section 46 to the issue of the prospectus, he withdrew it in writing before delivery of a copy of the prospectus for registration; or

(b) that, after delivery of a copy of the prospectus for registration and before allotment thereunder, he, on becoming aware of the untrue statement, withdrew his consent in writing and gave reasonable public notice of the withdrawal, and of the reason therefor; or

(c) that he was competent to make the statement and that he had reasonable ground to believe and did up to the time of the allotment of the shares or debentures, as the case may be, believe that the statement was true.

(6) Subject to subsection (7), where—

(a) the prospectus contains the name of a person as a director of the company, or as having agreed to become a director thereof, and he has not consented to become a director, or has withdrawn his consent before the issue of the prospectus, and has not authorised or consented to the issue thereof; or

(b) the consent of a person is required under section 46 to the issue of the prospectus and he either has not given that consent or has withdrawn it before the issue of the prospectus;

the directors of the company, except any without whose knowledge or consent the prospectus was issued, and any other person who authorised the issue thereof shall be liable to indemnify the person named as aforesaid or whose consent was required as aforesaid, as the case may be, against all damages, costs and expenses to which he may be made liable by reason of his name having been inserted in the prospectus or of the inclusion therein of a statement purporting to be made by him as an expert, as the case may be, or in defending himself against any action or legal proceeding brought against him in respect thereof.

(7) A person shall not be deemed for the purposes of subsection (6) to have authorised the issue of a prospectus by reason only of his having given the consent required by section 46 to the inclusion therein of a statement purporting to be made by him as an expert.

(8) For the purposes of this section—

(a) “promoter” means a promoter who was a party to the preparation of the prospectus, or of the portion thereof containing the untrue statement, but does not include any person by reason of his acting in a professional capacity for persons engaged in procuring the formation of the company; and

(b) “expert” has the same meaning as in section 46.

Criminal liability for mis-statements in prospectus.

50.—(1) Where a prospectus issued after the operative date includes any untrue statement, any person who authorised the issue of the prospectus shall be liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years, or a fine not exceeding £500, or both; or

(b) on summary conviction, to imprisonment for a term not exceeding 6 months, or a fine not exceeding £100, or both;

unless he proves either that the statement was immaterial or that he had reasonable ground to believe and did, up to the time of the issue of the prospectus, believe that the statement was true.

(2) A person shall not be deemed for the purposes of this section to have authorised the issue of a prospectus by reason only of his having given the consent required by section 46 to the inclusion therein of a statement purporting to be made by him as an expert.

Document containing offer of shares or debentures for sale to be deemed a prospectus.

51.—(1) Where a company allots or agrees to allot any shares in or debentures of the company with a view to all or any of those shares or debentures being offered for sale to the public, any document by which the offer for sale to the public is made shall for all purposes be deemed to be a prospectus issued by the company, and all enactments and rules of law as to the contents of prospectuses and to liability in respect of statements in and omissions from prospectuses and as to forms of application for shares in or debentures of the company or otherwise relating to prospectuses, shall apply and have effect accordingly, as if the shares or debentures had been offered to the public for subscription and as if persons accepting the offer in respect of any shares or debentures were subscribers for those shares or debentures, but without prejudice to the liability, if any, of the persons by whom the offer is made, in respect of mis-statements contained in the document or otherwise in respect thereof.

(2) For the purposes of this Act, it shall, unless the contrary is proved, be evidence that an allotment of, or an agreement to allot, shares or debentures was made with a view to the shares or debentures being offered for sale to the public if it is shown—

(a) that an offer of shares or debentures or of any of them for sale to the public was made within 2 years after the allotment or agreement to allot; or

(b) that at the date when the offer was made the whole consideration to be received by the company in respect of the shares or debentures had not been so received.

(3) Section 44 as applied by this section shall have effect as if it required a prospectus to state in addition to the matters required by that section to be stated in a prospectus—

(a) the net amount of the consideration received or to be received by the company in respect of the shares or debentures to which the offer relates, and

(b) the place and time at which the contract under which the said shares or debentures have been or are to be allotted may be inspected;

and section 47 as applied by this section shall have effect as though the persons making the offer were persons named in a prospectus as directors of a company.

(4) Where a person making an offer to which this section relates is a company or a firm, it shall be sufficient if the document aforesaid is signed on behalf of the company or firm by two directors of the company or not less than half of the partners, as the case may be, and any such director or partner may sign by his agent authorised in writing.

Interpretation of provisions relating to prospectuses.

52.—For the purposes of the foregoing provisions of this Part—

(a) a statement included in a prospectus shall be deemed to be untrue if it is misleading in the form and context in which it is included; and

(b) a statement shall be deemed to be included in a prospectus if it is contained therein or in any report or memorandum appearing on the face thereof or by reference incorporated therein or issued therewith.

Allotment.

Minimum subscription and amount payable on application.

53.—(1) No allotment shall be made of any share capital of a company offered to the public for subscription unless the amount stated in the prospectus as the minimum amount which, in the opinion of the directors, must be raised by the issue of share capital in order to provide for the matters specified in paragraph 4 of the Third Schedule has been subscribed, and the sum payable on application for the amount so stated has been paid to and received by the company.

For the purposes of this subsection, a sum shall be deemed to have been paid to and received by the company if a cheque for that sum has been received in good faith by the company and the directors of the company have no reason for suspecting that the cheque will not be paid.

(2) The amount so stated in the prospectus shall be reckoned exclusively of any amount payable otherwise than in cash and is in this Act referred to as “the minimum subscription”.

(3) The amount payable on application on each share shall not be less than 5 per cent. of the nominal amount of the share.

(4) If the conditions aforesaid have not been complied with on the expiration of 40 days after the first issue of the prospectus, all money received from applicants for shares shall be forthwith repaid to them without interest, and, if any such money is not so repaid within 48 days after the issue of the prospectus, the directors of the company shall be jointly and severally liable to repay that money with interest at the rate of 5 per cent. per annum from the expiration of the forty-eighth day, so however that a director shall not be liable if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part.

(5) Any condition requiring or binding any applicant for shares to waive compliance with any requirement of this section shall be void.

(6) This section, except subsection (3) thereof, shall not apply to any allotment of shares subsequent to the first allotment of shares offered to the public for subscription.

Prohibition of allotment in certain cases unless statement in lieu of prospectus delivered to registrar.

54.—(1) A company having a share capital which does not issue a prospectus on or with reference to its formation, or which has issued such a prospectus but has not proceeded to allot any of the shares offered to the public for subscription, shall not allot any of its shares or debentures unless at least 3 days before the first allotment of either shares or debentures there has been delivered to the registrar of companies for registration a statement in lieu of prospectus signed by every person who is named therein as a director or a proposed director of the company or by his agent authorised in writing, in the form and containing the particulars set out in Part I of the Fourth Schedule and, in the cases mentioned in Part II of that Schedule, setting out the reports specified therein, and the said Parts I and II shall have effect subject to the provisions contained in Part III of that Schedule.

(2) Every statement in lieu of prospectus delivered under subsection (1) shall, where the persons making any such report as aforesaid have made therein or have, without giving the reasons, indicated therein any such adjustments as are mentioned in paragraph 5 of Part III of the Fourth Schedule, have endorsed thereon or attached thereto a written statement signed by those persons setting out the adjustments and giving the reasons therefor.

(3) This section shall not apply to a private company.

(4) If a company acts in contravention of subsections (1) or (2), the company and every director of the company who knowingly and wilfully authorises or permits the contravention shall be liable to a fine not exceeding £100.

(5) Where a statement in lieu of prospectus delivered to the registrar of companies under subsection (1) includes any untrue statement, any person who authorised the delivery of the statement in lieu of prospectus for registration shall be liable—

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine not exceeding £500, or both; or

(b) on summary conviction, to imprisonment for a term not exceeding 6 months or a fine not exceeding £100, or both;

unless he proves either that the untrue statement was immaterial or that he had reasonable ground to believe and did up to the time of the delivery for registration of the statement in lieu of prospectus believe that the untrue statement was true.

(6) For the purposes of this section—

(a) a statement included in a statement in lieu of prospectus shall be deemed to be untrue if it is misleading in the form and context in which it is included;

(b) a statement shall be deemed to be included in a statement in lieu of prospectus if it is contained therein or in any report or memorandum appearing on the face thereof or by reference incorporated therein.

Effect of irregular allotment.

55.—(1) An allotment made by a company to an applicant in contravention of sections 53 or 54 shall be voidable at the instance of the applicant within one month after the holding of the statutory meeting of the company and not later, or, in any case where the company is not required to hold a statutory meeting, or where the allotment is made after the holding of the statutory meeting, within one month after the date of the allotment, and not later, and shall be so voidable notwithstanding that the company is in course of being wound up.

(2) Where an allotment is avoided under this section the company shall within one month thereafter deliver to the registrar of companies for registration a notice to that effect, and subsections (3) and (4) of section 58 shall apply in relation to this subsection as they apply in relation to that section.

(3) If any director of a company knowingly contravenes, or permits or authorises the contravention of, any of the provisions of the said sections 53 and 54 with respect to allotment, he shall be liable to compensate the company and the allottee respectively for any loss, damages or costs which the company or allottee may have sustained or incurred thereby, so however that proceedings to recover any such loss, damages or costs shall not be commenced after the expiration of 2 years from the date of the allotment.

Applications for, and allotment of, shares and debentures.

56.—(1) No allotment shall be made of any shares in or debentures of a company in pursuance of a prospectus issued generally and no proceedings shall be taken on applications made in pursuance of a prospectus so issued until the beginning of the fourth day after that on which the prospectus is first so issued or such later time (if any) as may be specified in the prospectus.

The beginning of the said fourth day or such later time as aforesaid is hereafter in this Act referred to as “the time of the opening of the subscription lists”.

(2) In subsection (1) the reference to the day on which the prospectus is first issued generally shall be construed as referring to the day on which it is first so issued as a newspaper advertisement so however that if it is not so issued as a newspaper advertisement before the fourth day after that on which it is so issued in any other manner, the said reference shall be construed as referring to the day on which it is first so issued in any manner.

(3) The validity of an allotment shall not be affected by any contravention of subsection (1) or subsection (2) but, in the event of any such contravention, the company and every officer of the company who is in default shall be liable to a fine not exceeding £100.

(4) In the application of this section to a prospectus offering shares or debentures for sale, subsections (1) to (3) shall have effect with the substitution of references to sale for references to allotment, and with the substitution for the reference to the company and every officer of the company who is in default of a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the contravention.

(5) An application for shares in or debentures of a company which is made in pursuance of a prospectus issued generally shall be irrevocable until after the expiration of 9 days after the day on which the prospectus is first so issued or the giving before the expiration of the said 9 days, by some person responsible under section 49 for the prospectus, of a public notice having the effect under that section of excluding or limiting the responsibility of the person giving it.

(6) In reckoning for the purposes of this section the fourth day after another day, any intervening day which is a Saturday or Sunday or which is a bank holiday shall be disregarded and if the fourth day (as so reckoned) is itself a Saturday or Sunday or such a bank holiday there shall for the said purposes be substituted the first day thereafter which is none of them.

Allotment of shares and debentures to be dealt in on stock exchange.

57.—(1) Where a prospectus, whether issued generally or not, states that application has been or will be made for permission for the shares or debentures offered thereby to be dealt in on any stock exchange, any allotment made on an application in pursuance of the prospectus shall, whenever made, be void if the permission has not been applied for before the third day after the first issue of the prospectus or if the permission has not been granted within 6 weeks from the date of the closing of the subscription lists.

(2) Where the permission has not been applied for as aforesaid or has not been granted, the company shall forthwith repay without interest all money received from applicants in pursuance of the prospectus, and, if any such money is not repaid within 8 days after the company becomes liable to repay it, the directors of the company shall be jointly and severally liable to repay that money with interest at the rate of 5 per cent. per annum from the expiration of the eighth day, so however that a director shall not be liable if he proves that the default in the repayment of the money was not due to any misconduct or negligence on his part.

(3) All money received as aforesaid shall be kept in a separate bank account so long as the company may become liable to repay it under subsection (2); and, if default is made in complying with this subsection, the company and every officer of the company who is in default shall be liable to a fine not exceeding £100.

(4) Any condition requiring or binding any applicant for shares or debentures to waive compliance with any requirement of this section shall be void.

(5) This section shall have effect—

(a) in relation to any shares or debentures agreed to be taken by a person underwriting an offer thereof by a prospectus as if he had applied therefor in pursuance of the prospectus, and

(b) in relation to a prospectus offering shares or debentures for sale with the following modifications,—

(i) references to sale shall be substituted for references to allotment,

(ii) the persons by whom the offer is made, and not the company, shall be liable under subsection (2) to repay money received from applicants, and references to the company's liability under that subsection shall be construed accordingly, and

(iii) for the reference in subsection (3) to the company and every officer of the company who is in default there shall be substituted a reference to any person by or through whom the offer is made and who knowingly and wilfully authorises or permits the default.

(6) In reckoning for the purposes of this section the third day after another day, any intervening day which is a Saturday or Sunday or which is a bank holiday shall be disregarded and if the third day (as so reckoned) is itself a Saturday or Sunday or such a bank holiday there shall for the said purposes be substituted the first day thereafter which is none of them.

Return as to allotments.

58.—(1) Whenever a company limited by shares or a company limited by guarantee and having a share capital makes any allotment of its shares, the company shall within one month thereafter deliver to the registrar of companies for registration—

(a) a return of the allotments, stating the number and nominal amount of the shares comprised in the allotment, the names, addresses and occupations of the allottees and the amount, if any, paid or due and payable on each share; and

(b) in the case of shares allotted as fully or partly paid up otherwise than in cash, a contract in writing constituting the title of the allottee to the allotment together with any contract of sale, or for services or other consideration in respect of which that allotment was made, such contracts being duly stamped, and a return stating the number and nominal amount of shares so allotted, the extent to which they are to be treated as paid up, and the consideration for which they have been allotted,

provided that, where shares are allotted to the members of a company on a capitalisation or provisionally allotted on a rights issue, it shall not be necessary to make a return of the particular allottees, notwithstanding that in either case there may be a right of renunciation.

(2) Where such a contract as above mentioned is not reduced to writing, the company shall within one month after the allotment deliver to the registrar of companies for registration the prescribed particulars of the contract stamped with the same stamp duty as would have been payable if the contract had been reduced to writing, and those particulars shall be deemed to be an instrument within the meaning of the Stamp Act, 1891, and the registrar may, as a condition of filing the particulars, require that the duty payable thereon be adjudicated under section 12 of that Act.

(3) If default is made in complying with this section, every officer of the company who is in default shall be liable to a fine not exceeding £100.

(4) In case of default in delivering to the registrar of companies within one month after the allotment any document required to be delivered by this section, the company, or any officer liable for the default, may apply to the court for relief, and the court, if satisfied that the omission to deliver the document was accidental or due to inadvertence or that it is just and equitable to grant relief, may make an order extending the time for the delivery of the document for such period as the court may think proper.

Commissions and Discounts and Financial Assistance for Purchase of Shares.

Power to pay certain commissions, and prohibition of payment of all other commissions and discounts.

59.—(1) It shall be lawful for a company to pay a commission to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any shares in the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares in the company if—

(a) the payment of the commission is authorised by the articles; and

(b) the commission paid or agreed to be paid does not exceed 10 per cent. of the price at which the shares are issued or the amount or rate authorised by the articles, whichever is the less; and

(c) the amount and rate per cent. of the commission paid or agreed to be paid is—

(i) in the case of shares offered to the public for subscription, disclosed in the prospectus, or

(ii) in the case of shares not offered to the public for subscription, disclosed in the statement in lieu of prospectus, or in a statement in the prescribed form signed in like manner as a statement in lieu of prospectus and delivered before the payment of the commission to the registrar of companies for registration, and, where a circular or notice not being a prospectus inviting subscription for the shares is issued, also disclosed in that circular or notice; and

(d) the number of shares for which persons have agreed for a commission to subscribe absolutely is disclosed in manner aforesaid.

(2) Save as aforesaid, no company shall apply any of its shares or capital money either directly or indirectly in payment of any commission, discount or allowance to any person in consideration of his subscribing or agreeing to subscribe, whether absolutely or conditionally, for any shares in the company, or procuring or agreeing to procure subscriptions, whether absolute or conditional, for any shares in the company, whether the shares or money be so applied by being added to the purchase money of any property acquired by the company or to the contract price of any work to be executed for the company, or the money be paid out of the nominal purchase money or contract price, or otherwise.

(3) Nothing in this section shall affect the power of any company to pay such brokerage as it has heretofore been lawful for a company to pay.

(4) A vendor to, promoter of, or other person who receives payment in money or shares from a company shall have and shall be deemed always to have had power to apply any part of the money or shares so received in payment of any commission, the payment of which, if made directly by the company, would have been legal under this section.

(5) If default is made in complying with the provisions of this section relating to the delivery to the registrar of the statement in the prescribed form, the company and every officer of the company who is in default shall be liable to a fine not exceeding £100.

Giving of financial assistance by a company for the purchase of its shares.

60.—(1) Subject to subsections (2), (12) and (13), it shall not be lawful for a company to give, whether directly or indirectly, and whether by means of a loan, guarantee, the provision of security or otherwise, any financial assistance for the purpose of or in connection with a purchase or subscription made or to be made by any person of or for any shares in the company, or, where the company is a subsidiary company, in its holding company.

(2) Subsection (1) shall not apply to the giving of financial assistance by a company if—

(a) such financial assistance is given under the authority of a special resolution of the company passed not more than 12 months previously; and

(b) the company has forwarded with each notice of the meeting at which the special resolution is to be considered a copy of a statutory declaration which complies with subsections (3) and (4) and also delivers, on the same day as such notices are issued, a copy of the declaration to the registrar of companies for registration.

(3) The statutory declaration shall be made at a meeting of the directors held not more than 24 days before the said meeting and shall be made by the directors or, in the case of a company having more than two directors, by a majority of the directors.

(4) The statutory declaration shall state—

(a) the form which such assistance is to take;

(b) the persons to whom such assistance is to be given;

(c) the purpose for which the company intends those persons to use such assistance;

(d) that the declarants have made a full inquiry into the affairs of the company and that, having done so, they have formed the opinion that the company, having carried out the transaction whereby such assistance is to be given, will be able to pay its debts in full as they become due.

(5) Any director of a company making the statutory declaration without having reasonable grounds for the opinion that the company having carried out the transaction whereby such assistance is to be given will be able to pay its debts in full as they become due, shall be liable to imprisonment for a period not exceeding 6 months or to a fine not exceeding £100 or to both; and if the company is wound up within the period of 12 months after the making of the statutory declaration and its debts are not paid or provided for in full within the period of 12 months after the commencement of the winding up, it shall be presumed until the contrary is shown that the director did not have reasonable grounds for his opinion.

(6) Notwithstanding anything in the articles of association of the company, every member of the company shall have the right to receive notice of and to attend the meeting at which the special resolution is to be proposed.

(7) Unless all of the members of the company entitled to vote at general meetings of the company vote in favour of the special resolution, the transaction whereby such assistance is to be given shall not be carried out before the expiry of 30 days after such special resolution has been passed or, if an application under subsection (8) is made, until such application has been disposed of by the court.

(8) If application is made to the court in accordance with this section for the cancellation of the special resolution, such special resolution shall not have effect except to the extent to which it is confirmed by the court.

(9) Subject to subsection (10), an application under subsection (8) may be made by the holders of not less in the aggregate than 10 per cent. in nominal value of the company's issued share capital or any class thereof.

(10) An application shall not be made under subsection (8) by any person who has consented to or voted in favour of the special resolution.

(11) An application under subsection (8) must be made within 28 days after the date on which the special resolution was passed and may be made on behalf of the persons entitled to make the application by such one or more of their number as they may appoint in writing for the purpose.

(12) Nothing in this section shall be taken to prohibit the payment of a dividend properly declared by a company or the discharge of a liability lawfully incurred by it.

(13) Nothing in this section shall be taken to prohibit—

(a) where the lending of money is part of the ordinary business of the company, the lending of money by the company in the ordinary course of its business;

(b) the provision by a company, in accordance with any scheme for the time being in force, of money for the purchase of, or subscription for, fully paid shares in the company or its holding company, being a purchase or subscription of or for shares to be held by or for the benefit of employees or former employees of the company or of any subsidiary of the company including any person who is or was a director holding a salaried employment or office in the company or any subsidiary of the company;

(c) the making by a company of loans to persons, other than directors, bona fide in the employment of the company or any subsidiary of the company with a view to enabling those persons to purchase or subscribe for fully paid shares in the company or its holding company to be held by themselves as beneficial owners thereof.

(14) Any transaction in breach of this section shall be voidable at the instance of the company against any person (whether a party to the transaction or not) who had notice of the facts which constitute such breach.

(15) If a company acts in contravention of this section every officer of the company who is in default shall be liable:

(a) on conviction on indictment, to imprisonment for a term not exceeding 2 years or to a fine not exceeding £500 or to both, or

(b) on summary conviction, to imprisonment for a term not exceeding 6 months or to a fine not exceeding £100 or to both.

(16) Nothing in this section shall prejudice the provisions of section 72.

Construction of references to offering Shares or Debentures to the Public.

Construction of references to offering shares or debentures to the public.

61.—(1) Any reference in this Act to offering shares or debentures to the public shall, subject to any provision to the contrary contained therein, be construed as including a reference to offering them to any section of the public, whether selected as members or debenture holders of the company concerned or as clients of the person issuing the prospectus or in any other manner, and references in this Act or in a company's articles to invitations to the public to subscribe for shares or debentures shall, subject as aforesaid, be similarly construed.

(2) Subsection (1) shall not be taken as requiring any offer or invitation to be treated as made to the public if it can properly be regarded, in all the circumstances, as not being calculated to result, directly or indirectly, in the shares or debentures becoming available for subscription or purchase by persons other than those receiving the offer or invitation, or otherwise as being a domestic concern of the persons making and receiving it, and in particular—

(a) a provision in a company's articles prohibiting invitations to the public to subscribe for shares or debentures shall not be taken as prohibiting the making to members or debenture holders of an invitation which can properly be regarded as aforesaid, and

(b) the provisions of this Act relating to private companies shall be construed accordingly.

Issue of Shares at Premium and Discount and Redeemable Preference Shares.

Application of premiums received on issue of shares.

62.—(1) Where a company issues shares at a premium, whether for cash or otherwise, a sum equal to the aggregate amount or value of the premiums on those shares shall be transferred to an account, to be called “the share premium account”, and the provisions of this Act relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the share premium account were paid up share capital of the company.

(2) The share premium account may, notwithstanding anything in subsection (1) be applied by the company in paying up unissued shares of the company (other than redeemable preference shares) to be issued to members of the company as fully paid bonus shares, in writing off

(a) the preliminary expenses of the company, or

(b) the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company;

or in providing for the premium payable on redemption of any redeemable preference shares or of any debentures of the company.

(3) Where a company has before the operative date issued any shares at a premium, this section shall apply as if the shares had been issued after the operative date, so however that any part of the premiums which has been so applied that it does not at the operative date form an identifiable part of the company's reserves within the meaning of the Sixth Schedule shall be disregarded in determining the sum to be included in the share premium account.

Power to issue shares at a discount.

63.—(1) Subject to the provisions of this section, it shall be lawful for a company to issue at a discount shares in the company of a class already issued so, however, that—

(a) the issue of the shares at a discount must be authorised by a special resolution of the company, and must be sanctioned by the court;

(b) the resolution must specify the maximum rate of discount at which the shares are to be issued;

(c) in the case of a company which is not a private company not less than 2 years must at the date of issue have elapsed since the date on which the company was entitled to commence business and, in the case of a private company not less than 2 years must have elapsed since the date on which the company was incorporated;

(d) the shares to be issued at a discount must be issued within 6 months after the date on which the issue is sanctioned by the court or within such extended time as the court may allow.

(2) Where a company has passed a resolution authorising the issue of shares at a discount, it may apply to the court for an order sanctioning the issue, and on any such application the court, if, having regard to all the circumstances of the case, it thinks proper so to do, may make an order sanctioning the issue on such terms and conditions as it thinks fit.

(3) The company shall, within 21 days after the making of the order, deliver a copy of the order to the registrar of companies for registration.

(4) Every prospectus relating to the issue of the shares must contain particulars of the discount allowed on the issue of the shares or of so much of that discount as has not been written off at the date of the issue of the prospectus.

(5) If default is made in complying with subsection (3) or (4) the company and every officer of the company who is in default shall be liable to a fine not exceeding £100.

Power to issue redeemable preference shares.

64.—(1) Subject to the provisions of this section, a company limited by shares may, if so authorised by its articles, issue preference shares which are, or at the option of the company are to be liable, to be redeemed, so, however, that—

(a) no such shares shall be redeemed except out of profits of the company which would otherwise be available for dividend or out of the proceeds of a fresh issue of shares made for the purposes of the redemption;

(b) no such shares shall be redeemed unless they are fully paid;

(c) the premium, if any, payable on redemption, must have been provided for out of the profits of the company or out of the company's share premium account before the shares are redeemed;

(d) where any such shares are redeemed otherwise than out of the proceeds of a fresh issue, there shall out of profits which would otherwise have been available for dividend be transferred to a reserve fund to be called “the capital redemption reserve fund”, a sum equal to the nominal amount of the shares redeemed and the provisions of this Act relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the capital redemption reserve fund were paid up share capital of the company.

(2) Subject to the provisions of this section, the redemption of preference shares thereunder may be effected on such terms and in such manner as may be provided by the articles of the company.

(3) The redemption of preference shares under this section by a company shall not be taken as reducing the amount of the company's authorised share capital.

(4) Subject to subsection (5), where in pursuance of this section a company has redeemed or is about to redeem any preference shares, it shall have power to issue shares up to the nominal amount of the shares redeemed or to be redeemed as if those shares had never been issued, and accordingly the share capital of the company shall not for the purposes of any enactments relating to stamp duty be deemed to be increased by the issue of shares in pursuance of this subsection.

(5) Where new shares are issued before the redemption of the old shares, the new shares shall not, so far as relates to stamp duty, be deemed to have been issued in pursuance of subsection (4) unless the old shares are redeemed within one month after the issue of the new shares.

(6) The capital redemption reserve fund may, notwithstanding anything in this section, be applied by the company in paying up unissued shares of the company (other than redeemable preference shares) to be issued to members of the company as fully paid bonus shares.

Power to redeem preference shares issued before 5th May, 1959.

65.—(1) Subject to the provisions of this section, a company limited by shares may, if so authorised by its articles, redeem any preference shares issued by it before the 5th day of May, 1959, so, however, that—

(a) no such shares shall be redeemed unless they are fully paid;

(b) no such shares shall be redeemed except out of profits of the company which would otherwise be available for dividend or out of the proceeds of a fresh issue of shares made for the purposes of the redemption;

(c) no such shares shall be redeemed at a sum greater than the issue price of such shares;

(d) the redemption of such shares and the terms and the manner thereof must have been authorised by a special resolution of the company;

(e) notice of the meeting at which the special resolution referred to in paragraph (d) is to be proposed and a copy of the said resolution must be published in Iris Oifigiúil and in at least one daily newspaper circulating in the district in which the registered office of the company is situated not less than 14 days and not more than 30 days before the date of the meeting;

(f) no holder of such shares shall be obliged to accept redemption thereof;

(g) in the case of a private company the redemption must have been sanctioned by the court.

(2) The powers conferred by this section may be availed of only by means of an offer made to all the holders of the preference shares concerned.

(3) Where any such shares are redeemed otherwise than out of the proceeds of a fresh issue, there shall out of profits which would otherwise have been available for dividend be transferred to a reserve fund to be called “the capital redemption reserve fund” a sum equal to the nominal amount of the shares redeemed, and the provisions of this Act relating to the reduction of the share capital of a company shall, except as provided in this section, apply as if the capital redemption reserve fund were paid up share capital of the company.

(4) Subject to the provisions of this section, the redemption of preference shares under this section may be effected on such terms and in such manner as may be provided by the special resolution referred to in paragraph (d) of subsection (1).

(5) The redemption of preference shares under this section by a company shall not be taken as reducing the amount of the company's authorised share capital.

(6) Subject to subsection (7), where in pursuance of this section a company has redeemed or is about to redeem any preference shares, it shall have power to issue shares up to the nominal amount of the shares redeemed or to be redeemed as if those shares had never been issued, and accordingly the share capital of the company shall not for the purposes of any enactments relating to stamp duty be deemed to be increased by the issue of shares in pursuance of this subsection.

(7) Where new shares are issued before the redemption of the old shares, the new shares shall not, so far as relates to stamp duty, be deemed to have been issued in pursuance of subsection (6) unless the old shares are redeemed within one month after the issue of the new shares.

(8) The capital redemption reserve fund may, notwithstanding anything in this section, be applied by the company in paying up unissued shares of the company (other than redeemable preference shares) to be issued to members of the company as fully paid bonus shares.

Miscellaneous Provisions as to Share Capital.

Power of company to arrange for different amounts being paid on shares.

66.—A company, if so authorised by its articles, may do any one or more of the following things—

(a) make arrangements on the issue of shares for a difference between the shareholders in the amounts and times of payment of calls on their shares;

(b) accept from any member the whole or a part of the amount remaining unpaid on any shares held by him, although no part of that amount has been called up;

(c) pay a dividend in proportion to the amount paid up on each share where a larger amount is paid up on some shares than on others.

Reserve liability of limited company.

67.—A limited company may by special resolution determine that any portion of its share capital which has not been already called up shall not be capable of being called up except in the event and for the purposes of the company being wound up, and thereupon that portion of its share capital shall not be capable of being called up except in the event and for the purposes aforesaid.

Power of company to alter its share capital.

68.—(1) A company limited by shares or a company limited by guarantee and having a share capital, if so authorised by its articles, may in general meeting alter the conditions of its memorandum as follows, that is, it may—

(a) increase its share capital by new shares of such amount as it thinks expedient;

(b) consolidate and divide all or any of its share capital into shares of larger amount than its existing shares;

(c) convert all or any of its paid up shares into stock, and re-convert that stock into paid up shares of any denominations;

(d) subdivide its shares, or any of them, into shares of smaller amount than is fixed by the memorandum, so however, that in the subdivision the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced share is derived;

(e) cancel shares which, at the date of the passing of the resolution in that behalf, have not been taken or agreed to be taken by any person, and diminish the amount of its share capital by the amount of the shares so cancelled.

(2) A cancellation of shares in pursuance of this section shall not be deemed to be a reduction of share capital within the meaning of this Act.

Notice to registrar of certain alterations in share capital.

69.—(1) If a company having a share capital has—

(a) consolidated and divided its share capital into shares of larger amount than its existing shares; or

(b) converted any shares into stock; or

(c) reconverted stock into shares; or

(d) subdivided its shares or any of them; or

(e) redeemed any redeemable preference shares; or

(f) redeemed any preference shares; or

(g) cancelled any shares, otherwise than in connection with a reduction of share capital under section 72:

it shall, within one month after so doing, give notice thereof to the registrar of companies, specifying, as the case may be, the shares consolidated, divided, converted, subdivided, redeemed or cancelled, or the stock reconverted.

(2) If default is made in complying with this section, the company and every officer of the company who is in default shall be liable to a fine not exceeding £50.

Notice of increase of share capital.

70.—(1) Where a company, having a share capital, whether its shares have or have not been converted into stock, has increased its share capital above the registered capital, it shall, within 15 days after the passing of the resolution increasing its share capital, give to the registrar of companies notice of the increase, and the registrar shall record the increase.

(2) The notice to be given as aforesaid shall include such particulars as may be prescribed with respect to the classes of shares affected, and the conditions subject to which the new shares have been or are to be issued.

(3) If default is made in complying with this section, the company and every officer of the company who is in default shall be liable to a fine not exceeding £50.

Power of unlimited company to provide for reserve share capital on re-registration.

71.—An unlimited company having a share capital may, by its resolution for registration as a limited company in pursuance of this Act, do either or both of the following things:

(a) increase the nominal amount of its share capital by increasing the nominal amount of each of its shares, but subject to the condition that no part of the increased capital shall be capable of being called up, except in the event and for the purposes of the company being wound up;

(b) provide that a specified portion of its uncalled share capital shall not be capable of being called up except in the event and for the purposes of the company being wound up.

Reduction of Share Capital.

Power of company to reduce its share capital.

72.—(1) Except in so far as this Act expressly permits, it shall not be lawful for a company limited by shares or a company limited by guarantee and having a share capital to purchase any of its shares or to reduce its share capital in any way.

(2) Subject to confirmation by the court, a company limited by shares or a company limited by guarantee and having a share capital, may, if so authorised by its articles, by special resolution reduce its share capital in any way and, in particular, without prejudice to the generality of the foregoing power, may—

(a) extinguish or reduce the liability on any of its shares in respect of share capital not paid up; or

(b) either with or without extinguishing or reducing liability on any of its shares, cancel any paid up share capital which is lost or unrepresented by available assets; or

(c) either with or without extinguishing or reducing liability on any of its shares, pay off any paid up share capital which is in excess of the wants of the company;

and may, if and so far as is necessary, alter its memorandum by reducing the amount of its share capital and of its shares accordingly.

(3) A special resolution under this section is, in this Act, referred to as “a resolution for reducing share capital”.

Application to court for confirming order, objections by creditors and settlement of list of objecting creditors.

73.—(1) Where a company has passed a resolution for reducing share capital, it may apply to the court for an order confirming the reduction.

(2) Where the proposed reduction of share capital involves either diminution of liability in respect of unpaid share capital, or the payment to any shareholder of any paid up share capital, and in any other case if the court so directs, the following provisions shall have effect, subject nevertheless to subsection (3);

(a) every creditor of the company who at the date fixed by the court is entitled to any debt or claim which, if that date were the commencement of the winding up of the company, would be admissible in proof against the company, shall be entitled to object to the reduction;

(b) the court shall settle a list of creditors so entitled to object, and for that purpose shall ascertain, as far as possible without requiring an application from any creditor, the names of those creditors and the nature and amount of their debts or claims, and may publish notices fixing a day or days within which creditors not entered on the list are to claim to be so entered or are to be excluded from the right of objecting to the reduction;

(c) where a creditor entered on the list whose debt or claim is not discharged or has not determined does not consent to the reduction, the court may, if it thinks fit, dispense with the consent of that creditor, on the company securing payment of his debt or claim by appropriating, as the court may direct, the following amount:—

(i) if the company admits the full amount of the debt or claim, or, though not admitting it, is willing to provide for it, then the full amount of the debt or claim;

(ii) if the company does not admit and is not willing to provide for the full amount of the debt or claim, or, if the amount is contingent or not ascertained, then an amount fixed by the court after the like inquiry and adjudication as if the company were being wound up by the court.

(3) Where a proposed reduction of share capital involves either the diminution of any liability in respect of unpaid share capital or the payment to any shareholder of any paid up share capital, the court may, if, having regard to any special circumstances of the case, it thinks proper so to do, direct that subsection (2) shall not apply as regards any class or any classes of creditors.

Order confirming reduction and powers of court on making such order.

74.—(1) The court, if satisfied in relation to every creditor of the company who, under section 73, is entitled to object to the reduction, that either his consent to the reduction has been obtained or that his debt or claim has been discharged or has determined, or has been secured, may make an order confirming the reduction on such terms and conditions as it thinks fit.

(2) Where the court makes any such order, it may—

(a) if for any special reason it thinks proper so to do, make an order directing that the company shall, during such period, commencing on or at any time after the date of the order, as is specified in the order, add to its name as the last words thereof the words “and reduced” or where the word “teoranta” is part of such name, the words “agus laghdaithe”,

(b) make an order requiring the company to publish as the court directs the reasons for reduction or such other information in regard thereto as the court may think expedient, with a view to giving proper information to the public, and, if the court thinks fit, the causes which led to the reduction.

(3) Where a company is ordered to add to its name the words “and reduced”, or the words “agus laghdaithe” those words shall, until the expiration of the period specified in the order, be deemed to be part of the name of the company.

Registration of order and minute of reduction.

75.—(1) The registrar of companies, on production to him of an order of the court confirming the reduction of the share capital of a company, and the delivery to him of a copy of the order and of a minute approved by the court showing, with respect to the share capital of the company as altered by the order, the amount of the share capital, the number of shares into which it is to be divided, and the amount of each share, and the amount, if any, at the date of the registration deemed to be paid up on each share, shall register the order and minute.

(2) On the registration of the order and minute, and not before, the resolution for reducing share capital as confirmed by the order so registered shall take effect.

(3) Notice of the registration shall be published in such manner as the court may direct.

(4) The registrar shall certify under his hand the registration of the order and minute, and his certificate shall be conclusive evidence that all the requirements of this Act relating to reduction of share capital have been complied with, and that the share capital of the company is such as is stated in the minute.

(5) The minute when registered shall be deemed to be substituted for the corresponding part of the memorandum, and shall be valid and alterable as if it had been originally contained therein.

(6) The substitution of any such minute as aforesaid for part of the memorandum of the company shall be deemed to be an alteration of the memorandum within the meaning of section 30.

Liability of members in respect of reduced shares.

76.—(1) Subject to subsection (2), in the case of a reduction of share capital, a member of the company, past or present, shall not be liable in respect of any share to any call or contribution exceeding in amount the difference, if any, between the amount of the share as fixed by the minute and the amount paid, or the reduced amount, if any, which is to be deemed to have been paid, on the share, as the case may be.