Companies Act, 1990

• Permanent Page URL

Number 33 of 1990

COMPANIES ACT, 1990

ARRANGEMENT OF SECTIONS

PART I

Preliminary

PART II

Investigations

PART III

Transactions Involving Directors

Preliminary

Particular transactions involving conflict of interest

Disclosure of transactions involving directors and others

Supplemental

PART IV

Disclosure of Interests in Shares

Chapter 1

Share Dealings by Directors, Secretaries and their Families

Chapter 2

Individual and Group Acquisitions

Chapter 3

Disclosure Orders: Companies other than Public Limited Companies

Chapter 4

General provisions about share registers etc.

PART V

Insider Dealing

PART VI

Winding Up and Related Matters

Registration of Charges

Winding Up by the Court

Declaration of Solvency

Provisions applicable to a Members' Voluntary Winding Up

Provisions applicable to a Creditors' Voluntary Winding Up

Provisions applicable to every Voluntary Winding Up

Provisions applicable to every Winding Up

Supplementary Provisions

PART VII

Disqualifications and Restrictions: Directors and other Officers

Chapter 1

Restriction on Directors of Insolvent Companies

Chapter 2

Disqualification Generally

Chapter 3

Enforcement

PART VIII

Receivers

PART IX

Companies under Court Protection

PART X

Accounts and Audit

PART XI

Acquisition of Own Shares and Shares in Holding Company

PART XII

General

PART XIII

Investment Companies

SCHEDULE

Provisions Substituted for Ninth Schedule to Principal Act.

Number 33 of 1990

COMPANIES ACT, 1990

AN ACT TO AMEND THE LAW RELATING TO COMPANIES AND TO PROVIDE FOR RELATED MATTERS. [22nd December, 1990]

BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

PART I

Preliminary

Short title, collective citation and construction.

1.—(1) This Act may be cited as the Companies Act, 1990.

(2) This Act and the Companies Acts, 1963 to 1986, may be cited together as the Companies Acts, 1963 to 1990.

(3) The Companies Acts, 1963 to 1986, and this Act shall be construed together as one Act.

Commencement.

2.—This Act shall come into operation on such day or days as may be fixed therefor by order or orders of the Minister, either generally or with reference to a particular purpose or provision, and different days may be so fixed for different purposes and different provisions of this Act.

Interpretation.

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

“books and documents” and “books or documents” include accounts, deeds, writings and records made in any other manner;

“child” includes a step-child and an adopted child and “son”, “daughter” and “parent” shall be construed accordingly;

“the Companies Acts” means the Companies Act, 1963 , and every enactment (including this Act) which is to be construed as one with that Act;

“connected person” has the meaning assigned to it by section 26 ;

“contravention” includes failure to comply;

“daily default fine” has the meaning assigned to it by section 240 (6);

“the Minister” means the Minister for Industry and Commerce;

“prescribe” means prescribe by regulations;

“the Principal Act” means the Companies Act, 1963 ;

“recognised stock exchange” has the meaning assigned to it by subsection (2);

“related company” has the meaning assigned to it by section 140 ;

“shadow director” has the meaning assigned to it by section 27 .

(2) (a) A recognised stock exchange for the purposes of any provision of the Companies Acts is an exchange prescribed by the Minister for the purposes of that section.

(b) The definition of “recognised stock exchange” in paragraph (a) is in substitution for the definition in section 2 (1) of the Principal Act.

(3) The Minister may make regulations in relation to any matter referred to in this Act as prescribed or to be prescribed.

(4) In this Act—

(a) a reference to a Part or section is to a Part or section of this Act unless it is indicated that a reference to some other enactment is intended;

(b) a reference to a subsection, paragraph or subparagraph is to the subsection, paragraph or subparagraph of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended; and

(c) a reference to any other enactment shall, unless the context otherwise requires, be construed as a reference to that enactment as amended by or under any other enactment, including this Act.

Periods of time.

4.—(1) Where the time limited by any provision of this Act for the doing of anything expires on a Saturday, Sunday or public holiday, the time so limited shall extend to and the thing may be done on the first following day that is not a Saturday, Sunday or public holiday.

(2) Where in this Act anything is required or allowed to be done within a number of days not exceeding six a day that is a Saturday, Sunday or public holiday shall not be reckoned in computing that number.

Orders.

5.—The Minister may by order revoke or amend an order made by him under any provision of this Act, other than section 2 .

Repeals.

6.—(1) The following provisions of the Principal Act are hereby repealed — sections 147, 162 (inserted by section 6 of the Companies (Amendment) Act, 1982 ), 163, 165 to 173, 184, 294, 296, 380 and 385, and the Seventh and Tenth Schedules.

(2) The following provisions are also hereby repealed—

(a) Regulation 8 of the European Communities (Companies) Regulations, 1973,

(b) section 6 of the Companies (Amendment) Act, 1977 , and

(c) section 21 of the Companies (Amendment) Act, 1986 .

PART II

Investigations

Investigation of company's affairs.

7.—(1) The court may appoint one or more competent inspectors to investigate the affairs of a company in order to enquire into matters specified by the court and to report thereon in such manner as the court directs—

(a) in the case of a company having a share capital, on the application either of not less than 100 members or of a member or members holding not less than one-tenth of the paid up share capital of the company;

(b) in the case of a company not having a share capital, on the application of not less than one-fifth in number of the persons on the company's register of members;

(c) in any case, on the application of the company;

(d) in any case, on the application of a director of the company;

(e) in any case, on the application of a creditor of the company.

(2) The application shall be supported by such evidence as the court may require, including such evidence as may be prescribed.

(3) Where an application is made under this section, the court may require the applicant or applicants to give security, to an amount not less than £500 and not exceeding £100,000, for payment of the costs of the investigation.

(4) Where the court appoints an inspector under this section or section 8 , it may, from time to time, give such directions as it thinks fit, whether to the inspector or otherwise, with a view to ensuring that the investigation is carried out as quickly and as inexpensively as possible.

Investigation of company's affairs on application of Minister.

8.—(1) Without prejudice to its powers under section 7 , the court may on the application of the Minister appoint one or more competent inspectors to investigate the affairs of a company and to report thereon in such manner as the court shall direct, if the court is satisfied that there are circumstances suggesting—

(a) that its affairs are being or have been conducted with intent to defraud its creditors or the creditors of any other person or otherwise for a fraudulent or unlawful purpose or in an unlawful manner or in a manner which is unfairly prejudicial to some part of its members, or that any actual or proposed act or omission of the company (including an act or omission on its behalf) is or would be so prejudicial, or that it was formed for any fraudulent or unlawful purpose; or

(b) that persons connected with its formation or the management of its affairs have in connection therewith been guilty of fraud, misfeasance or other misconduct towards it or towards its members; or

(c) that its members have not been given all the information relating to its affairs which they might reasonably expect.

(2) (a) The power conferred by section 7 or this section shall be exercisable with respect to a body corporate notwithstanding that it is in course of being wound up.

(b) The reference in subsection (1) (a) to the members of a company shall have effect as if it included a reference to any person who is not a member but to whom shares in the company have been transferred or transmitted by operation of law.

Power of inspectors to extend investigation into affairs of related companies.

9.—If an inspector appointed under section 7 or 8 to investigate the affairs of a company thinks it necessary for the purposes of his investigation to investigate also the affairs of any other body corporate which is related to such company, he shall, with the approval of the court, have power so to do, and shall report on the affairs of the other body corporate so far as he thinks the results of his investigation thereof are relevant to the investigation of the affairs of the first-mentioned company.

Production of documents and evidence on investigation.

10.—(1) It shall be the duty of all officers and agents of the company and of all officers and agents of any other body corporate whose affairs are investigated by virtue of section 9 to produce to the inspectors all books and documents of or relating to the company, or, as the case may be, the other body corporate which are in their custody or power, to attend before the inspectors when required so to do and otherwise to give to the inspectors all assistance in connection with the investigation which they are reasonably able to give.

(2) If the inspectors consider that a person other than an officer or agent of the company or other body corporate is or may be in possession of any information concerning its affairs, they may require that person to produce to them any books or documents in his custody or power relating to the company or other body corporate, to attend before them and otherwise to give them all assistance in connection with the investigation which he is reasonably able to give; and it shall be the duty of that person to comply with the requirement.

(3) If an inspector has reasonable grounds for believing that a director of the company or other body corporate whose affairs the inspector is investigating maintains or has maintained a bank account of any description, whether alone or jointly with another person and whether in the State or elsewhere, into or out of which there has been paid—

(a) any money which has resulted from or been used in the financing of any transaction, arrangement or agreement—

(i) particulars of which have not been disclosed in a note to the accounts of any company for any financial year as required by section 41 ; or

(ii) in respect of which any amount outstanding was not included in the aggregate amounts outstanding in respect of certain transactions, arrangements or agreements as required by section 43 to be disclosed in a note to the accounts of any company for any financial year; or

(iii) particulars of which were not included in any register of certain transactions, arrangements and agreements as required by section 44 ; or

(b) any money which has been in any way connected with any act or omission, or series of acts or omissions, which on the part of that director constituted misconduct (whether fraudulent or not) towards that company or body corporate or its members;

the inspector may require the director to produce to him all documents in the director's possession, or under his control, relating to that bank account; and in this subsection “bank account” includes an account with any person exempt by virtue of section 7 (4) of the Central Bank Act, 1971 , from the requirement of holding a licence under section 9 of that Act, and “director” includes any present or past director or any person connected, within the meaning of section 26 , with such director, and any present or past shadow director.

(4) An inspector may examine on oath, either by word of mouth or on written interrogatories, the officers and agents of the company or other body corporate and such person as is mentioned in subsection (2) in relation to its affairs and may—

(a) administer an oath accordingly,

(b) reduce the answers of such person to writing and require him to sign them.

(5) If any officer or agent of the company or other body corporate or any such person as is mentioned in subsection (2) refuses to produce to the inspectors any book or document which it is his duty under this section so to produce, refuses to attend before the inspectors when required so to do or refuses to answer any question which is put to him by the inspectors with respect to the affairs of the company or other body corporate as the case may be, the inspectors may certify the refusal under their hand to the court, and the court may thereupon enquire into the case and, after hearing any witnesses who may be produced against or on behalf of the alleged offender and any statement which may be offered in defence, punish the offender in like manner as if he had been guilty of contempt of court.

(6) Without prejudice to its power under subsection (5), the court may, after a hearing under that subsection, make any order or direction it thinks fit, including a direction to the person concerned to attend or re-attend before the inspector or produce particular books or documents or answer particular questions put to him by the inspector, or a direction that the person concerned need not produce a particular book or document or answer a particular question put to him by the inspector.

(7) In this section, any reference to officers or to agents shall include past, as well as present, officers or agents, as the case may be, and “agents”, in relation to a company or other body corporate, shall include the bankers and solicitors of the company or other body corporate and any persons employed by the company or other body corporate as auditors, whether those persons are or are not officers of the company or other body corporate.

Inspectors' reports.

11.—(1) Inspectors appointed under section 7 or 8 may, and if so directed by the court shall, make interim reports to the court and on the conclusion of the investigation, shall make a final report to the court.

(2) Notwithstanding anything contained in subsection (1), an inspector appointed under section 7 or 8 may at any time in the course of his investigation, without the necessity of making an interim report, inform the court of matters coming to his knowledge as a result of the investigation tending to show that an offence has been committed.

(3) Where inspectors were appointed under section 7 or 8 , the court shall furnish a copy of every report of theirs to the Minister and the court may, if it thinks fit—

(a) forward a copy of any report made by the inspectors to the company's registered office,

(b) furnish a copy on request and payment of the prescribed fee to—

(i) any member of the company or other body corporate which is the subject of the report;

(ii) any person whose conduct is referred to in the report;

(iii) the auditors of that company or body corporate;

(iv) the applicants for the investigation;

(v) any other person (including an employee) whose financial interests appear to the court to be affected by the matters dealt with in the report whether as a creditor of the company or body corporate or otherwise;

(vi) the Central Bank, in any case in which the report of the inspectors relates, wholly or partly, to the affairs of the holder of a licence under section 9 of the Central Bank Act, 1971 ; and

(c) cause any such report to be printed and published.

(4) Where the court so thinks proper it may direct that a particular part of a report made by virtue of this section be omitted from a copy forwarded or furnished under subsection (3) (a) or (b), or from the report as printed and published under subsection (3) (c).

Proceedings on inspectors' report.

12.—(1) Having considered a report made under section 11 , the court may make such order as it deems fit in relation to matters arising from that report including—

(a) an order of its own motion for the winding up of a body corporate, or

(b) an order for the purpose of remedying any disability suffered by any person whose interests were adversely affected by the conduct of the affairs of the company, provided that, in making any such order, the court shall have regard to the interests of any other person who may be adversely affected by the order.

(2) If, in the case of any body corporate liable to be wound up under the Companies Acts, it appears to the Minister from—

(a) any report made under section 11 as a result of an application by the Minister under section 8 , or

(b) any report made by inspectors appointed by the Minister under this Act, or

(c) any information or document obtained by the Minister under this Part,

that a petition should be presented for the winding up of the body, the Minister may, unless the body is already being wound up by the court, present a petition for it to be so wound up if the court thinks it just and equitable for it to be so wound up.

Expenses of investigation of company's affairs.

13.—(1) The expenses of and incidental to an investigation by an inspector appointed by the court under the foregoing provisions of this Act shall be defrayed in the first instance by the Minister for Justice but the court may direct that any person being—

(a) a body corporate dealt with in the report, or

(b) the applicant or applicants for the investigation,

shall be liable, to such extent as the court may direct, to repay the Minister for Justice, provided that no such liability on the part of the applicant or applicants shall exceed in the aggregate £100,000.

(2) Without prejudice to subsection (1), any person who is—

(a) convicted on indictment of an offence on a prosecution instituted as a result of an investigation,

(b) ordered to pay damages or restore any property in proceedings brought as a result of an investigation, or

(c) awarded damages or to whom property is restored in proceedings brought as a result of an investigation,

may, in the same proceedings, be ordered to repay all or part of the expenses referred to in subsection (1) to the Minister for Justice or to any person on whom liability has been imposed by the court under that subsection, provided that, in the case of a person to whom paragraph (c) relates, the court shall not order payment in excess of one-tenth of the amount of the damages awarded or of the value of the property restored, as the case may be, and any such order shall not be executed until the person concerned has received his damages or the property has been restored, as the case may be.

(3) The report of an inspector may, if he thinks fit, and shall, if the court so directs, include a recommendation as to the directions (if any) which he thinks appropriate, in the light of his investigation, to be given under subsection (1).

Appointment and powers of inspectors to investigate ownership of company.

14.—(1) The Minister may, subject to subsection (2), appoint one or more competent inspectors to investigate and report on the membership of any company and otherwise with respect to the company for the purpose of determining the true persons who are or have been financially interested in the success or failure (real or apparent) of the company or able to control or materially to influence the policy of the company.

(2) An appointment may be made by the Minister if he is of the opinion that there are circumstances suggesting that it is necessary—

(a) for the effective administration of the law relating to companies;

(b) for the effective discharge by the Minister of his functions under any enactment; or

(c) in the public interest.

(3) The appointment of an inspector under this section may define the scope of his investigation, whether as respects the matters or the period to which it is to extend or otherwise, and in particular may limit the investigation to matters connected with particular shares or debentures.

(4) Subject to the terms of an inspector's appointment his powers shall extend to the investigation of any circumstances suggesting the existence of an arrangement or understanding which, though not legally binding, is or was observed or likely to be observed in practice and which is relevant to the purposes of his investigation.

(5) For the purposes of any investigation under this section, sections 9 to 11 , except section 10 (3), shall apply with the necessary modifications of references to the affairs of the company or to those of any other body corporate, so, however, that—

(a) the said sections shall apply in relation to all persons who are or have been, or whom the inspector has reasonable cause to believe to be or have been, financially interested in the success or failure or the apparent success or failure of the company or any other body corporate whose membership is investigated with that of the company, or able to control or materially to influence the policy thereof, including persons concerned only on behalf of others and to any other person whom the inspector has reasonable cause to believe possesses information relevant to the investigation, as they apply in relation to officers and agents of the company or of the other body corporate, as the case may be;

(b) if the Minister is of opinion that there is good reason for not divulging any part of a report made by virtue of this section he may disclose the report with the omission of that part; and may cause to be kept by the registrar of companies a copy of the report with that part omitted or, in the case of any other such report, a copy of the whole report; and

(c) for references to the court (except in section 10 (5) and (6)), there shall be substituted references to the Minister.

Power to require information as to persons interested in shares or debentures.

15.—(1) Where it appears to the Minister that it is necessary—

(a) for the effective administration of the law relating to companies;

(b) for the effective discharge by the Minister of his functions under any enactment; or

(c) in the public interest;

to investigate the ownership of any shares in or debentures of a company and that it is unnecessary to appoint an inspector for the purpose, he may require any person whom he has reasonable cause to believe to have or to be able to obtain any information as to the present and past interests in those shares or debentures and the names and addresses of the persons interested and of any persons who act or have acted on their behalf in relation to the shares or debentures to give any such information to the Minister.

(2) For the purposes of this section a person shall be deemed to have an interest in a share or debenture if he has any right to acquire or dispose of the share or debenture or any interest therein or to vote in respect thereof or if his consent is necessary for the exercise of any of the rights of other persons interested therein or if the other persons interested therein can be required or are accustomed to exercise their rights in accordance with his instructions.

(3) Any person who fails to give any information required of him under this section or who in giving any such information makes any statement which he knows to be false in a material particular, or recklessly makes any statement which is false in a material particular, shall be guilty of an offence.

Power to impose restrictions on shares or debentures.

16.—(1) Where in connection with an investigation or enquiry under section 14 or 15 it appears to the Minister that there is difficulty in finding out the relevant facts about any shares (whether issued or to be issued), the Minister may by notice in writing direct that the shares shall until further notice be subject to the restrictions imposed by this section.

(2) So long as a direction under subsection (1) in respect of any shares is in force—

(a) any transfer of those shares, or in the case of unissued shares any transfer of the right to be issued therewith and any issue thereof, shall be void;

(b) no voting rights shall be exercisable in respect of those shares;

(c) no further shares shall be issued in right of those shares or in pursuance of any offer made to the holder thereof; and

(d) except in a liquidation, no payment shall be made of any sums due from the company on those shares, whether in respect of capital or otherwise.

(3) Where shares are subject to the restrictions imposed by subsection (2) (a) any agreement to transfer the shares or in the case of unissued shares the right to be issued with the shares shall be void except an agreement to sell the shares pursuant to subsection (6) (b).

(4) Where shares are subject to the restrictions imposed by subsection (2) (c) or (2) (d) any agreement to transfer any right to be issued with other shares in right of those shares or to receive any payment on those shares (otherwise than in a liquidation) shall be void except an agreement to transfer any such right on the sale of the shares pursuant to subsection (6) (b).

(5) Where the Minister directs that shares shall be subject to the said restrictions, or refuses to direct that shares shall cease to be subject thereto, any person aggrieved thereby may apply to the court for an order that the shares shall cease to be subject thereto.

(6) Subject to subsections (7) and (13), an order of the court or a direction of the Minister that shares shall cease to be subject to the restrictions imposed by this section may be made only if—

(a) the court or, as the case may be, the Minister is satisfied that the relevant facts about the shares have been disclosed to the company and no unfair advantage had accrued to any person as a result of the earlier failure to make that disclosure; or

(b) the shares are to be sold and the court or the Minister approves the sale.

(7) Where any shares in a company are subject to the restrictions imposed by this section, the court may on the application of the Minister or the company order the shares to be sold, subject to the approval of the court as to the sale, and may also direct that the shares shall cease to be subject to those restrictions.

(8) Where an order has been made under subsection (7) then, on application of the Minister, the company, the person appointed by or in pursuance of the order to effect the sale or any person interested in the shares, the court may make such further order relating to the sale or to the transfer of the shares as it thinks fit.

(9) Where any shares are sold in pursuance of an order made under subsection (7), the proceeds of sale, less the costs of the sale, shall be paid into court for the benefit of the persons who are beneficially interested in the shares; and any such person may apply to the court for the whole or part of those proceeds to be paid to him.

(10) On an application under subsection (9) the court shall, subject to subsection (11), order the payment to the applicant of the whole of the proceeds of sale together with any interest thereon or, if any other person had a beneficial interest in the shares at the time of their sale, such proportion of those proceeds and interest as is equal to the proportion which the value of the applicant's interest in the shares bears to the total value of the shares.

(11) On granting an application for an order under subsection (7) or (8), the court may order that the costs of the applicant shall be paid out of the proceeds of sale; and, where an order under this subsection is made, the applicant shall be entitled to payment of his costs out of the proceeds of sale before any person interested in the shares in question receives any part of those proceeds.

(12) Any order or direction that shares shall cease to be subject to the said restrictions which is expressed to be made or given with a view to permitting a transfer of those shares or which is made under subsection (7) may continue the restrictions mentioned in subsection (2) (c) and (2) (d) in whole or in part, so far as they relate to any right acquired or offer made before the transfer.

(13) Subsection (6) shall not apply in relation to any order of the court or of the Minister directing that shares shall cease to be subject to any restrictions which have been continued in force in relation to those shares by virtue of subsection (12).

(14) Any person who—

(a) exercises or purports to exercise any right to dispose of any shares which, to his knowledge, are for the time being subject to the said restrictions or of any right to be issued with any such shares; or

(b) votes in respect of any such shares, whether as holder or proxy, or appoints a proxy to vote in respect thereof; or

(c) being the holder of any such shares, fails to notify of their being subject to the said restrictions any person whom he does not know to be aware of that fact but does know to be entitled, apart from the said restrictions, to vote in respect of those shares whether as holder or proxy; or

(d) being the holder of any such shares, or being entitled to any such right as is mentioned in subsection (4) enters into an agreement which is void by virtue of subsection (3) or (4);

shall be guilty of an offence.

(15) Where shares in any company are issued in contravention of the said restrictions, the company and every officer of the company who is in default shall be guilty of an offence.

(16) Summary proceedings shall not be instituted under this section except by or with the consent of the Minister.

(17) This section shall apply in relation to debentures as it applies in relation to shares.

(18) The Minister shall cause notice of any direction given by him under this section—

(a) to be sent to the company concerned at its registered office, and

(b) to be delivered to the registrar of companies,

(c) to be published in Iris Oifigiúil and in at least two daily newspapers,

as soon as may be after the direction is given.

Extension of powers of investigation to certain bodies incorporated outside the State.

17.— Sections 8 to 11 , 13 , 18 and 22 shall apply to all bodies corporate incorporated outside the State which are carrying on business in the State or have at any time carried on business therein as if they were companies registered under the Principal Act, subject to any necessary modifications.

Admissibility in evidence of certain matters.

18.—An answer given by a person to a question put to him in exercise of powers conferred by—

(a) section 10 ;

(b) section 10 as applied by sections 14 and 17 ; or

(c) rules made in respect of the winding-up of companies whether by the court or voluntarily under section 68 of the Courts of Justice Act, 1936 , as extended by section 312 of the Principal Act;

may be used in evidence against him, and a statement required by section 224 of the Principal Act may be used in evidence against any person making or concurring in making it.

Power of Minister to require production of documents.

19.—(1) The Minister may, subject to subsection (2), give directions to any body being—

(a) a company formed and registered under the Companies Acts;

(b) an existing company within the meaning of those Acts;

(c) a company to which the Principal Act applies by virtue of section 325 thereof or which is registered under that Act by virtue of Part IX thereof;

(d) a body corporate incorporated in, and having a principal place of business in, the State, being a body to which any of the provisions of the said Act with respect to prospectuses and allotments apply by virtue of section 377 of that Act;

(e) a body corporate incorporated outside the State which is carrying on business in the State or has at any time carried on business therein;

(f) any other body, whether incorporated or not, which is, or appears to the Minister to be, an insurance undertaking to which the Insurance Acts, 1909 to 1990, or regulations on insurance made under the European Communities Act, 1972 , would apply,

requiring the body, at such time and place as may be specified in the directions, to produce such books or documents as may be so specified, or may at any time, if he thinks there is good reason so to do, authorise any officer of his, on producing (if required so to do) evidence of his authority, to require any such body as aforesaid to produce to him forthwith any books or documents which the officer may specify.

(2) Directions may be given by the Minister if he is of the opinion that there are circumstances suggesting that—

(a) it is necessary to examine the books and documents of the body with a view to determining whether an inspector should be appointed to conduct an investigation of the body under the Companies Acts; or

(b) that the affairs of the body are being or have been conducted with intent to defraud—

(i) its creditors,

(ii) the creditors of any other person, or

(iii) its members; or

(c) that the affairs of the body are being or have been conducted for a fraudulent purpose other than described in paragraph (b); or

(d) that the affairs of the body are being or have been conducted in a manner which is unfairly prejudicial to some part of its members; or

(e) that any actual or proposed act or omission or series of acts or omissions of the body or on behalf of the body are or would be unfairly prejudicial to some part of its members; or

(f) that any actual or proposed act or omission or series of acts or omissions of the body or on behalf of the body are or are likely to be unlawful; or

(g) that the body was formed for any fraudulent purpose; or

(h) that the body was formed for any unlawful purpose.

(3) Where by virtue of subsection (1) the Minister or an officer authorised by the Minister has power to require the production of any books or documents from any body, the Minister or officer shall have the like power to require production of those books or documents from any person who appears to the Minister or officer to be in possession of them; but where any such person claims a lien on books or documents produced by him, the production shall be without prejudice to the lien.

(4) Any power conferred by or by virtue of this section to require a body or other person to produce books or documents shall include power—

(a) if the books or documents are produced—

(i) to take copies of them or extracts from them; and

(ii) to require that person, or any other person who is a present or past officer of, or is or was at any time employed by, the body in question, to provide an explanation of any of them;

(b) if the books or documents are not produced, to require the person who was required to produce them to state, to the best of his knowledge and belief, where they are.

(5) If a requirement to produce books or documents or provide an explanation or make a statement which is imposed by virtue of this section is not complied with, the body or other person on whom the requirement was so imposed shall be guilty of an offence; but where a person is charged with an offence under this subsection in respect of a requirement to produce any books or documents, it shall be a defence to prove that they were not in his possession or under his control and that it was not reasonably practicable for him to comply with the requirement.

(6) A statement made by a person in compliance with a requirement imposed by virtue of this section may be used in evidence against him.

(7) Nothing in this section shall prevent the Minister from authorising a person other than an officer of his to exercise the functions which an officer of his may exercise under this section and, where the Minister so authorises, such person shall have the same rights, duties and obligations as if he were such officer.

Entry and search of premises.

20.—(1) If a District Justice is satisfied on information on oath laid by an officer authorised by the Minister or laid under the authority of the Minister that there are reasonable grounds for suspecting that there are on any premises any books or documents of which production has been required under section 14 , 15 or 19 , and which have not been produced in compliance with that requirement, the Justice may issue a warrant authorising any member of the Garda Síochána together with any other persons named in the warrant and any other members of the Garda Síochána to enter the premises specified in the information (using such force as is reasonably necessary for the purpose) and to search the premises and take possession of any books or documents appearing to be such books or documents as aforesaid, or to take, in relation to any books or documents so appearing, any other steps which may appear necessary for preserving them and preventing interference with them.

(2) Every warrant issued under this section shall continue in force until the end of the period of one month after the date on which it is issued.

(3) Any books or documents of which possession is taken under this section may be retained for a period of three months or, if within that period there are commenced any such criminal proceedings as are mentioned in section 21 (1) (a) or (1) (b) (being proceedings to which the books or documents are relevant), until the conclusion of those proceedings.

(4) A person who obstructs the exercise of a right of entry or search conferred by virtue of a warrant issued under this section or who obstructs the exercise of a right so conferred to take possession of any books or documents, shall be guilty of an offence.

Provision for security of information.

21.—(1) No information, book or document relating to a body which has been obtained under section 19 or 20 shall, without the previous consent in writing of that body, be published or disclosed, except to a competent authority, unless the publication or disclosure is required—

(a) with a view to the institution of, or otherwise for the purposes of, any criminal proceedings pursuant to, or arising out of the Companies Acts or any criminal proceedings for an offence entailing misconduct in connection with the management of the body's affairs or misapplication or wrongful retainer of its property;

(b) with a view to the institution of, or otherwise for the purposes of, any criminal proceedings pursuant to or arising out of the Exchange Control Acts, 1954 to 1986, or the Insurance Acts, 1909 to 1990, or regulations on insurance made under the European Communities Act, 1972 ;

(c) for the purpose of complying with any requirement, or exercising any power, imposed or conferred by this Part with respect to reports made by inspectors appointed thereunder by the court or the Minister;

(d) with a view to the institution by the Minister of proceedings for the winding-up under the Principal Act of the body or otherwise for the purposes of proceedings instituted by him for that purpose;

(e) for the purposes of proceedings under section 20 .

(2) A person who publishes or discloses any information, book or document in contravention of this section shall be guilty of an offence.

(3) For the purposes of this section “competent authority” includes—

(a) the Minister,

(b) a person authorised by the Minister,

(c) an inspector appointed under this Act,

(d) the Minister for Finance,

(e) an officer authorised by the Minister for Finance,

(f) any court of competent jurisdiction,

(g) a supervisory authority within the meaning of regulations relating to insurance made under the European Communities Act, 1972 , and

(h) the Central Bank.

Inspectors' reports to be evidence.

22.—A document purporting to be a copy of a report of an inspector appointed under the provisions of this Part shall be admissible in any civil proceedings as evidence—

(a) of the facts set out therein without further proof unless the contrary is shown, and

(b) of the opinion of the inspector in relation to any matter contained in the report.

Saving for privileged information.

23.—(1) Nothing in this Part shall compel the disclosure by any person of any information which he would, in the opinion of the court, be entitled to refuse to produce on the grounds of legal professional privilege or authorise the taking of possession of any document containing such information which is in his possession.

(2) The Minister shall not, under section 19 , require, or authorise an officer of his to require, the production by a person carrying on the business of banking of a document relating to the affairs of a customer of his unless either it appears to the Minister that it is necessary so to do for the purpose of investigating the affairs of the first-mentioned person or the customer is a person on whom a requirement has been imposed by virtue of that section.

(3) The publication, in pursuance of any provision of this Part, of any report, information, book or document shall be privileged.

Power to make supplementary regulations.

24.—(1) If, in any respect, any difficulty arises in bringing any provision of this Part into operation or in relation to the operation of any such provision, the Minister may by regulations do anything which appears to him to be necessary or expedient for removing that difficulty, for bringing the provision into operation, or for securing or facilitating its operation, and any such regulations may modify any provision of this Part so far as may be necessary or expedient for carrying such provision into effect for the purposes aforesaid.

(2) Every regulation made by the Minister under this section shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the regulation is passed by either House within the next 21 days on which that House has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

PART III

Transactions Involving Directors

Preliminary

Interpretation of Part III .

25.—(1) In this Part, unless the context otherwise requires—

“credit transactions” has the meaning assigned to it by subsection (3);

“guarantee” includes indemnity;

“quasi-loan” has the meaning assigned to it by subsection (2);

“licensed bank” means the holder of a licence under section 9 of the Central Bank Act, 1971 .

(2) For the purposes of this Part—

(a) a quasi-loan is a transaction under which one party (“the creditor”) agrees to pay, or pays otherwise than in pursuance of an agreement, a sum for another (“the borrower”) or agrees to reimburse, or reimburses otherwise than in pursuance of an agreement, expenditure incurred by another party for another (“the borrower”)—

(i) on terms that the borrower (or a person on his behalf) will reimburse the creditor; or

(ii) in circumstances giving rise to a liability on the borrower to reimburse the creditor;

(b) any reference to the person to whom a quasi-loan is made is a reference to the borrower; and

(c) the liabilities of a borrower under a quasi-loan include the liabilities of any person who has agreed to reimburse the creditor on behalf of the borrower.

(3) For the purposes of this Part a credit transaction is a transaction under which one party (“the creditor”)—

(a) supplies any goods or sells any land under a hire-purchase agreement or conditional sale agreement;

(b) leases or licenses the use of land or hires goods in return for periodical payments;

(c) otherwise disposes of land or supplies goods or services on the understanding that payment (whether in a lump-sum or instalments or by way of periodical payments or otherwise) is to be deferred.

(4) For the purposes of this Part the value of a transaction or arrangement is—

(a) in the case of a loan, the principal of the loan;

(b) in the case of a quasi-loan, the amount, or maximum amount, which the person to whom the quasi-loan is made is liable to reimburse the creditor;

(c) in the case of a transaction or arrangement, other than a loan or quasi-loan or a transaction or arrangement within paragraph (d) or (e), the price which it is reasonable to expect could be obtained for the goods, land or services to which the transaction or arrangement relates if they had been supplied at the time the transaction or arrangement is entered into in the ordinary course of business and on the same terms (apart from price) as they have been supplied or are to be supplied under the transaction or arrangement in question;

(d) in the case of a guarantee or security, the amount guaranteed or secured;

(e) in the case of an arrangement to which section 31 (2) or 31 (3) applies the value of the transaction to which the arrangement relates less any amount by which the liabilities under the arrangement or transaction of the person for whom the transaction was made have been reduced.

(5) For the purposes of subsection (4), the value of a transaction or arrangement which is not capable of being expressed as a specific sum of money (because the amount of any liability arising under the transaction is unascertainable, or for any other reason) shall, whether or not any liability under the transaction has been reduced, be deemed to exceed £50,000.

(6) For the purposes of this Part, a transaction or arrangement is made for a person if—

(a) in the case of a loan or quasi-loan, it is made to him;

(b) in the case of a credit transaction, he is the person to whom goods or services are supplied, or land is sold or otherwise disposed of, under the transaction;

(c) in the case of a guarantee or security, it is entered into or provided in connection with a loan or quasi-loan made to him or a credit transaction made for him;

(d) in the case of an arrangement to which section 31 (2) or 31 (3) applies, the transaction to which the arrangement relates was made for him; and

(e) in the case of any other transaction or arrangement for the supply or transfer of goods, land or services (or any interest therein), he is the person to whom the goods, land or services (or the interest) are supplied or transferred.

(7) This Part, except sections 41 , 43 and 44 , does not apply to arrangements or transactions entered into before the commencement of this section but, for the purposes of determining whether an arrangement is one to which section 31 (2) or 31 (3) applies the transaction to which the arrangement relates shall, if it was entered into before the said commencement, be deemed to have been entered into thereafter.

(8) This Part shall have effect in relation to an arrangement or transaction whether governed by the law of the State or of another country.

Connected persons.

26.—(1) For the purposes of this Part, a person is connected with a director of a company if, but only if, he is—

(a) that director's spouse, parent, brother, sister or child;

(b) a person acting in his capacity as the trustee of any trust, the principal beneficiaries of which are the director, his spouse or any of his children or any body corporate which he controls; or

(c) a partner of that director;

unless that person is also a director of the company.

(2) A body corporate shall also be deemed to be connected with a director of a company if it is controlled by that director.

(3) For the purposes of this section, a director of a company shall be deemed to control a body corporate if, but only if, he is, alone or together with any of the persons referred to in paragraph (a), (b) or (c) of subsection (1), interested in more than one-half of the equity share capital of that body or entitled to exercise or control the exercise of more than one-half of the voting power at any general meeting of that body.

(4) In subsection (3)—

(a) “equity share capital” has the same meaning as in section 155 of the Principal Act; and

(b) references to voting power exercised by a director shall include references to voting power exercised by another body corporate which that director controls.

(5) The provisions of section 54 shall have effect for the purposes of subsection (3) with the substitution of the words “more than half” for the words “one-third or more” in subsections (5) and (6) of that section.

Shadow directors.

27.—(1) Subject to subsection (2), a person in accordance with whose directions or instructions the directors of a company are accustomed to act (in this Act referred to as “a shadow director”) shall be treated for the purposes of this Part as a director of the company unless the directors are accustomed so to act by reason only that they do so on advice given by him in a professional capacity.

(2) A shadow director shall not be guilty of an offence under section 44 (8) by virtue only of subsection (1).

(3) Section 194 of the Principal Act shall apply in relation to a shadow director of a company as it applies in relation to a director of a company, except that the shadow director shall declare his interest, not at a meeting of the directors, but by a notice in writing to the directors which is either—

(a) a specific notice given before the date of the meeting at which, if he had been a director, the declaration would be required by subsection (2) of that section to be made; or

(b) a notice which under subsection (3) of that section falls to be treated as a sufficient declaration of that interest or would fall to be so treated apart from the proviso;

and section 145 of that Act shall have effect as if the declaration had been made at the meeting in question and had accordingly formed part of the proceedings at that meeting.

Particular transactions involving conflict of interest

Contracts of employment of directors.

28.—(1) Subject to subsection (6), a company shall not incorporate in any agreement a term to which this section applies unless the term is first approved by a resolution of the company in general meeting and, in the case of a director of a holding company, by a resolution of that company in general meeting.

(2) This section applies to any term by which a director's employment with the company of which he is the director or, where he is the director of a holding company, his employment within the group is to continue, or may be continued, otherwise than at the instance of the company (whether under the original agreement or under a new agreement entered into in pursuance of the original agreement), for a period exceeding five years during which the employment—

(a) cannot be terminated by the company by notice; or

(b) can be so terminated only in specified circumstances.

(3) In any case where—

(a) a person is or is to be employed with a company under an agreement which cannot be terminated by the company by notice or can be so terminated only in specified circumstances; and

(b) more than six months before the expiration of the period for which he is or is to be so employed, the company enters into a further agreement (otherwise than in pursuance of a right conferred by or by virtue of the original agreement on the other party thereto) under which he is to be employed with the company or, where he is a director of a holding company, within the group,

subsection (2) shall apply as if to the period for which he is to be employed under that further agreement there were added a further period equal to the unexpired period of the original agreement.

(4) A resolution of a company approving a term to which this section applies shall not be passed at a general meeting of the company unless a written memorandum setting out the proposed agreement incorporating the term is available for inspection by members of the company both—

(a) at the registered office of the company for not less than the period of 15 days ending with the date of the meeting; and

(b) at the meeting itself.

(5) A term incorporated in an agreement in contravention of this section shall to the extent that it contravenes this section be void; and that agreement and, in a case where subsection (3) applies, the original agreement shall be deemed to contain a term entitling the company to terminate it at any time by the giving of reasonable notice.

(6) No approval is required to be given under this section by any body corporate unless it is a company within the meaning of the Principal Act or registered under Part IX of that Act or if it is, for the purposes of section 150 of that Act, a wholly owned subsidiary of any body corporate, wherever incorporated.

(7) In this section—

(a) “employment” includes employment under a contract for services; and

(b) “group”, in relation to a director of a holding company, means the group which consists of that company and its subsidiaries.

Substantial property transactions involving directors, etc.

29.—(1) Subject to subsections (6), (7) and (8), a company shall not enter into an arrangement—

(a) whereby a director of the company or its holding company or a person connected with such a director acquires or is to acquire one or more non-cash assets of the requisite value from the company; or

(b) whereby the company acquires or is to acquire one or more non-cash assets of the requisite value from such a director or a person so connected;

unless the arrangement is first approved by a resolution of the company in general meeting and, if the director or connected person is a director of its holding company or a person connected with such a director, by a resolution in general meeting of the holding company.

(2) For the purposes of this section a non-cash asset is of the requisite value if at the time the arrangement in question is entered into its value is not less than £1,000 but, subject to that, exceeds £50,000 or ten per cent of the amount of the company's relevant assets, and for those purposes the amount of a company's relevant assets is—

(a) except in a case falling within paragraph (b), the value of its net assets determined by reference to the accounts prepared and laid in accordance with the requirements of section 148 of the Principal Act in respect of the last preceding financial year in respect of which such accounts were so laid;

(b) where no accounts have been prepared and laid under that section before that time, the amount of its called-up share capital.

(3) An arrangement entered into by a company in contravention of this section and any transaction entered into in pursuance of the arrangement (whether by the company or any other person) shall be voidable at the instance of the company unless—

(a) restitution of any money or any other asset which is the subject-matter of the arrangement or transaction is no longer possible or the company has been indemnified in pursuance of subsection (4) (b) by any other person for the loss or damage suffered by it; or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person who is not a party to the arrangement or transaction would be affected by its avoidance; or

(c) the arrangement is, within a reasonable period, affirmed by the company in general meeting and, if it is an arrangement for the transfer of an asset to or by a director of its holding company or a person who is connected with such a director, is so affirmed with the approval of the holding company given by a resolution in general meeting.

(4) Without prejudice to any liability imposed otherwise than by this subsection, but subject to subsection (5), where an arrangement is entered into with a company by a director of the company or its holding company or a person connected with him in contravention of this section, that director and the person so connected, and any other director of the company who authorised the arrangement or any transaction entered into in pursuance of such an arrangement, shall (whether or not it has been avoided in pursuance of subsection (3)) be liable—

(a) to account to the company for any gain which he had made directly or indirectly by the arrangement or transaction; and

(b) (jointly and severally with any other person liable under this subsection) to indemnify the company for any loss or damage resulting from the arrangement or transaction.

(5) Where an arrangement is entered into by a company and a person connected with a director of the company or its holding company in contravention of this section, that director shall not be liable under subsection (4) if he shows that he took all reasonable steps to secure the company's compliance with this section and, in any case, a person so connected and any such other director as is mentioned in that subsection shall not be so liable if he shows that, at the time the arrangement was entered into, he did not know the relevant circumstances constituting the contravention.

(6) No approval is required to be given under this section by any body corporate unless it is a company within the meaning of the Principal Act or registered under Part IX of that Act or, if it is, for the purposes of section 150 of that Act, a wholly owned subsidiary of any body corporate, wherever incorporated.

(7) Subsection (1) shall not apply in relation to any arrangement for the acquisition of a non-cash asset—

(a) if the non-cash asset in question is or is to be acquired by a holding company from any of its wholly owned subsidiaries or from a holding company by any of its wholly owned subsidiaries or by one wholly owned subsidiary of a holding company from another wholly owned subsidiary of that same holding company; or

(b) if the arrangement is entered into by a company which is being wound up unless the winding up is a members' voluntary winding up.

(8) Subsection (1) (a) shall not apply in relation to any arrangement whereby a person acquires or is to acquire an asset from a company of which he is a member if the arrangement is made with that person in his character as such member.

(9) In this section—

(a) “non-cash asset” means any property or interest in property other than cash, and for this purpose “cash” includes foreign currency;

(b) any reference to the acquisition of a non-cash asset includes a reference to the creation or extinction of an estate or interest in, or a right over, any property and also a reference to the discharge of any person's liability other than a liability for a liquidated sum; and

(c) “net assets”, in relation to a company, means the aggregate of the company's assets less the aggregate of its liabilities, and for this purpose “liabilities” includes any provision for liabilities or charges within paragraph 70 of the Schedule to the Companies (Amendment) Act, 1986 .

Penalisation of dealing by director of a company in options to buy or sell certain shares in, or debentures of, the company or associated companies.

30.—(1) A director of a company who buys—

(a) a right to call for delivery at a specified price and within a specified time of a specified number of relevant shares or a specified amount of relevant debentures; or

(b) a right to make delivery at a specified price and within a specified time of a specified number of relevant shares or a specified amount of relevant debentures; or

(c) a right (as he may elect) to call for delivery at a specified price and within a specified time or to make delivery at a specified price and within a specified time of a specified number of relevant shares or a specified amount of relevant debentures;

shall be guilty of an offence.

(2) In subsection (1)—

(a) “relevant shares”, in relation to a director of a company, means shares in the company or in any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company, being shares for which dealing facilities are provided by a stock exchange (whether within the State or elsewhere); and

(b) “relevant debentures”, in relation to a director of a company, means debentures of the company or of any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company, being debentures as respects which there has been granted such dealing facilities as aforesaid.

(3) Nothing in this section shall be taken to penalise a person who buys a right to subscribe for shares in, or debentures of, a body corporate or buys debentures of a body corporate that confer upon the holder thereof a right to subscribe for, or to convert the debentures (in whole or in part) into, shares of the body.

(4) For the purposes of this section any reference, however expressed, to any price paid, given or received in respect of any interest in shares or debentures shall be construed as including a reference to any consideration other than money given or received in respect of any such interest, and any reference to a specified price includes a reference to a specified price range.

(5) This section shall also apply to any person (not being a director of the company) who—

(a) buys a right referred to in subsection (1), and

(b) does so on behalf or at the instigation of a director of the company.

Prohibition of loans, etc. to directors and connected persons.

31.—(1) Except as provided by sections 32 to 37 , a company shall not—

(a) make a loan or a quasi-loan to a director of the company or of its holding company or to a person connected with such a director;

(b) enter into a credit transaction as creditor for such a director or a person so connected;

(c) enter into a guarantee or provide any security in connection with a loan, quasi-loan or credit transaction made by any other person for such a director or a person so connected.

(2) A company shall not arrange for the assignment to it or the assumption by it of any rights, obligations or liabilities under a transaction which, if it had been entered into by the company, would have contravened subsection (1); but for the purposes of this Part the transaction shall be treated as having been entered into on the date of the arrangement.

(3) A company shall not take part in any arrangement whereby—

(a) another person enters into a transaction which, if it had been entered into by the company, would have contravened subsection (1) or (2); and

(b) that other person, in pursuance of the arrangement, has obtained or is to obtain any benefit from the company or its holding company or a subsidiary of the company or its holding company.

Arrangements of certain value.

32.—(1) Section 31 shall not prohibit a company from entering into an arrangement with a director or a person connected with a director if—

(a) the value of the arrangement, and

(b) the total amount outstanding under any other arrangements entered into by the company with any director of the company, or any person connected with a director,

together, is less than ten per cent of the company's relevant assets.

(2) For the purposes of this section—

(a) a company enters an arrangement with a person if it makes a loan or quasi-loan to, or enters into a credit transaction as creditor for, that person, and

(b) the amount of a company's relevant assets shall be determined in accordance with section 29 (2).

Reduction in amount of company's relevant assets.

33.—(1) This section applies to a company in respect of which the total amount outstanding under any arrangements referred to in section 32 comes to exceed 10 per cent of the company's relevant assets for any reason, but in particular because the value of those assets has fallen.

(2) Where the directors of a company become aware, or ought reasonably to become aware, that there exists a situation referred to in subsection (1), it shall be the duty of the company, its directors and any persons for whom the arrangements referred to in that subsection were made, to amend, within two months, the terms of the arrangements concerned so that the total amount outstanding under the arrangements again falls within the percentage limit referred to in that subsection.

Inter-company loans in same group.

34.—Where a company is a member of a group of companies, consisting of a holding company and its subsidiaries, section 31 shall not prohibit that company from—

(a) making a loan or quasi-loan to another member of that group; or

(b) entering into a guarantee or providing any security in connection with a loan or quasi-loan made by any person to another member of the group;

by reason only that a director of one member of the group is connected with another.

Transactions with holding company.

35.— Section 31 shall not prohibit a company from—

(a) making a loan or quasi-loan to its holding company or entering into a guarantee or providing any security in connection with a loan or quasi-loan made by any person to its holding company;

(b) entering into a credit transaction as creditor for its holding company or entering into a guarantee or providing any security in connection with any credit transaction made by any other person for its holding company.

Directors' expenses.

36.—(1) Section 31 shall not prohibit a company from doing anything to provide any of its directors with funds to meet vouched expenditure properly incurred or to be incurred by him for the purposes of the company or the purpose of enabling him properly to perform his duties as an officer of the company or doing anything to enable any of its directors to avoid incurring such expenditure.

(2) Where a company enters into any transaction pursuant to subsection (1), any liability falling on any person arising from any such transaction shall be discharged by him within six months from the date on which it was incurred.

(3) A person who contravenes subsection (2) shall be guilty of an offence.

Business transactions.

37.— Section 31 shall not prohibit a company from making any loan or quasi-loan or entering into any credit transaction as creditor for any person if—

(a) the company enters into the transaction concerned in the ordinary course of its business; and

(b) the value of the transaction is not greater, and the terms on which it is entered into are no more favourable, in respect of the person for whom the transaction is made, than that or those which—

(i) the company ordinarily offers, or

(ii) it is reasonable to expect the company to have offered,

to or in respect of a person of the same financial standing as that person but unconnected with the company.

Civil remedies for breach of section 31 .

38.—(1) Where a company enters into a transaction or arrangement in contravention of section 31 the transaction or arrangement shall be voidable at the instance of the company unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible, or the company has been indemnified in pursuance of subsection (2) (b) for the loss or damage suffered by it; or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person other than the person for whom the transaction or arrangement was made would be affected by its avoidance.

(2) Without prejudice to any liability imposed otherwise than by this subsection but subject to subsection (3), where an arrangement or transaction is made by a company for a director of the company or its holding company or person connected with such a director in contravention of section 31 , that director and the person so connected and any other director of the company who authorised the transaction or arrangement shall (whether or not it has been avoided in pursuance of subsection (1)) be liable—

(a) to account to the company for any gain which he has made directly or indirectly by the arrangement or transaction; and

(b) (jointly and severally with any other person liable under this subsection) to indemnify the company for any loss or damage resulting from the arrangement or transaction.

(3) Where an arrangement or transaction is entered into by a company and a person connected with a director of the company or its holding company in contravention of section 31 that director shall not be liable under subsection (2) if he shows that he took all reasonable steps to secure the company's compliance with that section and, in any case, a person so connected and any such other director as is mentioned in the said subsection (2) shall not be so liable if he shows that, at the time the arrangement or transaction was entered into, he did not know the relevant circumstances constituting the contravention.

Personal liability for company debts in certain cases.

39.—(1) If a company is being wound up and is unable to pay its debts, and the court considers that any arrangement of a kind described in section 32 has contributed materially to the company's inability to pay its debts or has substantially impeded the orderly winding up thereof, the court, on the application of the liquidator or any creditor or contributory of the company, may, if it thinks it proper to do so, declare that any person for whose benefit the arrangement was made shall be personally liable, without any limitation of liability, for all, or such part as may be specified by the court, of the debts and other liabilities of the company.

(2) In deciding whether to make a declaration under subsection (1), the court shall have particular regard to whether, and to what extent, any outstanding liabilities arising under any arrangement referred to in that subsection were discharged before the commencement of the winding up.

(3) In deciding the extent of any personal liability under this section, the court shall have particular regard to the extent to which the arrangement in question contributed materially to the company's inability to pay its debts or substantially impeded the orderly winding up of the company.

Criminal penalties for breach of section 31 .

40.—(1) An officer of a company who authorises or permits the company to enter into a transaction or arrangement knowing or having reasonable cause to believe that the company was thereby contravening section 31 shall be guilty of an offence.

(2) A person who procures a company to enter into a transaction or arrangement knowing or having reasonable cause to believe that the company was thereby contravening section 31 shall be guilty of an offence.

Disclosure of transactions involving directors and others

Substantial contracts, etc., with directors and others to be disclosed in accounts.

41.—(1) Subject to subsections (5) and (6) and to section 45 , group accounts prepared by a holding company in accordance with the requirements of section 150 of the Principal Act in respect of the relevant period shall contain the particulars specified in section 42 of—

(a) any transaction or arrangement of a kind described in section 31 entered into by the company or by a subsidiary of the company for a person who at any time during the relevant period was a director of the company or its holding company or was connected with such a director;

(b) any agreement by the company or by a subsidiary of the company to enter into any such transaction or arrangement for a person who at any time during the relevant period was a director of the company or its holding company or was connected with such a director;

(c) any other transaction or arrangement with the company or with a subsidiary of the company in which a person who at any time during the relevant period was a director of the company or its holding company had, directly or indirectly, a material interest.

(2) Subject as aforesaid, accounts prepared by any company other than a holding company in respect of the relevant period shall contain the particulars specified in section 42 of—

(a) any transaction or arrangement of a kind described in section 31 entered into by the company for a person who at any time during the relevant period was a director of the company or of its holding company or was connected with such a director;

(b) any agreement by the company to enter into any such transaction or arrangement for a person who at any time during the relevant period was a director of the company or of its holding company or was connected with such a director;

(c) any other transaction or arrangement with the company in which a person who at any time during the relevant period was a director of the company or of its holding company had, directly or indirectly, a material interest.

(3) Particulars which are required by subsection (1) or (2) to be contained in any accounts shall be given by way of notes to those accounts.

(4) Where by virtue of sections 150 (2) and 154 of the Principal Act a company does not produce group accounts in relation to any financial year, subsection (1) shall have effect in relation to the company and that financial year as if the word “group” were omitted.

(5) For the purposes of subsections (1) (c) and (2) (c)—

(a) a transaction or arrangement between a company and a director of the company or of its holding company or a person connected with such a director shall (if it would not otherwise be so treated) be treated as a transaction, arrangement or agreement in which that director is interested; and

(b) an interest in such a transaction or arrangement is not material if in the opinion of the majority of the directors (other than that director) of the company which is preparing the accounts in question it is not material (but without prejudice to the question whether or not such an interest is material in any case where those directors have not considered the matter).

(6) Subsections (1) and (2) do not apply, for the purposes of any accounts prepared by any company which is, or is the holding company of, a licensed bank, in relation to a transaction or arrangement of a kind described in section 31 , or an agreement to enter into such a transaction or arrangement, to which that licensed bank is a party.

(7) Subsections (1) and (2) do not apply in relation to the following transactions, arrangements and agreements—

(a) a transaction, arrangement or agreement between one company and another in which a director of the first company or of its subsidiary or holding company is interested only by virtue of his being a director of the other;

(b) a contract of service between a company and one of its directors or a director of its holding company or between a director of a company and any of that company's subsidiaries;

(c) a transaction, arrangement or agreement which was not entered into during the relevant period for the accounts in question and which did not subsist at any time during that period; and

(d) a transaction, arrangement or agreement which was made before the commencement of this section and which does not subsist thereafter.

(8) Subsections (1) and (2) apply whether or not—

(a) the transaction or arrangement was prohibited by section 31 ;

(b) the person for whom it was made was a director of the company or was connected with a director of the company at the time it was made;

(c) in the case of a transaction or arrangement made by a company which at any time during a relevant period is a subsidiary of another company, it was a subsidiary of that other company at the time the transaction or arrangement was made.

(9) In this section and in sections 43 and 45 , “relevant period”, in relation to a company, means a financial year of the company ending not earlier than 6 months after the commencement of the section concerned.

Particulars required to be included in accounts by section 41 .

42.—The particulars of a transaction, arrangement or agreement which are required by section 41 to be included in the annual accounts prepared by a company are particulars of the principal terms of the transaction, arrangement or agreement and (without prejudice to the generality of the foregoing provision)—

(a) a statement of the fact either that the transaction, arrangement or agreement was made or subsisted, as the case may be, during the financial year in respect of which those accounts are made up;

(b) the name of the person for whom it was made, and, where that person is or was connected with a director of the company or of its holding company, the name of that director;

(c) in any case where subsection (1) (c) or (2) (c) of section 41 applies, the name of the director with the material interest and the nature of that interest;

(d) in the case of a loan or an agreement for a loan or an arrangement within section 31 (2) or 31 (3) relating to a loan—

(i) the amount of the liability of the person to whom the loan was or was agreed to be made, in respect of principal and interest, at the beginning and at the end of that period;

(ii) the maximum amount of that liability during that period;

(iii) the amount of any interest which, having fallen due, has not been paid; and

(iv) the amount of any provision (within the meaning of the Sixth Schedule to the Principal Act or the Companies (Amendment) Act, 1986 ) made in respect of any failure or anticipated failure by the borrower to repay the whole or part of the loan or to pay the whole or part of any interest thereon;

(e) in the case of a guarantee or security or an arrangement within section 31 (2) relating to a guarantee or security—

(i) the amount for which the company (or its subsidiary) was liable under the guarantee or in respect of the security both at the beginning and at the end of the financial year in question;

(ii) the maximum amount for which the company (or its subsidiary) may become so liable; and

(iii) any amount paid and any liability incurred by the company (or its subsidiary) for the purpose of fulfilling the guarantee or discharging the security (including any loss incurred by reason of the enforcement of the guarantee or security); and

(f) in the case of any transaction, arrangement or agreement, other than those mentioned in paragraphs (d) and (e) the value of the transaction or arrangement or, as the case may be, the value of the transaction or arrangement to which the agreement relates; and

(g) in the case of arrangements to which section 32 relates, the aggregate value of such arrangements at the end of the financial year concerned, in relation to any persons specified in that section, expressed as a percentage of the company's relevant assets at that time; and

(h) any amendment of the terms of any such arrangement in accordance with section 33 .

Particulars of amounts outstanding to be included in accounts.

43.—(1) This section applies in relation to the following classes of transactions, arrangements and agreements—

(a) loans, guarantees and securities relating to loans, arrangements of a kind described in section 31 (2) or 31 (3) relating to loans, and agreements to enter into any of the foregoing transactions and arrangements;

(b) quasi-loans, guarantees and securities relating to quasi-loans, arrangements of a kind described in those subsections relating to quasi-loans and agreements to enter into any of the foregoing transactions and arrangements;

(c) credit transactions, guarantees and securities relating to credit transactions and arrangements of a kind described in those subsections relating to credit transactions and agreements to enter into any of the foregoing transactions and arrangements.

(2) The group accounts of a holding company prepared in accordance with the requirements of section 150 of the Principal Act and the accounts of any other company prepared in accordance with the requirements of section 148 of the Principal Act in respect of the relevant period shall contain a statement in relation to transactions, arrangements and agreements made by the company and, in the case of a holding company, by a subsidiary of the company for persons who at any time during the relevant period were officers of the company (but not directors) of the aggregate amounts outstanding at the end of the relevant period under transactions, arrangements and agreements within any paragraph of subsection (1) and the number of officers for whom the transactions, arrangements and agreements falling within each of those paragraphs were made.

(3) Subsection (2) shall not apply, in relation to the accounts prepared by any company in respect of any relevant period, to transactions, arrangements and agreements made by the company or any of its subsidiaries for any officer of the company if the aggregate amount outstanding at the end of that period under the transactions, arrangements and agreements so made for that officer does not exceed £2,500.

(4) Subsection (2) shall not apply in relation to any transaction, arrangement or agreement made by a licensed bank for any of its officers or for any of the officers of its holding company.

(5) The group accounts of a company which is, or is the holding company of, a licensed bank prepared in accordance with the requirements of section 150 of the Principal Act, and the accounts of any other company which is a licensed bank, prepared in accordance with the requirements of section 148 of the Principal Act in respect of the relevant period shall contain a statement in relation to transactions, arrangements or agreements made by the company preparing the accounts, if it is a licensed bank, and (in the case of a holding company) by any of its subsidiaries which is a licensed bank, for persons who at any time during the relevant period were directors of the company, of the aggregate amounts outstanding at the end of the relevant period under transactions, arrangements and agreements within any paragraph of subsection (1) and the number of persons for whom the transactions, arrangements and agreements falling within each of those paragraphs were made.

(6) (a) The statement referred to in subsection (5) shall also separately contain the like information as is referred to in that subsection in relation to transactions, arrangements or agreements made for persons who at any time during the relevant period were connected with a director of the company.

(b) A transaction, arrangement or agreement to which paragraph (a) applies need not be included in the statement if—

(i) it is entered into by the company concerned in the ordinary course of its business, and

(ii) its value is not greater, and its terms no more favourable, in respect of the person for whom it is made, than that or those which—

(I) the company ordinarily offers, or

(II) it is reasonable to expect the company to have offered,

to or in respect of a person of the same financial standing but unconnected with the company.

(7) Particulars which are required by subsection (2), (5) or (6) to be contained in any accounts shall be given by way of notes to those accounts.

(8) Where by virtue of sections 150 (2) and 154 of the Principal Act, a company does not produce group accounts in relation to any financial year, subsections (2), (5) and (6) shall have effect in relation to the company and that financial year as if the word “group” were omitted.

(9) Subsections (2), (5) and (6) do not apply in relation to a transaction, arrangement or agreement which was made before the commencement of this section and which does not subsist thereafter.

(10) For the purposes of this section, “amount outstanding” means the amount of the outstanding liabilities of the person for whom the transaction, arrangement or agreement in question was made, or, in the case of a guarantee or security, the amount guaranteed or secured.

Further provisions relating to licensed banks.

44.—(1) Subject to section 45 , a company which is, or is the holding company of, a licensed bank, shall maintain a register containing a copy of every transaction, arrangement or agreement of which particulars would, but for section 41 (6), be required by subsection (1) or (2) of that section to be disclosed in the company's accounts or group accounts for the current financial year and for each of the preceding ten financial years (but excluding any financial year ending prior to the passing of this Act) or, if such a transaction, arrangement or agreement is not in writing, a written memorandum setting out its terms.

(2) Subsection (1) shall not require a company to keep in its register a copy of any transaction, arrangement or agreement made for a connected person if—

(a) it is entered into in the ordinary course of the company's business, and

(b) its value is not greater, and its terms no more favourable, in respect of the person for whom it is made, than that or those which—

(i) the company ordinarily offers, or

(ii) it is reasonable to expect the company to have offered,

to or in respect of a person of the same financial standing but unconnected with the company.

(3) Subject to section 45 , a company which is, or is the holding company of, a licensed bank shall before its annual general meeting make available, at the registered office of the company for not less than the period of 15 days ending with the date of the meeting, for inspection by members of the company a statement containing the particulars of transactions, arrangements and agreements which the company would, but for section 41 (6), be required by subsection (1) or (2) of that section to disclose in its accounts or group accounts for the last complete financial year preceding that meeting and such a statement shall also be made available for inspection by the members at the annual general meeting.

(4) Subsection (3) shall not require the inclusion in the statement of particulars of any transaction, arrangement or agreement if—

(a) it is entered into in the ordinary course of the company's business, and

(b) its value is not greater, and its terms no more favourable, in respect of the person for whom it is made, than that or those which—

(i) the company ordinarily offers, or

(ii) it is reasonable to expect the company to have offered,

to or in respect of a person of the same financial standing but unconnected with the company.

(5) It shall be the duty of the auditors of the company to examine any such statement before it is made available to the members of the company in accordance with subsection (3) and to make a report to the members on that statement; and the report shall be annexed to the statement before it is made so available.

(6) A report under subsection (5) shall state whether in the opinion of the auditors the statement contains the particulars required by subsection (3) and, where their opinion is that it does not, they shall include in the report, so far as they are reasonably able to do so, a statement giving the required particulars.

(7) Subsection (3) shall not apply in relation to a licensed bank which is for the purposes of section 150 of the Principal Act the wholly owned subsidiary of a company incorporated in the State.

(8) Where a company fails to comply with subsection (1) or (3), the company and every person who at the time of that failure is a director of the company shall be guilty of an offence and liable to a fine.

(9) It shall be a defence in proceedings for an offence under subsection (8) for the defendant to prove that he took all reasonable steps for securing compliance with subsection (1) or (3), as the case may be.

Arrangements excluded from sections 41 and 44 .

45.—(1) Section 41 (1) and (2) and section 44 do not apply to arrangements of the kind mentioned in section 32 (2) entered into by a company or by a subsidiary of the company for a person who at any time during the relevant period was a director of the company or of its holding company or was connected with such a director, if the aggregate of the values of each arrangement so made for that director or any person connected with him, less the amount (if any) by which the liabilities of the person for whom the arrangement was made has been reduced, did not at any time during the relevant period exceed £2,500.

(2) Subsections (1) (c) and (2) (c) of section 41 do not apply, in relation to any accounts prepared by a company in respect of any relevant period, to any transaction or arrangement with a company or any of its subsidiaries in which a director of the company or of its holding company had, directly or indirectly, a material interest if—

(a) the value of each transaction or arrangement within subsection (1) (c) or (2) (c), as the case may be, in which that director had, directly or indirectly, a material interest and which was made after the commencement of that relevant period with the company or any of its subsidiaries; and

(b) the value of each such transaction or arrangement which was made before the commencement of that period less the amount (if any) by which the liabilities of the person for whom the transaction or arrangement was made have been reduced;

did not at any time during the relevant period exceed in the aggregate £1,000 or, if more, did not exceed £5,000 or one per cent of the value of the net assets of the company preparing the accounts in question as at the end of the relevant period for those accounts, whichever is the less and for this purpose, “net assets” has the same meaning as in section 29 (9).

Duty of auditors of company in breach of section 41 or 43 .

46.—If in the case of any group or other accounts of a company the requirements of section 41 or 43 are not complied with, it shall be the duty of the auditors of the company by whom the accounts are examined to include in their report on the balance sheet of the company, so far as they are reasonably able to do so, a statement giving the required particulars.

Disclosure by directors of interests in contracts, etc.

47.—(1) Any reference in section 194 of the Principal Act to a contract shall be construed as including a reference to any transaction or arrangement (whether or not constituting a contract) made or entered into on or after the commencement of this section.

(2) For the purposes of the said section 194, a transaction or arrangement of a kind described in section 31 made by a company for a director of the company or a person connected with such a director shall, if it would not otherwise be so treated (and whether or not prohibited by that section), be treated as a transaction or arrangement in which that director is interested.

(3) The following shall be substituted for subsection (3) of the said section 194—

“(3) Subject to subsection (4), for the purposes of this section, a general notice given to the directors of a company by a director to the effect that—

(a) he is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm; or

(b) he is to be regarded as interested in any contract which may after the date of the notice be made with a specified person who is connected with him (within the meaning of section 26 of the Companies Act, 1990),

shall be deemed to be a sufficient declaration of interest in relation to any such contract.”.

Supplemental

Power to alter financial limits under Part III .

48.—(1) The Minister may, by order, alter any of the financial limits specified in this Part.

(2) Every order made under this section shall be laid before each House of the Oireachtas as soon as may be after it is made and if a resolution annulling the order is passed by either House within the next 21 days on which that House has sat after the order is laid before it, the order shall be annulled accordingly but without prejudice to the validity of anything previously done thereunder.

Cessation of section 192 of Principal Act.

49.—Section 192 of the Principal Act shall cease to have effect except—

(a) in relation to accounts and directors' reports prepared in respect of any financial year ending before the commencement of this section; and

(b) in relation to accounts and directors' reports prepared in respect of the first financial year ending after the commencement of this section but only in relation to loans and contracts entered into before the commencement of this section which do not subsist on or after that day.

Inspection of directors' service contracts.

50.—(1) Subject to the provisions of this section every company shall keep at an appropriate place—

(a) in the case of each director whose contract of service with the company is in writing, a copy of that contract;

(b) in the case of each director whose contract of service with the company is not in writing, a written memorandum setting out the terms of that contract;

(c) in the case of each director who is employed under a contract of service with a subsidiary of the company, a copy of that contract or, if it is not in writing, a written memorandum setting out the terms of that contract;

(d) a copy or written memorandum, as the case may be, of any variation of any contract of service referred to in paragraph (a), (b) or (c);

and all copies and memoranda kept by a company in pursuance of this subsection shall be kept at the same place.

(2) Where a contract of service is only partially in writing, paragraphs (a), (b), (c) and (d), as appropriate, of subsection (1), and subsections (4) and (5), shall also apply to such a contract.

(3) The following shall, as regards a company, be appropriate places for the purposes of subsection (1), namely—

(a) its registered office;

(b) the place where its register of members is kept if other than its registered office;

(c) its principal place of business.

(4) Every company shall send notice in the prescribed form to the registrar of companies of the place where copies and memoranda required by subsection (1) to be kept by it are kept and of any change in that place, save in a case in which they have at all times been kept at its registered office.

(5) Subsection (1) shall not apply in relation to a director's contract of service with the company or with a subsidiary of the company if that contract required him to work wholly or mainly outside the State, but the company shall keep a memorandum—

(a) in the case of a contract of service with the company, setting out the name of the director and the provisions of the contract relating to its duration;

(b) in the case of a contract of service with a subsidiary of the company setting out the name of the director, the name and place of incorporation of the subsidiary and the provisions of the contract relating to its duration,

at the same place as copies and the memoranda are kept by the company in pursuance of subsection (1).

(6) Every copy and memorandum required to be kept by subsections (1) and (5) shall, during business hours (subject to such reasonable restrictions as the company may in general meeting impose, so that not less than two hours in each day be allowed for inspection), be open to the inspection of any member of the company without charge.

(7) If default is made in complying with subsection (1) or (5) or if an inspection required under subsection (6) is refused, the company and every officer of the company who is in default shall be liable on summary conviction to a fine not exceeding £1,000, and, for continued contravention, to a daily default fine not exceeding £50 and, if default is made for 14 days in complying with subsection (4), the company and every officer of the company who is in default shall be liable to a fine not exceeding £1,000 and, for continued contravention, to a daily default fine not exceeding £50.

(8) In the case of a refusal of an inspection required under subsection (6) of a copy or memorandum the court may by order compel an immediate inspection thereof.

(9) This section shall not require to be kept a copy of, or memorandum setting out the terms of, a contract or a copy of, or memorandum setting out the terms of a variation of, a contract at a time at which the unexpired portion of the term for which the contract is to be in force is less than three years or at a time at which the contract can, within the next ensuing three years, be terminated by the company without payment of compensation.

Register of directors and secretaries.

51.—The Principal Act is hereby amended by the substitution for section 195 of the following section—

“195.— (1) Every company shall keep at its registered office a register of its directors and secretaries.

(2) Subject to subsection (3), the said register shall contain the following particulars relating to each director—

(a) his present forename and surname and any former forename and surname; and

(b) his date of birth; and

(c) his usual residential address; and

(d) his nationality; and

(e) his business occupation, if any; and

(f) particulars of any other directorships of bodies corporate, whether incorporated in the State or elsewhere, held by him or which have been held by him.

(3) It shall not be necessary for the said register to contain on any day particulars of any directorship—

(a) which has not been held by a director at any time during the ten years preceding that day;

(b) which is held or was held by a director in bodies corporate of which the company is or was the wholly owned subsidiary or which are or were the wholly owned subsidiaries either of the company or of another body corporate of which the company is or was the wholly owned subsidiary;

and for the purposes of this subsection a body corporate shall be deemed to be the wholly owned subsidiary of another if it has no members except that other and that other's wholly owned subsidiaries and its or their nominees.

(4) Subject to subsection (5), the said register shall contain the following particulars relating to the secretary or, where there are joint secretaries, in relation to each of them—

(a) in the case of an individual, his present forename and surname, any former forename and surname and his usual residential address; and

(b) in the case of a body corporate, the corporate name and registered office.

(5) Where all the partners in a firm are joint secretaries of a company, the name and principal office of the firm may be stated instead of the said particulars.

(6) The company shall, within the period of 14 days from the happening of—

(a) any change among its directors or in its secretary, or

(b) any change in any of the particulars contained in the register,

send to the registrar of companies a notification in the prescribed form of the change and of the date on which it occurred.

(7) A notification sent to the registrar of companies pursuant to subsection (6) of the appointment of a person as a director, secretary or joint secretary of a company shall be accompanied by a consent signed by that person to act as director, secretary or joint secretary, as the case may be.

(8) Without prejudice to subsection (6), a person who has ceased to be a director or secretary of a company may send to the registrar of companies a notification in the prescribed form of such cessation, and of the date on which it occurred.

(9) Subsection (6) shall not apply to any change in the particulars contained in a company's register of directors and secretaries made solely by reason of the coming into force of section 51 of the Companies Act, 1990 but if after any such change has occurred and before the company makes its next annual return, any other change in those particulars occurs, the company shall send to the registrar of companies a notification in the prescribed form of any such earlier changes and the date on which they occurred at the same time as it notifies the registrar of the later changes in accordance with this section.

(10) The register to be kept under this section shall, during business hours (subject to such reasonable restrictions as the company may by its articles or in general meeting impose, so that not less than 2 hours in each day be allowed for inspection) be open to the inspection of any member of the company without charge, and of any other person, on payment of one pound or such less sum as the company may prescribe, for each inspection.

(11) It shall be the duty of each director and secretary of a company to give information in writing to the company as soon as may be of such matters as may be necessary to enable the company to comply with this section.

(12) If any inspection required under this section is refused or if default is made in complying with subsection (1), (2), (4), (6) or (7), the company and every officer of the company who is in default shall be liable to a fine not exceeding £1,000 and, for continued contravention, to a daily default fine not exceeding £50.

(13) In the case of any such refusal, the court may by order compel an immediate inspection of the register.

(14) A person who fails to comply with subsection (11) shall be guilty of an offence and liable to a fine.

(15) For the purposes of this section—

(a) in the case of a person usually known by a title different from his surname, the expression ‘surname’ means that title;

(b) references to a ‘former forename’ or ‘surname’ do not include—

(i) in the case of a person usually known by a title different from his surname, the name by which he was known previous to the adoption of or succession to the title; or

(ii) in the case of any person, a former forename or surname where that name or surname was changed or disused before the person bearing the name attained the age of 18 years or has been changed or disused for a period of not less than 20 years; or

(iii) in the case of a married woman, the name or surname by which she was known previous to the marriage.”.

Directors to have regard to interests of employees.

52.—(1) The matters to which the directors of a company are to have regard in the performance of their functions shall include the interests of the company's employees in general, as well as the interests of its members.

(2) Accordingly, the duty imposed by this section on the directors shall be owed by them to the company (and the company alone) and shall be enforceable in the same way as any other fiduciary duty owed to a company by its directors.

PART IV

Disclosure of Interests in Shares

Chapter 1

Share Dealings by Directors, Secretaries and their Families

Obligation of director or secretary to notify interests in shares or debentures of company.

53.—(1) Subject to the provisions of this section a person who, at the commencement of this section is a director or secretary of a company and is then interested in shares in, or debentures of, the company or any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company or thereafter becomes a director or secretary of a company and, at the time when he becomes a director or secretary of a company, is so interested, shall notify the company in writing—

(a) of the subsistence of his interests at that time, and

(b) of the number of shares of each class in, and the amount of debentures of each class of, the company or any such other body corporate as aforesaid in which each interest of his subsists at that time.

(2) A director or secretary of a company shall notify the company in writing of the occurrence, while he is a director or secretary, of any of the following events and the date on which it occurred—

(a) any event in consequence of whose occurrence he becomes, or ceases to be, interested in shares in, or debentures of, the company or any other body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company;

(b) the entering into by him of a contract to sell any such shares or debentures;

(c) the assignment by him of a right granted to him by the company to subscribe for shares in, or debentures of, the company; and

(d) the grant to him by another body corporate, being the company's subsidiary or holding company or a subsidiary of the company's holding company, of a right to subscribe for shares in, or debentures of, that other body corporate, the exercise of such a right granted to him and the assignment by him of such a right so granted;

stating the number or amount, and class, of shares or debentures involved.

(3) The provisions of section 54 shall have effect for the interpretation of, and otherwise in relation to, subsections (1) and (2).

(4) Section 56 shall have effect with respect to the periods within which obligations imposed by subsections (1) and (2) on persons must be fulfilled by them.

(5) Section 57 shall have effect with respect to certain circumstances in which obligations imposed by subsections (1) and (2) are to be treated as not discharged.

(6) In the case of a person who is a director or secretary of a company at the time when this section comes into operation subsection (2) shall not require the notification by him of the occurrence of an event before that time; and that subsection shall not require the notification by a person of the occurrence of an event whose occurrence comes to his knowledge after he has ceased to be a director or secretary.

(7) A person who fails to fulfil, within the proper period, an obligation to which he is subject by virtue of subsection (1) or (2) shall be guilty of an offence.

(8) An obligation imposed by this section shall be treated as not being fulfilled unless the notice by means of which it purports to be fulfilled is expressed to be given in fulfilment of that obligation.

(9) This section applies to shadow directors as to directors, but the making of a notification by a person under this section shall not, in itself, be proof that the person making the notification is a shadow director.

(10) Nothing in this section shall operate so as to impose an obligation with respect to shares in a body corporate which is the wholly owned subsidiary of another body corporate; and for this purpose a body corporate shall be deemed to be the wholly owned subsidiary of another if it has no members but that other and that other's wholly owned subsidiaries and its or their nominees.

(11) This section and sections 54 , 56 , 57 and 59 shall have effect in place of section 190 of the Principal Act and of so much of section 193 of that Act as relates to section 190, and that section and so much of section 193 as relates thereto shall, accordingly, cease to have effect.

Nature of an interest within section 53 .

54.—(1) The provisions of this section shall apply in determining for the purposes of section 53 whether a person has an interest in shares or debentures.

(2) Any reference to an interest in shares or debentures shall be read as including a reference to any interest of any kind whatsoever in shares or debentures; and accordingly there shall be disregarded any restraints or restrictions to which the exercise of any right attached to the interest is or may be subject.

(3) Where any property is held on trust and any interest in shares or debentures is comprised in that property, any beneficiary of that trust who, apart from this subsection, does not have an interest in the shares or debentures shall be taken to have such an interest; but this subsection is without prejudice to the following provisions of this section.

(4) A person shall be taken to have an interest in shares or debentures if—

(a) he enters into a contract for their purchase by him (whether for cash or other consideration); or

(b) not being the registered holder, he is entitled to exercise any right conferred by the holding of those shares or debentures or is entitled to control the exercise of any such right.

(5) A person shall be taken to be interested in shares or debentures if a body corporate is interested in them and—

(a) that body corporate or its directors are accustomed to act in accordance with his directions or instructions; or

(b) he is entitled to exercise or control the exercise of one-third or more of the voting power at general meetings of that body corporate.

(6) Where a person is entitled to exercise or control the exercise of one-third or more of the voting power at general meetings of a body corporate and that body corporate is entitled to exercise or control the exercise of any of the voting power at general meetings of another body corporate (the “relevant voting power”), then, for the purposes of subsection (5) (b), the relevant voting power shall be taken to be exercisable by that person.

(7) A person shall be taken to have an interest in shares or debentures if, otherwise than by virtue of having an interest under a trust—

(a) he has a right to call for delivery of the shares or debentures to himself or to his order; or

(b) he has a right to acquire an interest in shares or debentures or is under an obligation to take an interest in shares or debentures;

whether in any case the right or obligation is conditional or absolute.

(8) For the purposes of subsection (4) (b) a person shall be taken to be entitled to exercise or control the exercise of any right conferred by the holding of shares or debentures if he has a right (whether subject to conditions or not) the exercise of which would make him so entitled or is under an obligation (whether so subject or not) the fulfilment of which would make him so entitled.

(9) A person shall not by virtue of subsection (4) (b) be taken to be interested in any shares or debentures by reason only that he has been appointed a proxy to vote at a specified meeting of a company or of any class of its members and at any adjournment of that meeting or has been appointed by a body corporate to act as its representative at any meeting of a company or of any class of its members.

(10) Without prejudice to subsection (2), rights or obligations to subscribe for any shares or debentures shall not be taken for the purposes of subsection (7) to be rights to acquire, or obligations to take, any interest in shares or debentures.

(11) Where persons have a joint interest each of them shall be deemed to have that interest.

(12) It is immaterial that shares or debentures in which a person has an interest are unidentifiable.

(13) Delivery to a person's order of shares or debentures in fulfilment of a contract for the purchase thereof by him or in satisfaction of a right of his to call for delivery thereof, or failure to deliver shares or debentures in accordance with the terms of such a contract or on which such a right falls to be satisfied, shall be deemed to constitute an event in consequence of the occurrence of which he ceases to be interested in them, and so shall the lapse of a person's right to call for delivery of shares or debentures.

Interests to be disregarded.

55.—(1) The following interests shall be disregarded for the purposes of section 54 and sections 56 to 58 —

(a) where property is held on trust and an interest in shares or debentures is comprised in that property, an interest in reversion or remainder or of a bare trustee and any discretionary interest;

(b) an interest of a person subsisting by virtue of—

(i) his holding units in—

(I) a registered unit trust scheme within the meaning of section 3 of the Unit Trusts Act, 1972 ;

(II) a unit trust to which section 31 of the Capital Gains Tax Act, 1975 , as amended by section 34 of the Finance Act, 1977 relates;

(III) an undertaking for collective investment in transferable securities, within the meaning of the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations, 1989 ( S.I. No. 78 of 1989 );

(ii) a scheme made under section 46 of the Charities Act, 1961 ;

(c) an interest for the life of himself or another of a person under a settlement in the case of which the property comprised in the settlement consists of or includes shares or debentures, and the conditions mentioned in subsection (3) are satisfied;

(d) an interest in shares or debentures held by a member of a recognised stock exchange carrying on business as a stock broker which is held by way of security only for the purposes of a transaction entered into by the person or body concerned in the ordinary course of business of such person or body;

(e) such interests, or interests of such a class, as may be prescribed for the purposes of this paragraph by regulations made by the Minister.

(2) A person shall not by virtue of section 54 (4) (b) be taken to be interested in shares or debentures by reason only that he has been appointed a proxy to vote at a specified meeting of a company or of any class of its members and at any adjournment of that meeting, or has been appointed by a body corporate to act as its representative at any meeting of a company or of any class of its members.

(3) The conditions referred to in subsection (1) (c) are, in relation to a settlement—

(a) that it is irrevocable, and

(b) that the settlor (within the meaning of section 96 of the Income Tax Act, 1967 ) has no interest in any income arising under, or property comprised in, the settlement.

Periods within which obligations under section 53 must be discharged.

56.—(1) An obligation imposed on a person by section 53 (1) to notify an interest must, if he knows of the existence of the interest on the relevant day (that is to say, in a case in which he is a director or secretary at the beginning of the day on which that section comes into operation, the last previous day, and, in a case in which he thereafter becomes a director or secretary, the day on which he becomes it), be fulfilled before the expiration of the period of five days beginning with the day next following the relevant day; otherwise it must be fulfilled before the expiration of the period of five days beginning with the day next following that on which the existence of the interest comes to his knowledge.

(2) An obligation imposed on a person by section 53 (2) to notify the occurrence of an event must, if at the time at which the event occurs he knows of its occurrence, be fulfilled before the expiration of the period of five days beginning with the day next following that on which it occurs; otherwise, it must be fulfilled before the expiration of the period of five days beginning with the day next following that on which the occurrence of the event comes to his knowledge.

Circumstances in which obligation under section 53 is not discharged.

57.—(1) Where an event of whose occurrence a director or secretary is, by virtue of section 53 (2) (a), under obligation to notify a company consists of his entering into a contract for the purchase by him of shares or debentures, the obligation shall be taken not to be discharged in the absence of inclusion in the notice of a statement of the price to be paid by him under the contract, and an obligation imposed on a director or secretary by virtue of section 53 (2) (b) shall be taken not to be discharged in the absence of inclusion in the notice of the price to be received by him under the contract.

(2) An obligation imposed on a director or secretary by virtue of section 53 (2) (c) to notify a company shall be taken not to be discharged in the absence of inclusion in the notice of a statement of the consideration for the assignment (or, if it be the case that there is no consideration, that fact), and where an event of whose occurrence a director is, by virtue of section 53 (2) (d), under obligation to notify a company consists in his assigning a right, the obligation shall be taken not to be discharged in the absence of inclusion in the notice of a similar statement.

(3) Where an event of whose occurrence a director or secretary is, by virtue of section 53 (2) (d), under obligation to notify a company consists in the grant to him of a right to subscribe for shares or debentures, the obligation shall not be taken to be discharged in the absence of inclusion in the notice of a statement of—

(a) the date on which the right was granted,

(b) the period during which or time at which the right is exercisable,

(c) the consideration for the grant (or, if it be the case that there is no consideration, that fact), and

(d) the price to be paid for the shares or debentures.

(4) Where an event of whose occurrence a director or secretary is, by virtue of section 53 (2) (d), under obligation to notify a company consists in the exercise of a right granted to him to subscribe for shares or debentures, the obligation shall be taken not to be discharged in the absence of inclusion in the notice of a statement of—

(a) the number of shares or amount of debentures in respect of which the right was exercised, and

(b) if it be the case that they were registered in his name, that fact, and, if not, the name or names of the person or persons in whose name or names they were registered,

together (if they were registered in the names of two persons or more) with the number or amount thereof registered in the name of each of them.

(5) For the purposes of this section any reference, however expressed, to any price paid, given or received in respect of any interest in shares or debentures shall be construed as including a reference to any consideration other than money given or received in respect of any such interest.

Other provisions relating to notification.

58.—(1) Where a person authorises any other person (“the agent”) to acquire or dispose of, on his behalf, interests in shares in, or debentures of, a company, he shall secure that the agent notifies him immediately of acquisitions or disposals of interests in such shares or debentures effected by the agent which will or may give rise to any obligation on his part to make a notification under this Chapter with respect to his interest in those shares or debentures.

(2) An obligation to make any notification imposed on any person by this Chapter shall be treated as not being fulfilled unless the notice by means of which it purports to be fulfilled identifies him and gives his address.

(3) Where a person fails to fulfil, within the proper period, an obligation to which he is subject by virtue of section 53 , no right or interest of any kind whatsoever in respect of the shares or debentures concerned shall be enforceable by him, whether directly or indirectly, by action or legal proceeding.

(4) Where any right or interest is restricted under subsection (3), any person in default under that subsection or any other person affected by such restriction may apply to the court for relief against a disability imposed by or arising out of subsection (3) and the court on being satisfied that the default was accidental, or due to inadvertence, or some other sufficient cause, or that on other grounds it is just and equitable to grant relief, may grant such relief either generally, or as respects any particular right or interest on such terms and conditions as it sees fit.

(5) Where an applicant for relief under subsection (4) is a person referred to in subsection (3), the court may not grant such relief if it appears that the default has arisen as a result of any deliberate act or omission on the part of the applicant.

(6) Subsection (3) shall not apply to an obligation relating to a person ceasing to be interested in shares in, or debentures of, a company.

(7) A person who fails without reasonable excuse to comply with subsection (1) shall be guilty of an offence.

Register of interests.

59.—(1) Every company shall keep a register for the purposes of section 53 .

(2) Whenever the company receives information from a director or secretary in consequence of the fulfilment of an obligation imposed on him by that section, the company shall enter in the register, against the name of that person, that information and the date of the entry.

(3) Every company shall, whenever it grants to a director or secretary a right to subscribe for shares in, or debentures of, the company, enter in the register against his name—

(a) the date on which the right is granted,

(b) the period during which or time at which it is exercisable,

(c) the consideration for the grant (or, if it be the case that there is no consideration, that fact), and

(d) the description of shares or debentures involved and the number or amount thereof, and the price to be paid therefor.

(4) Whenever such a right as is mentioned in subsection (3) is exercised by a director or secretary, the company shall enter in the said register against his name that fact (identifying the right), the number or amount of shares or debentures in respect of which it is exercised and, if it be the case that they were registered in his name, that fact, and, if not, the name or names of the person or persons in whose name or names they were registered, together (if they were registered in the names of two persons or more) with the number or amount thereof registered in the name of each of them.

(5) This section applies to shadow directors as to directors.

Provisions relating to register.

60.—(1) The register to be kept under section 59 shall be so made up that the entries therein against the several names inscribed therein appear in chronological order.

(2) An obligation imposed by section 59 (2) to (4) shall be fulfilled before the expiration of the period of 3 days beginning with the day next following that on which it arises.

(3) The nature and extent of an interest recorded in the said register of a director or secretary in any shares or debentures shall, if he so requires, be recorded in the said register.

(4) The company shall not, by virtue of anything done for the purposes of this section, be affected with notice of, or put upon inquiry as to, the rights of any person in relation to any shares or debentures.

(5) The said register shall—

(a) if the company's register of members is kept at its registered office, be kept there;

(b) if the company's register of members is not so kept, be kept at the company's registered office or at the place where its register of members is kept;

and shall during business hours (subject to such reasonable restrictions as the company in general meeting may impose, so that not less than two hours in each day be allowed for inspection) be open to the inspection of any member of the company without charge and of any other person on payment of 30p or such less sum as the company may prescribe for each inspection.

(6) The company shall send notice to the registrar of companies of the place where the said register is kept and of any change in that place, save in a case in which it has at all times been kept at its registered office.

(7) Unless the said register is in such a form as to constitute in itself an index, the company shall keep an index of the names entered therein which shall—

(a) in respect of each name, contain a sufficient indication to enable the information inscribed against it to be readily found; and

(b) be kept at the same place as the said register;

and the company shall, within 14 days after the date on which a name is entered in the said register, make any necessary alteration in the index.

(8) Any member of the company or other person may require a copy of the said register, or of any part thereof, on payment of 15p or such less sum as the company may prescribe, for every hundred words or fractional part thereof required to be copied.

The company shall cause any copy so required by any person to be sent to that person within the period of 10 days beginning with the day next following that on which the requirement is received by the company.

(9) The said register shall also be and remain open and accessible to any person attending the company's annual general meeting at least one quarter hour before the appointed time for the commencement of the meeting and during the continuance of the meeting.

(10) If default is made in compliance with subsection (9), the company and every officer of the company who is in default shall be guilty of an offence and shall be liable to a fine not exceeding £1,000; and if default is made for 14 days in complying with subsection (6) the company and every officer of the company who is in default shall be liable to a fine not exceeding £1,000; and if default is made in complying with section 59 or with subsection (1), (2) or (7) of this section or if an inspection required under this section is refused or any copy required thereunder is not sent within the proper period the company and every officer of the company who is in default shall be liable to a fine not exceeding £1,000.

(11) In the case of a refusal of an inspection required under this section of the said register, the court may by order compel an immediate inspection thereof; and in the case of a failure to send within the proper period a copy required under this section, the court may by order direct that the copy required shall be sent to the person requiring it.

Removal of entries from register.

61.—(1) A company may remove an entry against a person's name from the register of interests in shares and debentures kept under section 59 if more than 6 years has elapsed since the date of the entry being made, and either—

(a) that entry recorded the fact that the person in question has ceased to have an interest notifiable under this Chapter in shares in, or debentures of, the company, or

(b) it has been superseded by a later entry made under the said section 59 against the same person's name;

and in a case within paragraph (a) the company may also remove that person's name from the register.

(2) Where a name is removed from a company's register of interests in shares or debentures in pursuance of subsection (1), the company shall within 14 days of the date of that removal make any necessary alterations in any associated index.

(3) If default is made in complying with subsection (2), the company and every officer of it who is in default shall be guilty of an offence and liable to a fine.

Entries, when not to be removed.

62.—(1) Entries in a company's register of interests in shares and debentures under this Chapter shall not be deleted except in accordance with section 61 .

(2) If an entry is deleted from a company's register of interests in shares in contravention of subsection (1), the company shall restore that entry to the register as soon as is reasonable and practicable.

(3) If default is made in complying with subsection (1) or (2), the company and every officer of it who is in default shall be guilty of an offence and liable to a fine.

Disclosure of interests in directors' report.

63.—(1) Subject to subsection (2), the directors' report or the notes to the company's accounts in respect of a financial year shall, as respects each person who, at the end of that year, was a director of the company, state—

(a) whether or not he was, at the end of that year, interested in shares in, or debentures of, the company or any other body corporate being the company's subsidiary or holding company or a subsidiary of the company's holding company;

(b) if he was so interested—

(i) the number and amount of shares in, and debentures of, each body (specifying it) in which he was then interested,

(ii) whether or not he was, at the beginning of that year (or, if he was not then a director, when he became a director), interested in shares in, or debentures of, the company or any other such body corporate, and,

(iii) if he was, the number and amount of shares in, and debentures of, each body (specifying it) in which he was interested at the beginning of that year or, as the case may be, when he became a director.

(2) The reference in subsection (1) to the directors' report and the notes to the company's accounts are references to the report and notes respectively which are required by virtue of the Companies (Amendment) Act, 1986 to be annexed to the Annual Return and where a company does not annex the report of the directors, as permitted by section 10 (2) of the aforementioned Act, the information required in subsection (1) shall be contained in the notes to the company's accounts.

(3) The references in subsection (1) to the time when a person became a director shall, in the case of a person who became a director on more than one occasion, be construed as referring to the time when he first became a director.

(4) For the purposes of this section “the directors' report” means the report by the directors of a company which, by section 158 (1) of the Principal Act, is required to be attached to every balance sheet of the company.

(5) The information required by subsection (1) to be given in respect of the directors of the company shall also be given in respect of the person who was the secretary of the company at the end of the financial year concerned.

Extension of section 53 to spouses and children.

64.—(1) For the purposes of section 53 —

(a) an interest of the spouse of a director or secretary of a company (not being himself or herself a director or secretary thereof) in shares or debentures shall be treated as being the director's or secretary's interest, and

(b) the same applies to an interest of a minor child of a director or secretary of a company (not being himself or herself a director or secretary thereof) in shares or debentures.

(2) For those purposes—

(a) a contract, assignment or right of subscription entered into, exercised or made by, or grant made to, the spouse of a director or secretary of a company (not being himself or herself a director or secretary thereof) shall be treated as having been entered into, exercised or made by, or, as the case may be, as having been made to, the director or secretary, and

(b) the same applies to a contract, assignment or right of subscription entered into, exercised or made by, or grant made to, a minor child of a director or secretary of a company (not being himself or herself a director or secretary thereof).

(3) A director or secretary of a company shall be under obligation to notify the company in writing of the occurrence, while he or she is director or secretary, of either of the following events, namely—

(a) the grant to his or her spouse or minor child by the company, of a right to subscribe for shares in, or debentures of, the company; and

(b) the exercise by the spouse or minor child of such a right as aforesaid granted by the company to the spouse or child.

(4) In a notice given to the company under subsection (3) there shall be stated—

(a) in the case of the grant of a right, the like information as is required by section 53 to be stated by the director or secretary on the grant to him by another body corporate of a right to subscribe for shares in, or debentures of, that other body corporate, and

(b) in the case of the exercise of a right, the like information as is required by that section to be stated by the director or secretary on the exercise of a right granted to him by another body corporate to subscribe for shares in, or debentures of, that other body corporate.

(5) An obligation imposed by subsection (3) on a director or secretary must be fulfilled by him before the expiration of the period of 5 days beginning with the day next following that on which the occurrence of the event that gives rise to it comes to his knowledge.

(6) A person who fails to fulfil, within the proper period, an obligation to which he is subject under subsection (3) shall be guilty of an offence.

(7) The provisions set out in sections 54 and 55 shall have effect for the interpretation of, and otherwise in relation to, subsections (1) and (2), and subsections (8) and (9) of section 53 shall, with any requisite modification, have effect for the purposes of this section as they have effect for the purposes of that section.

(8) For the purposes of section 59 an obligation imposed on a director or secretary by this section shall be treated as if imposed by section 53 .

Duty of company to notify stock exchange.

65.—(1) Whenever a company in the case of whose shares or debentures dealing facilities are provided by a recognised stock exchange is notified of any matter by a director or secretary in consequence of the fulfilment of an obligation imposed on him by section 53 or 64 , and that matter relates to shares or debentures for which such dealing facilities are provided, the company shall be under an obligation to notify that stock exchange of that matter; and the stock exchange may publish, in such manner as it may determine, any information received by it under this subsection.

(2) An obligation imposed by subsection (1) must be fulfilled before the end of the day next following that on which it arises.

(3) If default is made in complying with this section, the company and every officer of the company who is in default shall be guilty of an offence.

Investigation of share dealing.

66.—(1) If it appears to the Minister that there are circumstances suggesting that contraventions may have occurred, in relation to shares in, or debentures of, a company, of section 30 , 53 or 64 (3) to (5) he may appoint one or more competent inspectors to carry out such investigations as are requisite to establish whether or not contraventions have occurred as aforesaid and to report the result of their investigations to the Minister.

(2) The appointment under this section of an inspector may limit the period to which his investigation is to extend or confine it to shares or debentures of a particular class or both.

(3) For the purposes of any investigation under this section, section 10 shall apply—

(a) with the substitution, for references to any other body corporate whose affairs are investigated by virtue of section 9 , of a reference to any other body corporate which is, or has at any relevant time been, the company's subsidiary or holding company, and

(b) with the necessary modification of the reference, in section 10 (5), to the affairs of the company or other body corporate, so, however, that it shall apply to members of a recognised stock exchange who are individuals and to officers (past as well as present) of members of such an exchange who are bodies corporate as it applies to officers of the company or of the other body corporate.

(4) The inspectors may, and, if so directed by the Minister, shall, make interim reports to the Minister, and, on the conclusion of the investigation, shall make a final report to the Minister.

(5) Any such report shall be written or printed, as the Minister may direct, and the Minister may cause it to be published.

(6) Sections 9 , 16 to 18 , 22 , 23 (1) and 23 (3) shall, with any necessary modifications, apply for the purposes of this section.

(7) The expenses of an investigation under this section shall be defrayed by the Minister.

(8) Where a person is convicted of an offence on a prosecution instituted as a result of the investigation the High Court may, on the application of the Minister, order that person to pay the said expenses to such extent as the court may direct.

Chapter 2

Individual and Group Acquisitions