The Companies (Accounting) Bill 2016 (the "Bill") was debated and passed by the Dáil last week. The Bill proposes to amend the Companies Act 2014 and one of the amendments debated last week could, if enacted, affect how Irish unlimited companies use their names.
The Companies Act 2014 (the "Act") introduced a requirement that an unlimited company must use the words "unlimited company" (or the Irish equivalent) in its name. This requirement applies to both public and private unlimited companies. A more detailed briefing on this is available here.
The requirement applies unless the unlimited company has secured an exemption from including these words in its name under section 1237(5) of the Act. This provides that if special circumstances exist which render it, in the opinion of the Minister, expedient to grant an exemption from use of the words, the Minister may do so.
Last week in the Dil it was agreed to amend the Bill so that on its enactment, the right to apply for an exemption would be removed from the Act. It appears from the debates that this proposed amendment is not intended to affect an exemption already granted under the Act. However, from enactment, no further exemption could be granted under the Act. The Bill is expected in the Seanad early next month and if this amendment is unchanged there, it will be enacted.
Once enacted, any unlimited company with an exemption from use of "unlimited company" for a specific time period will need to plan for the inclusion in its name of these words (or the inclusion of their abbreviated form such as "uc") before that exemption expires. Unlimited companies with exemptions should also consider these in the context of future corporate restructurings.