The Minister for Business, Enterprise and Innovation has made the Companies (Accounting) Act 2017 (Commencement) Order 2018. This order appoints 9 June 2018 as the day on which section 80 of the Companies (Accounting) Act 2017 (the "2017 Act") comes into operation.
Definition of external company – the current position
Section 1300(1) of the Companies Act 2014 (the "2014 Act") defines an 'external company' as 'an EEA company or a non-EEA company'.
'EEA company' is defined as a body corporate whose members' liability is limited, which is incorporated in an EEA state.
'Non-EEA company' is defined as a body corporate whose members' liability is limited, which is incorporated in a state that is not an EEA state.
Therefore a company is required to have limited liability in order to fall within the current definition of an external company.
Definition of external company – the new position
Section 80 of the 2017 Act substitutes new definitions into section 1300(1) of the 2014 Act for 'EEA company' and 'Non-EEA company'. Under the new Section 1300(1), the definitions of 'EEA company' and 'Non EEA company' are broadened and will also include undertakings whose members liability is unlimited, and which is a subsidiary undertaking of a body corporate whose members' liability is limited.
Impact of new definition
Prior to this amendment, under Part 21 of the 2014 Act, only foreign body corporates with limited liability with a branch established in Ireland must register certain details with the Companies Registration Office (CRO) and file financial statements annually. With effect from 9 June 2018, foreign body corporates, including undertakings (partnerships and unincorporated bodies) with unlimited liability with a branch in Ireland, will fall within the definition of external companies. Therefore, where a body corporate or undertaking falls within the new definition of external company and has a branch in Ireland, it will be obliged to register details with the CRO and file financial statements annually.