Legislation provides additional breathing space to struggling businesses and continuity for businesses to the end of this year.
The Irish Government has made changes to the Companies Act 2020 that will see examinership extended to 150 days and maintains the use of virtual AGMs.
The interim period of the Companies (Miscellaneous Provisions) (Covid-19) Act 2020 has been further extended to 31 December 2022 following Government approval this week. The Act makes temporary amendments to the Companies Act 2014 and the Industrial and Provident Societies Act 1893 to address issues arising as a result of Covid-19.
“The further extension of these important measures is very much focused on ensuring that businesses are provided with adequate time to recover from the difficult trading circumstances of the pandemic”
The Act makes provision in respect of business solvency by increasing the period of examinership to 150 days and increasing the threshold at which a company is deemed unable to pay its debts to €50,000.
The Act also extends the provisions allowing 240,000 companies and 950 industrial and provident societies in Ireland to hold their Annual General Meetings (AGMs) and general meetings by electronic means. The continuation of these important amendments will provide additional breathing space to struggling businesses and provide continuity for businesses to the end of this year.
Relieving the pressure
“I am pleased to confirm Government has approved the extension of important temporary provisions to assist struggling or recovering businesses by increasing the period of examinership to 150 days and increasing the threshold at which a company is deemed unable to pay its debts to €50,000,” Minister for Trade Promotion, Company Regulation and Digital, Robert Troy, TD, said.
“I expect that this will likely be the final extension of these temporary provisions. I would stress that the underlying motivation for the further extension of these important measures is very much focused on ensuring that businesses are provided with adequate time to recover from the difficult trading circumstances of the pandemic.
“While I and the Government greatly welcome the return to growth and the very positive figures we are seeing for many sectors across the economy, it is nevertheless difficult to quantify and ascertain the condition of many businesses, small businesses in particular, following the extensive shuttering of large parts of the economy. Previous analysis by the World Bank has indicated that it can take a number of years before the economic impact of disruptive events work their way through the system. So, while we are buoyed by the positive economic news, we are also mindful that other challenges may emerge and for this reason caution is still warranted.
“While this is likely to be the final extension of these particular measures, work is continuing to put virtual AGMs and general meetings on a permanent statutory footing. Government and I will continue to support Irish businesses across the spectrum of Government activity to ensure that our economy and our businesses prosper.”