With the possibility of a no deal Brexit now a likely outcome, UK/NI businesses are monitoring closely their Brexit strategy especially for a worst case scenario. They are currently executing plans to set up branches and subsidiary operations within European countries such as Ireland while planning and implementing all the logistical requirements involved including the appointment of Directors, outsourcing, premises and staffing requirements.
While we have seen high profile media attention announced in relation to large entities moving operations to Ireland such as Barclays, JP Morgan, Bank of america , Lloyds and a number of asset managers, there has also been alot of activity with smaller firms looking to keep business access to the European Single Market by setting up an Irish subsidiary entity. The number of new companies setting up in Ireland each week is at an all time high with over 400 companies established on average each week which includes a number of UK/NI companies who have already made a strategic decision that they need to have an alternative option available due to the uncertainty that Brexit has brought to their businesses. This will allow them to have the infrastructure in place to continue to trade with their European customers and can leverage off the expertise that using a partnered corporate service provider can assist in getting everything established in a shorter time frame.
Existing companies registered here in Ireland with sole UK directors on the board will also be impacted as under the Companies Act every Irish Company must have an EEA resident director on the board and if this cannot be satisfied then an Insurance bond will have to be put in place or the company should try and obtain a real and continuous link certificate. We have also seen many Northern Irish Companies looking to set up across the border while many UK auditing firms will also be impacted by Brexit and will have to implement strategic partnership arrangements. UK/NI companies should review their board composition if they have Irish or other European companies set up to ensure they comply with EU legislation.
As a result of this we have seen a strong demand for employers looking for talented individuals to join their organisations but there is also a strong demand for experienced Independent Non-Executive Directors (“INED’s”) along with a corporate service provider to assist the organisations. These can provide the local expertise and knowledge to oversee their business setup while assisting with any regulatory or legal issues that may arise. It is recommended that the independent director should be from outside of the company, not have any day to day management responsibilities and provide an independent voice and perspective to the board so to be impartial in decision making and always have the companies interest at the forefront.
With the Irish Central Bank monitoring Non-Executive Directors closely, especially those that are sitting on regulated entities, it has meant that Directors time and capacity has become a valuable resource. As a result with the strong demand for Director services, whether as an independent person or to sit on a governance board of large organisations, consideration needs to be given to the restricting circumstances that an appointment may bring. Under Irish legislation there is a restriction on the amount of directorships that any one person can hold, currently 25 companies, at any one time unless the company holds a real and continuous link certificate from the registrar of companies. This does not apply to all types of companies as certain companies such as a Public Companies, certain banking institutions and investment companies are excluded as a countable directorship for this restriction.
This has led to the pool of available experienced directors decreasing while the demand is ever growing in such areas as funds, aviation and financial services companies. Directors need to consider the potential relationship that they are entering into and any restrictions this may pose to future opportunities or conflicts of interest.
Amstrow has established the first dedicated INED service in Ireland to assist Non-Executive Directors, International companies and lawyers with sourcing and appointing relevant professionals to these various roles. We have a large number of INED’s registered with us and are assisting companies find suitably qualified people to sit on their boards while also sourcing qualified employees to the new companies. We have a dedicated company formation team and our corporate service company can assist with ongoing administration matters. To discuss how we can help with your Brexit plans contact us at https://amstrow.com/contact-us/ or if you are interested in registering as a non-executive director with us please go to the attached registration area: https://amstrow.com/hrm-solutions/independent-non-exec-directors/