CRO cracks down on lax companies

By Andrew Bushe

DUBLIN — A new get-tough policy on compliance with company law is leading to tens of thousands of companies being axed from the country’s register after decades of poor enforcement.

The Companies Registration Office began its campaign in September 1998 and, in the following six months, 27,000 companies bit the dust. The strike-offs were supplemented by a program of prosecutions.

Laws enacted last year tightened the screw further and, with extended powers, the CRO has stepped up its crackdown.

The new strike-off program cuts down the number of warnings needed and the CRO is now publishing a weekly list of those companies that have a month to get their affairs in order.

The latest list to be posted in the Office’s website contains more than 4,000 names.

Once the strike-off process has begun, it will not be halted until all outstanding returns have been filed.

The effect of the new provisions is that any company that has not filed a 1999 return is liable to strike off, a spokesman said.

A strike off for companies that have not filed their annual returns has serious consequences and directors are also liable for prosecution. Efforts to restore the company to the register can be expensive and involve proceedings in the High Court.

Even if a company is dissolved, every director, officer and member of the company continues to face responsibility for any outstanding liabilities and these may be enforced.

If the company is struck off but still trading, it means the directors lose the protection of limited liability, the assets of the company become the property of the state, and the banks will not extend credit facilities.