The Gazette 1992

GAZETTE

JUNE 1992

Registration of Charges:

Foreign Companies and the

Slavenburg

File

by Thomas B. Courtney B.A., LL.B.

of Hanby Wallace, Solicitors

1. Introduction

S.99 (1) Companies Act, 1963

provides that particulars of certain

charges which are enumerated in

S.99 (2) must, within a period of 21

days from the creation of the charge,

be delivered to the Registrar of

Companies. Failure to register what

is a registrable charge means that

that charge, while remaining

enforceable against the company

which created it, is void against the

liquidator and any creditor of the

company.

Non-registration of a registrable

charge, enumerated in S.99 (2) does

not vitiate that charge, but makes it

void against a liquidator or creditor

of the company. That it remains

enforceable is evidenced by the fact

that where a registrable charge is not

registered, the money secured thereby

becomes immediately due and

payable. Essentially, non-registration

means that the charge holder loses

priority to other creditors, both

secured and unsecured. Where the

company creating the charge is Irish,

the pitfalls are readily appreciated.

However, where the company

creating the charge is a foreign

company i.e. one which is registered

under the laws of another country,

and the property comprised in the

charge is situate in Ireland, extreme

care must be taken to ensure that the

requirements of S.lll of Part IV of

the Companies Act, 1963 are

complied with.

The Law Summarised

Charges created by foreign

companies, concerning foreign

property are of no concern to Irish

law. Their validity will be determined

by the

lex situs.

Thomas B. Courtney

Charges created by foreign

companies over property in the State

require to be registered under Part

IV Companies Act, 1963 where such

companies have an established place

of business in the State.

Furthermore, this remains the case

even though such foreign companies

have not registered on the Irish

external register of companies, as

they should if they have an

established place of business in the

State. Where charges are created by

that company or property is acquired

by that company which is subject to

a charge, and they are not registered

then they will be void against a

liquidator or creditor of the

company. In the case of judgement

mortgages obtained against that

company but not registered, then the

holder of the judgement mortgage

will be liable to a fine not exceeding

£500.

S.lll Companies Act, 1963

provides

"The provisions of [Part IV] shall

extend to charges on property in the

State which are created. . . and to

charges on property in the State which is

acquired. . . by a company incorporated

outside the State which has an

established place of business within the

State, and to judgement mortgages

created. . . and affecting property in the

State of such a company and to

receivers, appointed. . . of property in

the State of such a company, and for the

purposes of those provisions, the

principal place of business of such a

company in the State shall be deemed to

be its registered office."

Companies Registered on the

External Register

Foreign, or "external" companies

which establish a place of business

in the State are

obliged

to register

with the Registrar of Companies by

S.352 (1) Companies Act, 1963,

which provides as follows:

"Companies incorporated outside the

State, which, after the operative date,

establish a place of business within the

State, shall, within one month of the

establishment of the

place.of

business,

deliver to .the registrar of companies for

registration -

(a) a certified copy of the charter,

statutes or memorandum and articles

of the company, or other instrument

constituting or defining the

constitution of the company, and, if

the instrument is not written in the

English or Irish language, a certified

translation thereof;

(b) a list of the directors and secretary

of the company containing the

particulars mentioned in subsection

(2);

or more persons resident in the State

authorised to accept on behalf of the

company service of process and any

notices required to be served on the

company and also the address of the

company's principal place of business

in the State."

The mechanics of

registration

are as

follows. Three forms must be

completed specifying the foregoing

information.

These must be

accompanied by the company's

Memorandum and Articles of

Association. All such documentation

must be

certified

by, for example a

Notary Public or the Registrar of

Companies in that country etc. In

addition, such documents must also

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