Last week saw the signing into law of new regulations on Public Limited Companies (PLCs).

The new Regulations (SI No 89/2008), which took effect yesterday, 15 April 2008, transpose certain mandatory elements of the European Communities (Public Limited Companies – Directive 2006/68/EC)) not already provided for in our national legislation dealing with Public Limited Companies(PLC's).

The effect of these Regulations is to amend the Companies Acts in two areas. The first of these is an amendment to the provisions of the 1963 Act dealing with objections by creditors to Court Orders confirming a reduction by a company of its issued share capital. These are being amended to reflect the change in emphasis in the Directive in respect of public companies, shifting the burden of proof from the company to the creditors in establishing grounds for an objection to the Court Order. Secondly, Part XI of the 1990 Act dealing with the purchase by a company of its own shares is also being amended.

According to Minister for Enterprise, Trade and Employment Micheál Martin, these amendments are essentially for clarification purposes and do not give rise any changes of substance to the basic rules currently applying to purchase of own shares. The Company Law Consolidation and Reform Bill, which is currently being drafted in the Office of the Parliamentary Counsel, will deal comprehensively with PLC's, including the amendments arising from Directive 2006/68/EC. However, as it will be some time yet before this Bill is enacted it is necessary to introduce interim measures to ensure that Ireland complies fully with those mandatory requirements of the Directive by the due date of transposition, namely yesterday, Tuesday 15 April 2008.

Minister Martin said that the signing into law of the Regulations would ensure that Ireland is in compliance with our obligations under the Directive by the due date, namely 15 April 2008. He added that the upcoming Bill would provide an opportunity for the overall provisions of the Directive to be considered in detail, in the course of which decisions would be taken on whether it made sense to take on board some or all of the optional elements of the measure, having regard to the interests of the various stakeholders involved.

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