Again reflecting the simplified structural concept, Volume 1 is arranged to reflect the life cycle of the company, beginning with how a company is set up, followed by the provisions which apply when the company is in operation and, finally, the provisions which are relevant to closing the company down. Volume 2, comprising Parts 16 to 25 of the Bill and its Schedules, goes on to state how the law contained in Volume 1 is applied, disapplied or varied for each other company type. These other company types are the designated activity company, the public limited company, the guarantee company, the unlimited company, the unregistered company and the investment company. There are legitimate users of all the different company types laid down in the Bill and it is imperative that Irish company law should facilitate business and the wider community by making appropriate provision for different types of companies. For the new limited company, the Bill contains a number of significant reforms. This company will have the same legal capacity as a natural person. The current ultra vires rule does not apply to this new company type - the ultra vires rule is the legal doctrine whereby a company must have an "objects clause" in its memorandum of association. This "objects clause" lists the activities which the company has power to undertake, with the consequence that any other activities are regarded as being beyond the powers of, or ultra vires, the company. In practice, this can lead to companies drawing up exhaustive objects clauses to be certain they have the relevant powers, and can in some cases lead to legal disputes as to whether a company actually had power to undertake a certain activity. Removing the need for an objects clause will both ease the administrative burden on companies and provide certainty to third parties, such as lenders, who will no longer have to examine extensive objects clauses to determine whether a company is acting within its powers. This company type will be allowed to have only one director. Under the current law, a company must have at least two directors. Even if one wishes to establish a business as a company on his or her own, he or she needs to find an additional person to act as the second director. Removing this requirement will make it easier to start a new business. The new limited company can have a minimum of one member and up to a maximum of 149 members. The 149 upper-limit is linked to the requirements of EU prospectus law, which governs the offer of shares to the public. The new limited company will have a single-document constitution, in contrast to the current law whereby every company must have two documents - a memorandum of association and separate articles of association. A further benefit of the new legislation will be that the extensive and detailed provisions which every company currently needs to include in its own articles of association will now be brought into the main body of the legislation and will apply to each company by default. However, most of these provisions can be modified by an individual company, if required to suit their specific needs. The new limited company will no longer be obliged to go through the formality of holding a "physical" AGM, whereby all of the members have to convene in one location at the same time on an annual basis. Instead, the members will be able to hold a "written" AGM, whereby all of the matters which must be dealt with at the AGM can be approved by written procedure. The Bill contains a codified version of the fiduciary duties to which directors are currently subject by a combination of the common law and statutory provisions. This brings all of these duties together in a single identifiable place, making it easier for directors to understand their responsibilities and more difficult to deny their existence. This also addresses one of the recommendations of the Moriarty report in regard to company law. The Bill contains a "summary approval procedure", which is applicable to a number of activities - for example, reduction of capital - which under the current law might require the company to undertake the burdensome and expensive process of securing court approval. The new "summary approval procedure" incorporates safeguards in regard to directors' liability in circumstances where the procedure is used without proper justification. For the first time, all offences under company law have been streamlined under a new classification procedure which operates on the basis of four categories of offences, with category 1 being the most serious. This will bring a structure and consistency to the offence provisions throughout the legislation. For the first time, it will be possible to merge two Irish private companies under the new Bill. The procedure for this is modelled on the EU cross-border merger regulations, which are regarded as relatively straightforward to operate by the business and advisory community. Small companies will be able to apply directly to the Circuit Court for examinership instead of having to go through the High Court. This will make examinership more accessible and reduce costs. A number of innovations which will apply to other company types include the following. As already mentioned, each company type will have its own dedicated Part within the Bill, thereby improving the accessibility and visibility of the law for all users. Part 20 enables any company to convert from its existing company type to any other company type which can be formed under the Bill, in contrast to the current law, which contains restrictions on conversions. This provides flexibility and greater options to companies which face a change in their circumstances. For the first time, guarantee companies will be able to avail of the audit exemption. This innovation will be of significant benefit to the sectors which tend to use the guarantee company structure - for example, companies in the voluntary sector, charities and residential management companies - while at the same time recognising the particular circumstances applying to guarantee companies in allowing a single member to object. I now turn to the actual substance of the Bill. Due to the unprecedented size of this Bill, it is not possible within the allocated time to give a detailed explanation for each of the 1,429 sections, as Members will be pleased to hear. Instead, I will give an overview of the 25 constituent Parts of the Bill, along the way highlighting any significant changes to the law and explaining the policy behind these changes. The supplementary information provided to the Deputies contains a more detailed overview at chapter-by-chapter level. Part 1 consists of 14 sections and is largely devoted to housekeeping. It explains the structure of the Bill and it defines terms which are used throughout the Bill. Part 2 makes provision for the incorporation and registration of the new model private company limited by shares - the new limited company - and provides that any one or more persons may form such a company. The distinction between a memorandum of association and articles of association has been abolished in this Part for the new model company type and these two documents are combined into a single document called a "constitution". The most significant aspect of this Part is the provision for the conversion of an existing private company limited by shares to a new model private company limited by shares. Following the enactment of the Bill, existing private companies limited by shares will have to decide whether to opt in to the new regime for private limited companies or to opt out by becoming a designated activity company or other company type. Companies that do not elect to opt into the new regime will not be able to avail of the many advantages associated with the new model private company limited by shares, such as the ability to have only one director, the one-document constitution and the possibility to avoid a "physical" AGM. There are three ways in which an existing private company limited by shares can become this new model company type. The recommended option is for the members of the company to adopt a new constitution by special resolution. Schedule 1 sets out a template for this purpose to assist the company. As an alternative to the special resolution, the directors can send the new constitution to each of the members and deliver a copy to the Companies Registration Office. If the directors fail to take any action, the company will be deemed to have a constitution at the expiry of the transition period. A company is entitled to opt out of the new regime and can do so by converting to a designated activity company or other company type. Part 3 consolidates all existing law relating to shares, share capital and certain other instruments. At present, this law is set out across the three main Companies Acts. Many provisions from Table A of the First Schedule to the Companies Act 1963, which are commonly inserted into the articles of association of a company, are now incorporated into the text of the Bill and apply unless the company's constitution provides otherwise, thus reducing the amount of detail required in the constitution of the company. Part 4 deals with corporate governance and provides for the duties and responsibilities of directors and other officers as regards their appointment, their proceedings in regard to the company and its members and the ways in which the activities of the company on a day-to-day basis are conducted. The procedures for corporate governance currently contained in the standard articles of association for a company limited by shares have been incorporated into the body of the Bill. Additionally, the new limited company may adopt in its constitution such additional powers or restrictions as the company may require, so long as these provisions do not conflict with the main body of law in the Bill. This Part permits the new limited company to have a single director. It also allows such a company to dispense with holding an AGM, where agreed unanimously by the members. Provision is made for unanimous written resolutions, thus allowing a company to pass resolutions, including special resolutions, in writing. This Part also sets out the new summary approval procedure which deals with restricted activities such as the giving of financial assistance for the acquisition of shares, making reductions in company capital, varying company capital and giving loans to directors and connected persons.

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