CRO Begins Issuing 10-Week Warning Letters Around Annual Returns

Cro Warning Letters

By Shannon Power, 1st August 2023 (Updated 24th January 2024)

As part of an enforcement drive, the Companies Registration Office (CRO) has begun issuing 10-Week Warning Letters to those companies who have not fulfilled their annual returns/compliance requirements, notifying them of the potential consequences of non-compliance. In this blog post, we will delve into the implications of these warning letters and highlight the measures businesses can take to protect their interests.

The 10-Week Warning Letter

As mentioned, the CRO is taking a firm stance on non-compliance by signalling its intention to enforce strict actions against companies that have failed to file annual returns and accounts. A notable development is the issuance of 10-week warning letters to companies that have fallen behind. Should the company not be brought into good standing within this timeframe, then the company will send a 12-week strike-off warning notice, informing the company it will be involuntarily struck off within 12 weeks should the outstanding annual returns not be filed.

Enforcement Measures

The consequences of not filing annual returns on time can be severe. The CRO and the Corporate Enforcement Authority (CEA) have the authority to take enforcement measures, which may include Involuntary Strike-off, Company and/or Director Prosecutions, or Section 797 (High Court) action against the company and its directors. The risk of Involuntary Strike-off can result in the loss of limited liability protection, leading to personal liability for the company’s debts. Additionally, any remaining assets may become the property of the Minister for Public Expenditure and Reform and Directors can be disqualified or restricted from acting as directors.

Proactive Approach to Compliance

The path to avoiding these enforcement actions is simple: ensure your annual returns are on time, and that your company and its directors keep compliant with its obligations under the Companies Act. The 10-week warning and 12-week strike-off warning periods provide companies with an opportunity to rectify any non-compliance issues before facing harsh consequences. Companies must diligently keep track of their filing deadlines and fulfil their obligations in a timely manner.

Maintaining accurate contact information with the CRO is vital to receiving critical notifications directly. Businesses are encouraged to keep their email addresses up to date in the CRO’s records to ensure they receive all relevant communications promptly.

Our Annual Returns Filing Services

To make compliance more manageable for businesses, we offer expert Annual Returns Filing Services. Our experienced team ensures that your company’s annual returns are accurately and promptly filed with the CRO, sparing you the risk of enforcement actions and penalties.

To further aid companies in staying compliant, our Annual Return Late Filing Fee Calculator helps determine the potential late filing fees associated with delayed submissions.

What Should I Do If I Receive a 10-Week Warning Letter from the CRO?

Receiving a 10-week warning letter from the Companies Registration Office (CRO) is a critical situation, particularly when a company has ceased trading during COVID-19. If you want to prevent the involuntary strike-off, you must act promptly.

If the directors want to keep the company live on the Register, options include:

  • Filing outstanding annual returns and financial statements, and paying late filing penalties.
  • Applying to the District Court for an extension of time to file annual returns.

If the company has ceased trading:

  1. Voluntary strike-off –

An Irish Company may be Voluntarily Struck off the Register if the assets and liabilities are worth no more than €150 or the balance sheet is zero. This is the easiest and fastest way to close an Irish Company.

Read more about what is required to voluntarily strike off your company here.

  1. Voluntary liquidation –

If the company is financially sound, it has the option to initiate a Members Voluntary Liquidation using the Summary Approval Procedure. On the other hand, if the company is facing insolvency, it is required to undergo either a Creditors Voluntary Liquidation or proceed with a Court Liquidation.

Read more about the different types of Voluntary Liquidations here.

Involuntary strike-off poses risks, including the vesting of company assets in the state, personal liability for continuing to trade while struck off, potential prosecution by the Corporate Enforcement Authority, and Revenue proceedings for unpaid taxes. Directors must be aware of their duty to act in the company’s best interests to avoid disqualification, fines, and other legal consequences. It’s crucial to dissolve the company appropriately to mitigate these risks and comply with the Companies Act 2014.

Costs To Be Aware Of

Those who may/have received a 10-week warning letter from the CRO must be aware of the potential costs involved in getting your company back in good standing with the CRO.

To do so the costs may include the following:

  • File outstanding annual returns – €150 +VAT
  • File dormant accounts if not traded – €250 +VAT (un-audited)
  • File audited dormant accounts – €795 +VAT (this is required if they lose audited exemption – being late with annual return and must be filed for 2 years)
  • CRO penalty fee – €100 once late rising by €3 per day late to a maximum of €1,200 per year and max 3 years – €3,600 would be the most a company would have to pay.

If you meet all the requirements, another option is to submit a Section 343 District Court Application. This involves an Application fee of €950+VAT and outlays of €120+VAT.

If you have any further questions surrounding this update, the team at Company Bureau will be more than happy to help! Give us a call at +353(0)1 6461625 or fill out our online contact form.

Disclaimer This article is for guidance purposes only. It does not constitute legal or professional advice. No liability is accepted by Company Bureau for any action taken or not taken in reliance on the information set out in this article. Professional or legal advice should be obtained before taking or refraining from any action as a result of this article. Any and all information is subject to change.