EEA Resident Director Requirements
Understanding Section 137 of the Companies Act 2014 and how to incorporate if you lack a resident director.
The Statutory Requirement
Under Section 137 of the Companies Act 2014, every Irish registered company must have at least one director who is resident in a European Economic Area (EEA) state. The EEA comprises the 27 EU member states plus Iceland, Liechtenstein, and Norway.
Note: Following Brexit, the UK is no longer an EEA state. A UK-resident director does not satisfy this requirement.
Alternatives for Non-EEA Founders
If the proposed company cannot appoint an EEA-resident director, it must choose one of the following two alternatives:
1. The Section 137 Non-Resident Director Bond
The most common solution for foreign founders is to put in place a Section 137 Bond. This is an insurance policy that provides a surety of €25,000 to the Irish state in the event the company fails to pay certain fines or penalties.
- Validity: The bond must be valid for a continuous period of two years.
- Cost: Typically costs between €1,000 and €1,500 for the two-year premium, arranged via corporate service providers or insurance brokers.
- Process: The bond must be secured before the company is incorporated, as the bond details must be submitted with the Form A1.
2. Certificate of Real and Continuous Link
Alternatively, if the company can prove it has a "real and continuous link with one or more economic activities that are being carried on in the State," it can apply to the Revenue Commissioners for a certificate granting an exemption from the EEA director requirement.
This is rarely used at the point of incorporation because a new company usually cannot demonstrate this link until it has been trading, employing staff, and generating revenue in Ireland for some time.
Nominee Directors
Some corporate service providers offer "Nominee EEA Director" services for a recurring annual fee. While legal, founders should be cautious. Under Irish law, a director has strict fiduciary duties and cannot simply be a "rubber stamp." They carry personal liability for company offenses, meaning professional nominees often require strict oversight of company operations and bank accounts.