Notification of directors’ and secretaries’ interests in shares/debentures

If you are a director or secretary of an Irish company (or a shadow director) you must, within FIVE DAYS of your appointment, notify the company, in writing, of the existence of any interest you have of any kind in securities (shares or debentures) of the company or another company within the same group and give particulars of the securities.  An interest of a spouse or minor child of a director/secretary is treated as an interest of that director or secretary.

If you are an existing director (shadow director) or secretary of a company you must notify the company, in writing, of any acquisition or disposal of any interest in the following situations within five days of its occurrence: 

  • If you (your spouse or minor child) acquired or disposed of an interest in the securities of the company or another company within the same group.
  • If you contract to buy or sell securities of the company or another company within the same group.
  • If another company within the same group  grants you a right to subscribe for securities or your exercising or disposing of such a right.
  • If you dispose of a right to subscribe for securities of the company.
  • If you are granted or exercise a right to subscribe for securities of the company to or by your spouse or minor child.
  • The delivery to, or to the order of, you of securities to the company or another company within the same group, or the failure of such a delivery to occur in satisfaction of a contract or right, or the lapse of a right to call for such delivery.

It is the responsibility of the person acquiring or disposing of an interest through a broker to ensure that the broker gives him the necessary information to make the required notification.

The notification itself is straightforward. It should include your name, address, a confirmation that you are complying with the requirements of Section 53 of the Companies Act 1990, the number/amount/class of securities involved and other relevant information in relation to your interests in other companies within the same group.

If you fail to make the notification correctly within the required time period, no right or interest of any kind in respect of the shares and debentures will be enforceable directly or indirectly, by action or legal proceedings.  In the case of an accidental omission, an application can be made to court. If it is not accidental, the securities may be valueless.  If a person is found to be in default they could be fined up to €12,700 and receive a prison sentence. 

In conclusion, each company must keep a register giving the information contained in all notifications received within three days in chronological order, stating the date of entry.

ORLA KEANE
June 2003