A genuine, EEA-wide director-residency requirement
Ireland's Companies Act 2014, Section 137 requires at least one director of every Irish company to be
resident in a European Economic Area member state -- not necessarily Ireland itself, but somewhere within
the EEA. This is a confirmed, statutory requirement, distinct from Fiji's stricter Fiji-specific residency
mandate and from the Netherlands' and Kenya's absence of any legal director-residency requirement.
Appointing an alternate director who is EEA-resident does not satisfy this obligation -- it must be an
actual director.
Two documented alternatives for a company without an EEA-resident director
A company without an EEA-resident director has two established alternatives. First, a Section 137 bond:
a EUR 25,000 bond, valid for a minimum of two years, issued by an approved bank, building society,
insurance company, or credit institution, covering potential Companies Act and tax-related fines and
penalties. Second, a Section 140 certificate: available where the company can show a “real and
continuous link” with one or more economic activities actually conducted in Ireland, which exempts it
from the EEA-director requirement without needing a bond. An NRI founder incorporating in Ireland without an
EEA-resident co-director should budget for one of these two routes.
Incorporating an Indian company as an NRI founder based in Ireland
An NRI in Ireland setting up an Indian private limited company follows the same Companies Act, 2013
framework as a founder based anywhere else -- including the requirement that at least one director be a
person who has stayed in India for a specified minimum number of days in the preceding calendar year. This
resident-director requirement is commonly satisfied by bringing in an India-based co-director or
professional nominee. Foreign investment into an Indian company by an NRI or an Ireland-incorporated entity
must separately comply with FEMA's FDI reporting requirements, generally through the RBI's online reporting
portal, within the prescribed timelines after each equity issuance or transfer, with profits repatriable
subject to the India-Ireland DTAA's dividend article.
Common mistakes NRI founders and investors in Ireland make:
- Assuming any Irish resident satisfies the EEA-director requirement, or conversely assuming only an
Irish resident does -- the requirement is EEA-wide, broader than Ireland alone.
- Appointing an EEA-resident alternate director instead of an actual director, which does not satisfy
Section 137.
- Not appointing a resident director for an Indian company back home, causing compliance issues under
India's Companies Act, 2013.
- Missing FEMA's FDI reporting deadlines after an equity issuance or transfer.
