What is Examinership:
Examinership is the mechanism whereby by a struggling and insolvent company is given the protection of the Court from its creditors to assist in its survival. Examinership is an alternative to winding up of a company that is in financial difficulties. If the Court is satisfied that the company has a genuine chance of survival, it can appoint an Examiner and the company will then be given a 100 days grace period to prepare a business plan and restructure its liabilities.
What has changed?
Under Section 2 of the Companies (Miscellaneous Provisions) Act 2013, an Examiner can now be appointed by the Circuit Court as opposed to the High Court. Companies can now apply to the Circuit Court for Examinership, as long as they satisfy at least two of the following three conditions:
- Their balance sheet does not exceed €4.4 million.
- Their Turnover does not exceed €8.8 million
- Their Employees must not exceed 50 in total.
What does this mean for small business?
Up until now an Examiner could only be appointed by the High Court. The costs associated with bringing such an application in the High Court excluded many viable companies from the process. Allowing the Circuit Court to appoint Examiners will reduce costs and make in more accessible to SMEs. It also means companies can have the process handled by their local Court as opposed to having to repeatedly attend the High Court in Dublin.
For further information on examinerships or indeed any aspect of company law, please do not hesitate to contact Hanahoe and Hanahoe solicitors on 045 897784 or at info@hanahoeandhanahoe.com.
This article is merely for information purposes only and is not and should not be taken as legal advice. If you have any queries in relation to this or any other company law matter, you should contact us. No solicitor/client relationship or duty of care or liability of any nature exists between you and Hanahoe and Hanahoe solicitors, until you receive written confirmation that we are acting as solicitors on your behalf.