• One owner
• Unincorporated
• Personal income tax on profits
• Unlimited liability

Often referred to as a sole trader, a sole proprietorship is an unincorporated business with just one owner who pays personal income tax on profits earned. Any debts or losses incurred cannot be shared with other individuals. It is the cheapest and easiest business structure to establish, with the individual legally responsible for all aspects of the business.

Simplest and most cost-effective structure, but comes with full personal liability for business debts.

• Two or more owners
• Shared responsibilities and liabilities
• Unlimited liability

A general partnership is a business arrangement whereby two or more individuals agree to share responsibilities, assets, profits, financial and legal liabilities of a jointly owned business, granting unlimited liability.

Allows for shared management and resources, but all partners are fully liable for business debts.

• Owned by small number of shareholders
• Limited liability for owners
• Private sale of shares

A Private Limited Company is owned by an NGO (non-government organisation) or a relatively small number of shareholders, and the sale of company shares is handled privately. An individual/owner is only responsible for the business's financial liabilities to the extent that they invested in the company.

Offers limited liability protection while maintaining privacy and control over ownership.

• Ownership open to public
• Shares traded publicly
• Limited liability for shareholders

A public company is a corporation whose ownership is open to the public. Anyone can buy shares in the company's stocks. A limited company is a corporation in which an individual's financial liability for the company is restricted to the capital investment.

Allows for raising capital from the public while providing limited liability to shareholders.

• Companies Registration Office (CRO)

Corporate information is available at the Companies Registration Office: www.cro.ie.

Use the CRO website as the primary source for official company information in Ireland.

• Companies Registration Office
• Private reporting agencies

You can obtain information on the financial state of affairs for companies and industry at the Companies Registration Office. There are also numerous private reporting agencies offering credit checks.

Combine official CRO data with reports from private agencies for comprehensive financial information.

• Credit reports
• Online services

Normally you find this information in a credit report. Credit reports are offered as a service online.

Utilize online credit report services to check for existing judgments against businesses.

• Credit application or signed contracts
• Statement of account
• Invoices or credit notes
• Proof of delivery dockets
• Guarantee
• Demand letters
• Correspondence related to disputes

You will require the following documents:

• The credit application form or signed contracts
• An up-to-date statement of account showing how the balance due is computed
• The invoices or credit notes
• The proof of delivery dockets
• A guarantee
• The demand or call-up letters
• The full disclosure or copies of any correspondence between the parties prior to referral, pertaining to any possible contentious issues or disputes that may or have arisen

If the court doesn't receive the above documentation, it can't issue proceedings on your behalf. This may in turn render the case statute-barred and prevent future litigation.

Maintain comprehensive documentation for all business transactions to ensure legal enforceability.

• Seller retains ownership until conditions are met
• Two types: Simple and All Monies

When included in trade contracts, retention of title allows the seller to retain ownership over the goods supplied until certain contractually defined conditions are met, therefore providing the seller with a form of security against the buyer's default or insolvency.

There are two types of retention of title (ROT) clauses:

• Simple: Title to the goods only passes to the buyer in respect of payment for each invoice relating to the goods.
• All Monies: Title to the goods only passes to the buyer when they have paid for all the goods supplied.

Consider including retention of title clauses in contracts for additional protection against buyer default or insolvency.

• Mandatory warning notice
• Specific content requirements

A warning notice to the debtor is mandatory before filing any enforcement claims. The warning notice should include:

• Creditor name and overview of the claim
• The total amount of the claim, including penalties (interest)
• Payment method required
• A warning that the claim will be enforced through the enforcement authority in case the claim is not settled by the required date
• Information on how to dispute the claim

Always send a comprehensive warning notice before initiating legal proceedings.

The purpose of the regulations is to give legal effect to Directive 2011/7/EC of the European Parliament and of the Council of 16th February 2011 on combatting late payment in commercial transactions.

The regulations apply equally to public and private sectors.

Unless otherwise specified in agreed contracts, the interest rate will be the European Central Bank (ECB)'s main refinancing rate (as at 1st January and 1st July each year) plus 8%.

The ECB rates in force on 1st January and 1st July apply for the following six months in each year. Only one rate will apply to each late payment – that is the rate in force on the payment date.

The ECB rates can be checked on the Central Bank and Financial Services Authority of Ireland website: www.centralbank.ie.

As well as interest, you may charge an amount to compensate for the costs of collecting late payments. The amount of compensation that can be claimed is determined by the outstanding amounts as follows:

• Amount Owed up to EUR 999.99 - Compensation: EUR 40
• Amount Owed EUR 1,000-9,999.99 - Compensation: EUR 70
• Amount Owed over EUR 10,000 - Compensation: EUR 100

• Legal entitlement to interest
• ECB rate plus 8%
• Compensation for collection costs
• Based on EU Directive 2011/7/EC

• 6 years for debt claims

Creditors are granted a period of six years to chase debtors as is outlined in the Statute of Limitations 1957.

Act within the 6-year limitation period to preserve your right to legal action.

• Private and confidential manner of debt resolution with the aid of a third party.
• Entirely voluntary and not a legal requirement prior to court action.
• Becomes binding once parties agree in writing to a settlement.

• Both parties submit documentation and evidence to a neutral third party to propose a settlement.
• Governed by the Arbitration Act 2010.
• Voluntary process, only binding if both parties accept proposed settlements.

• Pre-legal actions: up to 14 days
• Litigation: approximately 12 weeks
• Enforcement: 6-12 months

Pre-legal actions such as a letter before action (LBA) may take up to 14 days.

Litigation action on standard cases takes roughly 12 weeks to obtain a judgment.

Sheriffs' coverage in Ireland is limited, and enforcement is often a very prolonged procedure that takes approximately six to twelve months.

Be prepared for potentially lengthy legal processes, especially during the enforcement stage.

• Varies based on debt value and case complexity
• Solicitor costs up to EUR 500 per hour
• Court typically allocates 75% of costs to unsuccessful debtor

Overall costs are subject to the outstanding debt value, case complexity, extrajudicial interest and the involvement of certain experts or witnesses. It is important to consider that the length of a court case also has a significant impact with solicitor costs charged at an hourly rate of up to EUR 500 per hour.

The judge is responsible for the allocation of court costs with roughly 75% of the costs being charged to the debtor when the debtor proves unsuccessful in their defence.

Consider potential costs when deciding to pursue legal action. Be prepared for high solicitor fees, but understand that a significant portion may be recoverable if successful.

The process of litigation in Ireland is very similar to that of the United Kingdom but is arguably slower and more costly.

In the case of an insured debt, for which the necessary steps have been taken and evidence provided, credit insurance will contribute towards legal costs. In the meantime, creditors would expect to be advised on the legal action; but if the claim has been paid, then the credit insurance will direct such action.

Understand the court hierarchy and follow pre-litigation steps carefully. Ensure affidavits are properly prepared and signed.

Be prepared for a potentially lengthy and costly process, especially if the case goes to higher courts.

If you have credit insurance, it may contribute to legal costs and guide the legal action.

There are three levels of courts depending on the value of the debt:

• District Court – up to EUR 15,000
• Circuit Court – up to EUR 75,000
• High Court – over EUR 75,000

Creditors must send two letters granting a deadline of seven days to settle outstanding debts before proceeding with legal action. In the case where there is no response, a solicitor will issue a Civil Bill or Claim Notice to the court for service on the debtor which may take up to eight weeks.

Once served on the debtor, the debtor has 21 days to return a Notice of Intention to Defend. Such an action indicates that the solicitor must obtain further defence details and the case will be referred to the master for a hearing. If there is no response, then an affidavit of debt is issued to you.

An affidavit is a compulsory document in Ireland which must be signed by an official of the creditor's company who has sufficient awareness of the debt and is able to detail the specific monetary value.

The affidavit is returned to the court by the solicitor, and a return date is set by the court, which could be up to three months from the submission of the affidavit. The solicitor then seeks judgment, and an enforcement procedure will begin once this is issued.

Pre-legal actions such as a letter before action (LBA) may take up to 14 days.

Litigation action on standard cases takes roughly 12 weeks to obtain a judgment.

Sheriffs' coverage in Ireland is limited, and enforcement is often a very prolonged procedure that takes approximately six to twelve months.

Overall costs are subject to the outstanding debt value, case complexity, extrajudicial interest and the involvement of certain experts or witnesses. It is important to consider that the length of a court case also has a significant impact with solicitor costs charged at an hourly rate of up to EUR 500 per hour.

The judge is responsible for the allocation of court costs with roughly 75% of the costs being charged to the unsuccessful debtor.

• Publication in Stubbs Gazette
• Enforcement officer or sheriff collection
• Asset seizure possible
• Judgment mortgage option

Judgements are published in the Stubbs Gazette for all to see, however, this does not guarantee full and immediate debt settlement by a debtor. In such cases, an enforcement officer or sheriff would be instructed by the creditor and the court to collect the funds directly from the debtor's premises.

If the debtor is not able to make any payments, then the sheriff may seize assets of the debtor for resale to settle open debts. It is also possible for creditors to obtain a judgement mortgage which means that any immoveable property belonging to the debtor cannot be sold without first discharging the debt.

Be aware of various enforcement options, including asset seizure and judgment mortgages. Publication in Stubbs Gazette may encourage settlement but doesn't guarantee it.

• Voluntary arrangement
• Administration
• Liquidation
• Examinership

There are a variety of insolvency types ranging from:

• Voluntary arrangement: whereby the majority of creditors agree to a fixed payout.
• Administration: where an administrator is appointed to try to trade out the debtor company.
• Liquidation: where all debtor assets are liquidated with the resulting cash distributed to all creditors as per the relevant quotas.
• Examinership: runs for 100 days under court protection. An insolvency administrator is appointed to review the failing debtor and issue proposals to be considered by creditors. Any proposals agreed upon by creditors must be approved by the court, with a formal report issued by the court and sent to all involved parties.

Understand the different insolvency procedures and their implications for creditors. Be particularly aware of the examinership process, which is unique to Ireland.

• 6-month registration deadline
• Process may last up to 5 years

Insolvency claims must be registered within six months of the insolvency announcement. The insolvency process itself may last up to five years subject to the case.

Act promptly to register claims within the 6-month deadline. Be prepared for potentially lengthy insolvency proceedings.