Non-Resident Directors in Irish Companies: Full Guide
Non-residents can direct Irish companies, but you need one EEA director or a Section 137 bond (€1,600). Learn both options and stay compliant.
Who should read this
This article is for non-EEA founders and directors setting up or running an Irish company.
If you're wondering whether you can be a director without living in Europe, or what this "Section 137 bond" requirement actually means, this guide explains the EEA residency rule, how the bond works as an alternative, and what happens if you're non-compliant.
Key takeaways
- Irish companies must have at least one EEA-resident director or obtain a Section 137 bond to comply with law.
- A Section 137 bond costs €1,600 for two years and must be renewed to maintain compliance.
- Without an EEA director or bond, your company faces fines up to €5,000 and cannot maintain good standing.
- EEA residency requires physically living in the EEA for 183+ days per year, not just citizenship.
- Most non-EEA founders choose Section 137 bonds over nominee directors for simplicity and to avoid third-party liability.
Can Non-Residents Be Directors of Irish Companies?
Can Non-Residents Be Directors?
Yes, non-residents can be directors of Irish companies.
But there's a catch - every Irish company must have at least one director who is resident in the EEA.
EEA means European Economic Area (EU countries plus Iceland, Liechtenstein, and Norway).
If you don't have an EEA-resident director, you need a Section 137 bond.
What Is the EEA Residency Requirement?
Irish law requires at least one director to be resident in an EEA state.
This director must actually live in the EEA, not just hold citizenship.
The requirement exists so Irish authorities can contact a director if needed.
It ensures someone locally responsible is connected to the company.
What Counts as EEA Resident?
You're EEA resident if you spend more than 183 days per year in an EEA country.
Irish citizens living abroad are not automatically EEA resident for this purpose.
UK citizens are not EEA resident after Brexit (UK left the EEA).
Physical residence matters, not just passport or citizenship.
What If You Don't Have an EEA-Resident Director?
You have two options if nobody on your team is EEA resident.
Get a Section 137 bond from an approved insurer (Open Forest can get this for you).
Or appoint an EEA-resident director to your board.
Most non-EEA founders choose the bond option.
What Is a Section 137 Bond?
A Section 137 bond is an insurance policy that covers potential company liabilities.
It costs approximately €1,600 for a two-year term.
The bond provides €25,000 coverage for certain company obligations.
It satisfies the legal requirement for EEA residency.
How Does a Section 137 Bond Work?
You buy the bond from an approved Irish insurance provider.
The bond certificate is filed with the Companies Registration Office.
This exempts your company from the EEA director requirement.
You must renew the bond every two years.
If the bond lapses, your company is non-compliant.
What Does the Bond Actually Cover?
The bond covers specific obligations under the Companies Act.
It pays fines and penalties if your company fails to meet certain filing deadlines.
It covers costs if you don't deliver documents to the CRO when required.
It does not cover general business debts or liabilities.
The coverage is narrow and specific to compliance matters.
How Much Does a Section 137 Bond Cost?
The cost with Open Forest is €1,600 for two years (note - it is paid to an insurance company!).
Most providers charge a lot more.
You must renew every two years at the same cost.
This is an ongoing expense for non-EEA companies.
Compare this to appointing an EEA-resident director, which has no direct cost.
Alternatives to Section 137 Bonds
Instead of buying a bond, you can appoint an EEA-resident director.
This person becomes a real director with full legal responsibilities.
They must be qualified to act as director (over 18, not disqualified).
They have the same duties and liabilities as any other director.
Can You Appoint a Nominee Director?
Yes, you can appoint a nominee EEA-resident director.
This person serves on the board to satisfy the residency requirement.
They typically have limited involvement in day-to-day operations.
But they have full legal duties and potential liability.
Nominee directors must understand they're legally responsible for company actions.
Never appoint someone who doesn't understand director responsibilities.
Nominee Directors vs Section 137 Bonds
Nominee directors can be cheaper than bonds over time.
But they carry legal responsibilities and potential liability.
They must sign off on certain company documents and decisions.
Finding a trustworthy nominee director can be difficult.
Section 137 bonds cost more but involve no third-party liability issues.
Most international founders prefer bonds for simplicity.
What Happens If You Have No EEA Director and No Bond?
Your company is non-compliant with Irish company law.
The company faces fines of up to €5,000.
Directors can be fined up to €5,000 individually.
The CRO may refuse to register certain documents.
You cannot maintain good standing without compliance.
Investors and banks will not work with non-compliant companies.
Can You Switch Between Bond and EEA Director?
Yes, you can switch at any time.
If you hire an EEA-resident director, you can let your bond lapse.
If your EEA director leaves, you must get a bond before they resign.
Never have a period without either a bond or EEA director.
Do All Directors Need to Be EEA Resident?
No, only one director needs to be EEA resident (or you need a bond).
All other directors can be from anywhere in the world.
You could have five directors with four in the US and one in Ireland.
Or five non-EEA directors with a Section 137 bond.
EEA Residency and Tax
Director residency is separate from tax residency.
Having an Irish-resident director doesn't automatically make the company Irish tax resident.
Tax residency depends on where the company is managed and controlled.
But having an Irish director can be a factor in determining tax residency.
Get tax advice if you have concerns about where your company is tax resident.
Proving EEA Residency
The CRO may ask for proof that your director is EEA resident.
Acceptable proof includes utility bills, rental agreements, or tax documents.
The proof must show actual residence, not just citizenship.
Keep this documentation ready in case the CRO requests it.
Section 137 Bonds and Company Changes
You don't need a new bond when directors change.
The bond stays with the company, not specific directors.
You only need to renew every two years regardless of director changes.
But if you appoint an EEA-resident director, you can cancel the bond.
Getting a Section 137 Bond
Several Irish insurance providers offer Section 137 bonds.
The application process is straightforward and quick.
You typically receive the bond certificate within 3-5 days.
The bond must be filed with the CRO as part of company formation.
Or filed separately if adding it to an existing company.
The Practical Reality
Most non-EEA founders use Section 137 bonds.
It's simpler than finding and appointing a trustworthy nominee director.
The cost (€1,600 for two years) is manageable.
It provides certainty without depending on third parties.
As your company grows and hires in Ireland, you may eventually have an EEA director naturally.
At that point, you can let the bond lapse.
Until then, the bond is the practical solution for international founders.
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Frequently asked questions
Here's everything you need to know to get started, manage your account, and troubleshoot the most frequent issues.
Yes, non-residents can be directors of Irish companies. However, every Irish company must have at least one director who is resident in the EEA, or you must obtain a Section 137 bond to satisfy this legal requirement.
You're considered EEA resident if you spend more than 183 days per year in an EEA country (EU countries plus Iceland, Liechtenstein, and Norway). Physical residence matters, not just passport or citizenship - so Irish citizens living abroad or UK citizens after Brexit don't automatically qualify.
A Section 137 bond is an insurance policy that exempts your company from the EEA director requirement by providing €25,000 coverage for certain company obligations. It costs approximately €1,600 for a two-year term and must be renewed every two years to maintain compliance.
Yes, you can appoint an EEA-resident nominee director to satisfy the residency requirement. However, they have full legal duties and potential liability as a real director, even if they have limited involvement in day-to-day operations, so they must understand their responsibilities.
Your company becomes non-compliant with Irish law and faces fines of up to €5,000, while directors can be fined up to €5,000 individually. The CRO may refuse to register documents, and investors and banks will not work with non-compliant companies.
No, only one director needs to be EEA resident, or you need a Section 137 bond. All other directors can be from anywhere in the world - you could have five directors with four in the US and one in Ireland, or five non-EEA directors with a bond.
Yes, you can switch at any time between the two options. If you hire an EEA-resident director, you can let your bond lapse, but if your EEA director leaves, you must get a bond before they resign to avoid any period of non-compliance.
No, director residency is separate from tax residency. Tax residency depends on where the company is managed and controlled, though having an Irish director can be one factor in determining tax residency, so get tax advice if you have concerns.
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