What are Shareholders, Shares and Share Capital?

Shareholders

The shareholders are the owners of the company and they hold the Issued shares. There needs to be a minimum of one shareholder with a maximum of 149 for private limited companies. For a single member company, i.e. a private limited company with only one shareholder, the shareholder and Director can be the same person. Shareholders can be from anywhere in the world with corporate bodies allowed to act as shareholders. When setting up a company, the shareholders will sign the Constitution of the company and the signing of Constitution needs to be witnessed.

Authorised Share Capital

The Authorised Share Capital is the maximum amount of share capital a Directors are authorised to issue to a company's shareholders under the Constitution of the company. We recommend an Authorised Share Capital of 100,000 shares at €1 each for most companies. When registering a company through Incorporate Ireland, we will automatically set the Authorised Share Capital at this recommended amount.
The Authorised Share Capital is shown on a Limited company's Constitution at point 4:

"4. The share capital of the company is EUR 100000 divided into 100000 shares of EUR 1.00 each."

Changes to Authorised Share Capital after company has been incorporated requires updating the Constitution and notifying the CRO, so it is advised to keep the number of shares quite high.

Issued Share Capital

This is the number of shares that have actually been allotted to the shareholders of the company. Most companies would issue 100 shares and divide them between the shareholders as desired. One person or company can hold all the shares.
Given an Authorised Share Capital of 100,000 shares and an Issued Share Capital of 100 shares, the Directors can at any time in the future issue another 99,900 shares to any person. It is important that the Directors follow Company Law when issuing shares.
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