Limited company/Army

westwicklow

Would anyone on here be in a position to clarify a point in general.

Is it ok and acceptable for a serving member of the Irish Army to become a shareholder or director in an Irish private limited company?

Some of the eh, older and wiser people locally, seem to think that this situation is not correct but we are not sure.

GerardKeating

westwicklow wrote: »

Would anyone on here be in a position to clarify a point in general.

Is it ok and acceptable for a serving member of the Irish Army to become a shareholder or director in an Irish private limited company?

Some of the eh, older and wiser people locally, seem to think that this situation is not correct but we are not sure.

There is nothing in law against this, but the Army could raise an issue in disciplinary grounds if they saw some conflict.

Jo King

There is no bar to it in Company law. The difficulty arises in relation to Section 168 of the Defence Act 1954. This prohibits conduct to prejudice of good order and military discipline. This section regulates, among other things, relations between members of the Defence Force. Relations includes social, sexual and financial relations. If the private company is being run by members of the Defence Forces of different ranks there would certainly be issues arising. If a member of the Defence Forces makes an investment in a business unconnected with other members of the Defence Forces and does not spend an inordinate amount of time involved with the business, there is unlikely to be an issue.
The main concer of the military authorities is that individuals do not become business partners with each other, particularly where they are of different ranks. The danger is that there would be at least a perception of favouritism which would damage morale. Also, a member becoming involved in outside business activities might lose interest in the primary job

westwicklow

Very good replies, thanks.

westwicklow

To develop this more, let me ask a "what if question...."

What if the member of the Army became a director in a local private limited company which may have strong commercial links (via customer base) to the soldier's area of operation as well as, for example, his/her hometown?

Jo King

The main issue here would be if there was any connection between the member's official position and the commercial activity. If the member was the director of a company supplying goods or services to the Defence Forces there would be issues arising.

westwicklow

Thanks Jo King.

To tease this out some more, what if the private limited company, of which the member of the Army had become a director, got into trading difficulties and fell into local disrepute. How might this scenario reflect on the military?

Our man in Havana

Very poorly as it could possibly bring the army into disrepute.

Jo King

If the company got into difficulty there would be two problems for the individual.
If the director was made personally liable for the debts and could not pay them there would be trouble. Undischarged judgments could be grounds for disciplinary action.

trad

Isn't there a case recently of a member of the Air Corps whose property developement company went under owing millions, saw something about it on the news, or it could have been in the Phoenix.

westwicklow

Just for the public record, I'm not referring to a specific case in my OP.