Central Bank and Financial Services Authority of Ireland Act 2004

• Permanent Page URL

Interpretation (Part IV).

24.—(1) In this Part—

‘affiliate’, in relation to an auditor, means a firm or body corporate specified by subsection (2) as being an affiliate of the auditor;

‘company’ has the same meaning as in section 2 (1) of the Companies Act 1963 ;

‘firm’ has the same meaning as in section 4 of the Partnership Act 1890 ;

‘guideline’ means a guideline issued under section 27A or, if such a guideline is amended, means the guideline as amended;

‘public authority’ means a body (whether corporate or incorporate) established or constituted by or under an Act that performs one or more public functions;

‘relevant obligations’, in relation to a regulated financial service provider, means the service provider's obligations under—

(a) all designated enactments and all designated statutory instruments that apply to it, and

(b) all codes, guidelines and notices issued by the Bank that apply to it, and

(c) all other enactments and statutory instruments with which it must comply;

‘work’, in relation to an auditor, includes all work of an accounting, financial or advisory nature that an auditor does for a financial service provider as well as work involved in auditing the financial service provider's accounts.

(2) For the purposes of this Part, each of the following is an affiliate of an auditor in a financial year:

(a) in the case of an auditor that is a firm—

(i) any other firm that, at any time during the financial year, was under the same ownership and control as the auditor,

(ii) any body corporate in which the auditor, any firm mentioned in subparagraph (i) or (iv) or any body corporate mentioned in subparagraph (iii) or (iv) was, at any time in the financial year, entitled to exercise or control the exercise of 20 per cent or more of the voting rights at a general meeting,

(iii) any body corporate that was, at any time in the financial year, in the same group as a body corporate mentioned in subparagraph (ii),

(iv) any other firm, or body corporate, that because of the use of a common name or corporate identity or the sharing of common professional services could reasonably be considered to be associated with the auditor,

(b) in the case of an auditor who is a natural person—

(i) any partnership in which the auditor was, at any time in the financial year, a partner,

(ii) any body corporate in which the auditor, any partnership mentioned in subparagraph (i) or any body corporate mentioned in subparagraph (iii) was, at any time in the financial year, entitled to exercise or control the exercise of 20 per cent or more of the voting rights at a general meeting,

(iii) any body corporate that was, at any time in the financial year, in the same group as a body corporate mentioned in subparagraph (ii).

(3) For the purposes of this Part, a director of a regulated financial service provider that is a body corporate is taken to be concerned in the management of the financial service provider even though the director is not involved in its day to day management.

Obligation of regulated service provider to provide compliance statement when required to do so by the Bank.

25.—(1) The Bank may, whenever it considers appropriate, serve on a regulated financial service provider a notice requiring the service provider to comply with this section.

(2) The Bank may also serve such a notice at the request of another public authority only if it is of the opinion that it would be in the public interest to do so.

(3) A notice must specify a reasonable period within which the requirement is to be complied with and, if the notice is served at the request of another public authority, it must specify the name and address of that authority.

(4) A regulated financial service provider on whom a notice is served shall provide the Bank with a compliance statement within the required period.

(5) If the compliance statement is provided at the request of another public authority, the financial service provider concerned shall, also within the required period, provide the public authority with a copy of the statement.

(6) A compliance statement must, in accordance with any relevant guideline, specify whether the regulated financial service provider concerned has, during the compliance period specified in the notice, complied with its relevant obligations, or with such of them as are specified in the notice.

(7) A compliance statement must also comply with the guidelines (if any) from time to time issued under section 27A (1).

(7A) In the case of a regulated financial service provider that is a company to which section 205E of the Companies Act 1990 applies, the Bank may, instead of serving on the financial service provider a notice under this section, rely on a compliance statement prepared under that section if it is satisfied that the statement contains the information that would be required to be included in a compliance statement under this section.

(8) In this section—

‘notice’ means a notice in writing served under this section;

‘required period’, in relation to a notice served on a regulated financial service provider, means the period specified in the notice within which the service provider must comply with the notice or, if the Bank extends that period, that extended period.

Compliance statement to be accompanied by auditor's report if required.

26.—(1) If a notice served under section 25 so requires, the financial service provider concerned shall request that service provider's auditor to prepare a report about the relevant compliance statement.

(2) Within such period as is specified in the notice, the auditor shall prepare a report about the relevant compliance statement and deliver the report to the financial service provider concerned.

(3) Such a report must—

(a) state whether the relevant compliance statement is, in the auditor's opinion, fair and reasonable in the light of the information obtained by the auditor, or by an affiliate of the auditor, in the course of undertaking work for the service provider, and

(b) if the auditor is of the opinion that the compliance statement is not fair and reasonable, specify the reasons why, in the auditor's opinion, that statement is not fair and reasonable.

(4) As soon as practicable after receiving a report prepared in accordance with this section, the financial service provider concerned shall—

(a) attach the report to the compliance statement, or

(b) if that statement has already been delivered to the Bank, deliver the report to the Bank, and if another public authority requested the compliance statement, also deliver a copy of the report to the public authority.

(5) If a report prepared in accordance with this section relates to a financial service provider that is a company, the auditor shall include a copy of the report in the auditor's report on the company's accounts that are required to be laid before the company in general meeting.

Offences under section 25 or 26.

27.—(1) A regulated financial service provider who fails to comply with a requirement of section 25 or 26 commits an offence and is—

(a) if tried summarily, liable on conviction to a fine not exceeding €2,000, or

(b) if tried on indictment, liable on conviction to a fine not exceeding €75,000.

(2) A regulated financial service provider who, having been convicted of an offence of failing to comply with a requirement of section 25 or 26, continues to fail to comply with the requirement commits a further offence on each day or part of a day during which the failure continues after that conviction and—

(a) if tried summarily, is liable on conviction to a fine not exceeding €200 for each such day or part of a day, or

(b) if tried on indictment, is liable on conviction to a fine not exceeding €7,500 for each such day or part of a day.

(3) If a regulated financial service provider that is a body corporate commits an offence under subsection (1) or (2), each person who, at the time when the offence is found to have been committed, was concerned in the management of the body commits a separate offence, unless the person establishes that—

(a) the body committed the offence without the person's knowledge, or

(b) although the person did have that knowledge, the person took all reasonably practicable steps to prevent the commission of the offence.

(4) A person may be charged with having committed an offence under subsection (3) even if the financial service provider concerned is not charged with having committed an offence under subsection (1) in relation to the same matter.

(5) A person who is convicted of an offence under subsection (3) is liable to a fine not exceeding that prescribed by subsection (1) or (2) for a regulated financial service provider.

Bank may issue guidelines.

27A.—(1) The Bank may from time to time issue guidelines with which a compliance statement must comply.

(2) The Bank may also from time to time issue guidelines specifying the manner in which the persons concerned in the management of regulated financial service providers, or of regulated financial service providers of a specified class, are required to exercise control over those service providers so as to ensure that those service providers comply with their obligations under the designated enactments and designated statutory instruments that apply to them.

(3) Whenever the Bank issues guidelines under this section, or amends or revokes those guidelines, the Bank must publish in Iris Oifigiúil a notice—

(a) stating that the guidelines have been issued, or have been amended or revoked, and

(b) specifying a place or places where copies of the guidelines, or the amendment or revocation, may be obtained.

(4) The Bank shall publish guidelines issued under this section, or any amendment or revocation of those guidelines, in a publication chosen by the Bank.

(5) Guidelines issued under this section take effect on the date on which the notice of their issue is published in Iris Oifigiúil or on such later date as is specified in the publication.

(6) The Bank may amend or revoke guidelines issued under this section.

(7) An amendment or revocation of a guideline issued under this section takes effect on the date on which notice of the amendment or revocation is published in Iris Oifigiúil or on such later date as is specified in the notice.

(8) All courts and tribunals are required to take judicial notice of guidelines in force under this section.

Auditor of regulated financial service provider to lodge annual report with Bank.

27B.—(1) This section applies to an auditor who is required by or in accordance with a prescribed enactment to report a matter to the Bank.

(2) Within 1 month after the date of the auditor's report on the financial service provider's accounts, or within such extended period as the Bank allows, the auditor of the service provider shall deliver a written report to the Bank—

(a) stating whether or not circumstances have arisen that require the auditor to report a matter to the Bank under a prescribed enactment and, if such circumstances have arisen, specify those circumstances, and

(b) where the service provider has, during that financial year, been required to provide the Bank with a compliance statement stating whether or not the requirement has been complied with.

(3) A report under this section must be in a form publicly notified by the Bank.

(4) The following are prescribed enactments for the purpose of this section:

(a) section 35 of the Insurance Act 1989 ;

(b) section 47 of the Central Bank Act 1989 ;

(c) section 89 of the Building Societies Act 1989 ;

(d) section 38 of the Trustee Savings Banks Act 1989 ;

(e) section 258 of the Companies Act 1990 ;

(f) section 15 of the Unit Trusts Act 1990 ;

(g) section 16 of the Investment Limited Partnerships Act 1994 ;

(h) section 33 of the Investment Intermediaries Act 1995 ;

(i) section 34 of the Stock Exchange Act 1995 ;

(j) section 122 of the Credit Union Act 1997 ;

(k) regulations 7, 8 and 9 of the Supervision of Credit Institutions, Stock Exchange Member Firms and Investment Business Firms Regulations 1996;

(l) regulation 85 of the European Communities (Undertakings for Collective Investment in Transferable Securities) Regulations 2003;

(m) any other provision of an Act or regulations declared under subsection (5) to be a prescribed enactment for the purpose of this section.

(5) The Bank may, by notice published in Iris Oifigiúil, declare a provision of an Act or regulations to be a prescribed enactment for the purpose of this section.

Duty of auditor to provide Bank with copies of certain reports.

27C.—(1) If the auditor of a regulated financial service provider provides the financial service provider, or those concerned in its management, with a report on a matter that has come to the auditor's notice while auditing the accounts of the financial service provider or carrying out any other work for the financial service provider of a kind specified by the Bank, the auditor shall provide the Bank with a copy of the report. The copy must be provided at the same time as, or as soon as practicable after, the original is provided to the financial service provider or those concerned in its management.

(2) If—

(a) an auditor of a regulated financial service provider invites the financial service provider, or the persons concerned in its management, to comment on a draft of a report referred to in subsection (1), and

(b) the financial service provider or those persons comment on the draft in response to the invitation,

the obligation of the auditor under that subsection applies only to the final version of the report.

(3) If, in relation to the financial year of a regulated financial service provider, there has been no reason for the auditor of the service provider to provide such a report, the auditor shall nevertheless notify the Bank in writing that this is the case.

Duty of auditor to provide Bank with copies of reports sent to Director of Corporate Enforcement.

27D.—Whenever an auditor of a regulated financial service provider that is a company provides the Director of Corporate Enforcement with a report or other document in accordance with a requirement imposed by the Companies Acts or any other enactment, the auditor shall also provide the Bank with a copy of that report or document. The copy must be provided at the same time as, or as soon as practicable after, the original is provided to the Director of Corporate Enforcement.

Bank may request auditor of regulated financial service provider to provide Bank with report on certain matters.

27E.—(1) The Bank may, by notice in writing, request an auditor of a regulated financial service provider, or an affiliate of the auditor, to provide the Bank with a report on all or any of the following:

(a) the service provider's accounting or other records;

(b) the systems (if any) that the service provider has in place to ensure that the service provider acts prudently in the interests of its members (if a company or firm) and the interests of those to whom the service provider provides financial services;

(c) any other matter in respect of which the Bank requires information about the service provider, or the service provider's activities, to enable the Bank to perform a function imposed on it by or under an Act.

(2) The auditor or affiliate shall comply with such a request within such period as is specified in the request, or within such extended period as the Bank may allow.

(3) If the Bank so directs, the auditor or affiliate shall not, without the consent of the Bank, disclose to the financial service provider concerned, or any person concerned in the management of, or employed by, that service provider—

(a) the fact that the auditor or affiliate has received a request under subsection (1), or

(b) any information that might lead that service provider, or any such person, to suspect that the auditor or affiliate has received such a request.

Bank may require auditor of regulated financial service provider to provide certain documents.

27F.—(1) The Bank may, by notice in writing, require an auditor of a regulated financial service provider, or an affiliate of the auditor, to provide the Bank with a copy of any record or information provided or obtained by the auditor or affiliate in connection with an audit of the financial service provider's accounts that is in the possession of the auditor or affiliate.

(2) The auditor or affiliate shall comply with such a request within such period as is specified in the request, or within such extended period as the Bank may allow.

(3) If the Bank so directs, the auditor or affiliate shall not, without the consent of the Bank, disclose to the financial service provider concerned, or any person concerned in the management of, or employed by, that service provider—

(a) the fact that the auditor or affiliate has received a request under subsection (1), or

(b) any information that might lead that service provider, or any such person, to suspect that the auditor or affiliate has received such a request.

Offences by auditors and affiliates under this Chapter.

27G.—(1) An auditor of a regulated financial service provider who, without reasonable excuse, fails to comply with section 27B(2), 27C(1), 27D, 27E(2) or 27F(2), or contravenes section 27E(3) or 27F(3), commits an offence and—

(a) if tried summarily, is liable on conviction to a fine not exceeding €2,000, or

(b) if tried on indictment, is liable on conviction to a fine not exceeding €75,000.

(2) An affiliate of an auditor of a regulated financial service provider who, without reasonable excuse, fails to comply with section 27E(2) or 27F(2), or contravenes section 27E(3) or 27F(3), commits an offence and—

(a) if tried summarily, is liable on conviction to a fine not exceeding €2,000, or

(b) if tried on indictment, is liable on conviction to a fine not exceeding €75,000.

(3) An auditor who, having been convicted of an offence of failing to comply with a provision of section 27B, 27C, 27D, 27E or 27F, continues to fail to comply with the provision commits a further offence on each day or part of a day during which the failure continues after that conviction and—

(a) if tried summarily, is liable on conviction to a fine not exceeding €200 for each such day or part of a day, or

(b) if tried on indictment, is liable on conviction to a fine not exceeding €7,500 for each such day or part of a day.

(4) An affiliate of an auditor who, having been convicted of an offence of failing to comply with a provision of section 27E or 27F, continues to fail to comply with the provision commits a further offence on each day or part of a day during which the failure continues after that conviction and—

(a) if tried summarily, is liable on conviction to a fine not exceeding €200 for each such day or part of a day, or

(b) if tried on indictment, is liable on conviction to a fine not exceeding €7,500 for each such day or part of a day.

Auditors to have certain immunities from liability.

27H.—An auditor or an affiliate of a regulated financial service provider does not—

(a) contravene any duty of confidentiality owed to the service provider or to its creditors or clients or, if the service provider is an incorporated or unincorporated body, to its members, or

(b) incur any tortious liability,

only because the auditor or affiliate complies with a duty imposed on the auditor or affiliate by this Part.

Offence to provide false or misleading information for the purposes of this Part.

27I.—Any person who, in a return, statement or other document required by or under a provision of this Part or a regulation made for the purposes of this Part, provides information that the person knows, or ought reasonably to know, is false or misleading in a material respect commits an offence and is—

(a) if tried summarily, liable on conviction to a fine not exceeding €2,000 and to imprisonment for a term not exceeding 3 months, or both, or

(b) if tried on indictment, liable on conviction to a fine not exceeding €75,000 or to imprisonment for a term not exceeding 12 months, or both.

Who may prosecute offences against this Part that are to be tried summarily.

27J.—Proceedings for an offence against a provision of this Part that is to be tried summarily may be brought and prosecuted only by the Bank or the Director of Public Prosecutions.

Limitation period for bringing proceedings for summary trial of offence against this Part.

27K.—Proceedings for an offence against a provision of this Part that is to be tried summarily may be brought at any time within 2 years after the date on which the offence is alleged to have been committed or, if the commission of the offence is discovered after the end of that period, within 2 years after the discovery of the commission of the offence. This section has effect despite section 10 (4) of the Petty Sessions (Ireland) Act 1851 .”.