On 9 March 2023, the President of Ireland signed the Central Bank (Individual Accountability Framework) Bill 2022 (the "Bill") into law. See our previous update here for a detailed examination of the contents of the Bill.
On 13 March 2023, the Central Bank of Ireland (the "CBI") launched its much anticipated consultation paper (available here) on the Individual Accountability Framework (the "Consultation Paper"). The launch of the consultation process, which will run for three months until 13 June 2023, was accompanied by the publication of draft Senior Executive Accountability Regime (SEAR) Regulations (available here) (the "Draft Regulations") and draft guidance on the Individual Accountability Framework (available here) (the "Draft Guidance").
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As expected, the Draft Regulations propose to apply the SEAR aspect of the Individual Accountability Framework to credit institutions, certain insurance undertaking and certain investment firms at this stage.
The Minister for Finance, in a recent Oireachtas debate in relation to the Bill, has indicated that all sections of the Bill will be commenced as soon as possible. The Minister for Finance noted that the exceptions to this indicative timeline to commencement are sections 3 to 6 and section 10 of the Bill which deal with matters relating to the SEAR, conduct standards and certification, which will be commenced following the completion of the CBI's public consultation process.
In the CBI's press release accompanying the publication of the Consultation Paper, the Draft Regulations and the Draft Guidance provided some more information in terms of the timeline to implementation of the Individual Accountability Framework, noting the following proposed timeline:
We will now examine the Consultation Paper, Draft Regulations and Draft Guidance in detail and issue further updates in due course.
- Conduct Standards including accountability of senior individuals for running their parts of the business effectively to apply from 31 December 2023;
- Fitness & Probity Regime - Certification and inclusion of Holding Companies to apply from 31 December 2023; and
- Regulations prescribing responsibilities of different roles and requirements on firms to clearly set out allocation of those responsibilities and decision making to apply to in-scope firms from 1 July 2024.
The Walkers Individual Accountability Framework Team are ready to assist clients by:
If you have any concerns or queries regarding the impact that the introduction of the Bill and the Individual Accountability Framework may have on your business, please speak to your usual contact in Walkers or any of the key contacts listed below.
- assessing how the changes introduced by the Bill may impact the governance, management and employment arrangements in their businesses; and
- assisting with implementation of the necessary changes such as preparing maps and statements of responsibility, reviewing employment contracts and updating Fitness & Probity policies.