Edition 2023, Issue No: 29 S.I. No. 176/2023 – Central Bank (Individual Accountability Framework) Act 2023 (Commencement Of Certain Provisions) Order 2023

S.I. No. 176 of 2023, the Central Bank (Individual Accountability Framework) Act 2023 (Commencement of Certain Provisions) Order 2023, has been published in the Irish Statute Book. This Order brings into effect multiple aspects of the Central Bank (Individual Accountability Framework) Act 2023, excluding those associated with individual accountability and standards.
The Individual Accountability Framework (IAF), when fully implemented, will empower the CBI to further bolster individual responsibility within the management and operation of Regulated Financial Service Providers (RFSP). The IAF comprises four primary elements:
– The Senior Executive Accountability Regime (SEAR) which mandates firms to identify accountability and decision-making within their senior management, further imposing a “duty of responsibility” on senior executives.
– Common Conduct Standards applicable to persons in controlled functions (CFs), additional Conduct Standards for individuals in pre-approval controlled functions (PCFs) and business standards for regulated firms.
– Strengthening the CBI’s existing fitness and probity (F&P) regime.
– Modifications to the CBI’s administrative sanctions procedure (ASP).
The recent Order was enacted and stated that Parts 1, 3 (excluding section 10), 4, 5, 6, and 7 of the Central Bank (Individual Accountability Framework) Act 2023 would come into operation on 19 April 2023.
Part 1 sets forth standard preliminary matters, including definitions and commencement arrangements. Part 3 broadens the CBI’s F&P regime to encompass specific classes of holding companies. Part 4 relates to the ASP and allows the CBI to bring direct enforcement actions against individuals for breaches of their obligations. Parts 3 and 4 also modify prior legislation to align with standards of fair procedure. Part 5 establishes a process of limited disclosure, allowing privileged material to be shared with the CBI without waiving the associated privilege. Lastly, parts 6 and 7 handle miscellaneous and transitional affairs.
The forthcoming implementation of the Act’s residual provisions, specifically the SEAR (Part 2), Conduct Standards, and the F&P certification requirement, is expected later in 2023. This will follow the CBI’s public consultation period, which will conclude on June 13, 2023 (please see eventid=20798).