IRELAND Law and Practice Contributed by: Keith Robinson, Barry Tyrrell and Julia Mullin, Dillon Eustace LLP
1. Legal Framework 1.1 Key Laws and Regulations
developed various regulations and guidelines addressing various areas relevant to the over - sight of banks and the protection of consum - ers including corporate governance; mortgage arrears; consumer protection; minimum compe - tency requirements; fitness and probity stand - ards; individual accountability; and lending to SMEs. The CBI is supervised in its regulation of banks in Ireland by the European Central Bank (the “ECB”) under the SSMR. These regulations and codes ensure that Irish banks operate within a frame - work that promotes transparency, accountability and fairness in their dealings with customers and in managing their internal operations. Through its broad regulatory powers, the CBI plays a cru - cial role in maintaining the stability and integrity of the Irish banking system. In addition to the Central Bank Acts the follow - ing key pieces of legislation are also applicable to Irish banks. • The European Union (Capital Requirements) Regulations 2014. • The European Union (Capital Requirements) (No 2) Regulations 2014 (the “Irish Capital Regulations”). • The EU Directive 2013/36 (“CRD IV”) as amended by Directive (EU) 2019/878 (collec - tively with CRD IV, “CRD V”). • The Capital Requirements Regulation (575/2013/EU) (“CRR”) as amended by Regu - lation 2019/876. Banks are also required to comply with various pieces of secondary legislation and codes issued under the Central Bank Acts including the CBI’s Corporate Governance Requirements for Credit Institutions 2015 (the “CGR”) and the Consumer Protection Code 2012 (as amended) (the “CPC”).
The banking industry in Ireland is governed by both national laws and EU legislation, which is either directly effective or transposed into Irish law through local measures. The regulation of banking activities in Ireland is primarily governed by the Single Supervisory Mechanism Regulation ((EU) 1024/2013) (the “SSMR”) and the Central Bank Acts 1942-2018 (the “Central Bank Acts”). The Central Bank Act 1942 established the CBI as the primary regula - tor for banking activities in Ireland. The Central Bank Reform Act 2010 modified the regulatory framework in Ireland including the CBI’s super - visory culture and approach. The CBI’s enforcement powers were further enhanced through the Central Bank (Supervi - sion and Enforcement) Act 2013 (the “2013 Act”). The CBI has broad enforcement powers to deter reckless behaviour and to promote cul - tures consistent with those expected in the post financial crash financial system. The 2013 Act contains penalties which may be imposed on individuals and regulated firms. Relevant indi - viduals are subject to fines of up to EUR1 mil - lion and regulated firms subject to fines of up to EUR10 million or 10% of the previous year’s turnover, whichever is greater. The Central Bank Act 1971 mandates that any entity conducting “banking business” in Ireland must obtain a banking licence. This Act also out - lines specific requirements and conditions that banks must follow to operate in Ireland. Under the Central Bank Acts, the CBI is author - ised to issue regulations and codes of prac - tice that banks must adhere to. The CBI has
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