RegBrief, Vol VI

This is the sixth edition of RegBrief, the quarterly bulletin of the Arthur Cox Financial Regulatory Group. RegBrief contains a summary of certain developments and is neither a complete nor a definitive statement of law or of regulation. Specific legal advice should be obtained before taking any action.

IRISH LEGAL AND REGULATORY DEVELOPMENTS

Mortgage Arrears

New Code: the revised Code of Conduct on Mortgage Arrears (CCMA) took effect on 1 July 2013. The Briefing issued by the Arthur Cox Finance Group on 3 July 2013 on the revised CCMA is available here. Internal Guideline: on 24 September 2013, following on from the publication in March 2013 of its Mortgage Arrears Resolution Targets (see our March 2013 Briefing here), the Central Bank published the final version of its Internal Guideline on Sustainable Mortgage Arrears Solutions (the Internal Guideline) for use by its supervisory teams when auditing the results of the Mortgage Arrears Resolution Targets (the Internal Guideline does not apply to measuring a bank's compliance with the CCMA). A draft of the Internal Guideline had first been published by the Central Bank on 24 July 2013. Ammending Legislation: the Land and Conveyancing Law Reform Act 2013 was signed into law on 24 July 2013. The Act is designed to rectify the issues which were first raised by Dunne J in the 2011 High Court decision in Start Mortgages Ltd & Ors v Gunn & Ors [2011] IEHC 275 regarding repossession proceedings in respect of registered land. Further detail is included in our recently published update on Legal Issues in Residential Mortgages (available here). New Targets: on 17 September 2013 the Central Bank announced that it had, in agreement with the Troika, set further targets for the banks as regards offering sustainable solutions to, and concluding arrangements with, customers in 90+ days mortgage arrears. Those targets are as follows: 70% of those customers must be offered a sustainable solution by 31 March 2014 concluded arrangements must be reached with 15% of those customers by 31 December 2013 concluded arrangements must be reached with 25% of those customers by 31 March 2014 Central Bank Reform Act 2010

On 19 September 2013 the last uncommenced provision of the Central Bank Reform Act 2010 was commenced by the Minister for Finance. This provision inserts a section into the Central Bank Act 1942 requiring the Central Bank to submit a strategic plan to the Minister for Finance every 3 years.

Central Bank (Supervision and Enforcement) Act 2013

This was signed into law on 11 July 2013 and came into effect on 1 August 2013, with the exception of Section 72 (the new 'name and shame' powers for the Financial Services Ombudsman) which came into effect on 1 September 2013. Our Briefing on the new Act is available here

Personal Insolvency Act 2012 (the PIA)

On 9 September 2013 the Insolvency Service of Ireland (the ISI) opened for business, having authorised a number of approved intermediaries (for the purposes of Debt Relief Notices) and personal insolvency practitioners (for the purposes of Debt Settlement Arrangements and Personal Insolvency Arrangements).

Following the amendment of the PIA by the Courts and Civil Law (Miscellaneous Provisions) Act 2013, the ISI also issued a number of regulations which, among other matters, deal with:

the fees for the authorisation and renewal of personal insolvency practitioner authorisations the fees and forms to be used in connection with applications for Debt Relief Notices or for Protective Certificates relating to Debt Settlement Arrangements and Personal Insolvency Arrangements account-preservation and recordkeeping obligations for personal insolvency practitioners the information that a debtor must provide in relation to his/her financial affairs and the form of prescribed financial statement that a debtor must complete restrictions on dealings with property above a certain value information to be included in a Schedule of Creditors procedures for the conduct of creditors' meetings We will shortly be publishing a detailed updated Briefing on the PIA and the above regulations. Commencement orders (to be signed by the Minister for Justice) in relation to the sections of the PIA and the Courts and Civil Law (Miscellaneous Provisions) Act 2013 that will reform the existing Bankruptcy Act 1988 are still awaited.

Credit Unions

Legislation: on 1 July 2013, the Minister for Finance published his implementation plan for those sections of the Credit Union and Co- Operation with Overseas Regulators Act 2012 that had not been commenced with the aim of allowing time for credit unions to prepare for the changes required by that Act. The provisions of the Act regarding restructuring and stabilisation came into force shortly after the Act was signed. Various other "standalone" sections came into force on 1 August 2013 (allowing credit unions the right to appeal certain Central Bank decisions to the Irish Financial Services Appeals Tribunal and disapplying certain banking legislation to credit unions). On 11 October 2013, provisions relating to new governance and prudential requirements for credit unions were commenced (with the exception of certain provisions, including those relating to boards of directors).

The remaining sections are expected to be commenced in two stages as follows:

March 2014: reductions in board numbers, the submission of annual compliance statements to the Central Bank and procedural provisions in relation to Board Oversight Committees Q2 2014: other prudential measures regarding savings, borrowing, lending, investments, reserves and liquidity Regulation: separately, the Central Bank published its draft Credit Union Handbook on 1 July 2013, seeking comments by 31 July 2013. The final version of Credit Union Handbook was then published on 12 September 2013 and included details of the Fitness and Probity Regime for Credit Unions (which commenced on 1 August 2013) and the new governance and prudential requirements for credit unions (many of which apply to credit unions from 11 October 2013, but some of which remain to be commenced). Further detail on the Fitness and Probity Regime for Credit Unions was also set out in the Central Bank's 8 August 2013 Regulatory Transactions Review and the Central Bank continues to update its dedicated webpage on fitness and probity for credit unions (most recently updating the Guidance on Fitness and Probity for Credit Unions, the PCF Information Guidance and PCF Resignation Guidance at the beginning of October 2013). Central Bank Consultation Papers

The Central Bank has published a number of consultation papers over recent months in relation to:

CP67: process improvements and service standards in respect of the authorisation process for regulated firms, funds and intermediaries CP68: the types of alternative...

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