Chapter III

Licensing and Supervision of Licence Holders

26. —Where, after consulting with the Bank and with such Ministers of the Government (if any) as he considers it appropriate to consult with in the circumstances, the Minister is of the opinion that, in respect of any class of financial business which is not supervised by the Bank under the Central Bank Acts, 1942 to 1989, it is necessary for—

(a) the protection of the public or any class thereof from financial loss, or

(b) the orderly and proper regulation of financial markets,

that such class of financial business ought to be either or both licensed and supervised by the Bank, he may by regulations apply to the said class all or any of the licensing and supervisory provisions (including those provisions which relate to auditors and liquidators) of Part II of the Act of 1971 or of this Chapter or Chapters I , II and IV with such modifications or adaptations as he considers appropriate.

27. —(1) The Minister may, by regulations made after consultation with the Bank, require the holder of a licence to establish or join in establishing a scheme or schemes for the investigation of complaints against that holder or an associated company in relation to a prescribed matter of complaint.

(2) Without prejudice to the generality of subsection (1), regulations under this section may make provision in relation to any one or more of the following—

(a) the establishment and administration of a scheme,

(b) the manner of appointment of an independent adjudicator to conduct investigations,

(c) the matters to be subject to investigation under the scheme,

(d) the grounds on which a complaint must be based,

(e) the powers of, and procedure to be followed in the conduct of investigations by, the adjudicator,

(f) the circumstances in and the extent to which determinations are binding,

(g) the procedures for the making of complaints,

(h) the publication of the adjudicator's findings,

(i) the approval of the scheme by the Bank.

(3) Subject to subsection (4), the reference of a complaint under a scheme established under this section shall not affect the rights of any person to have a dispute determined in any other manner provided by law.

(4) Where on a complaint under a scheme established under this section the parties concerned agree that a determination in accordance with the scheme shall be binding on them and the scheme provides for such an agreement, then the determination shall be binding on the parties.

(5) In this section “associated company” means (where appropriate)—

(a) a holding company or a subsidiary company (within the meanings respectively given to them by section 155 of the Companies Act, 1963 ),

(b) a company which is a subsidiary of a body corporate, where the holder of the licence concerned is also a subsidiary of the body corporate, but neither is a subsidiary of the other.

28. —(1) Each holder of a licence shall, within two months of the coming into operation of this section (in the case of existing licence holders) or of the grant of a licence (in any other case), notify the Bank of—

(a) all charges imposed by such holder in relation to the provision of any service to the public or to any class of the public, and

(b) any term or condition upon or subject to which such service is provided.

(2) The holder of a licence shall notify the Bank of every proposal—

(a) to change any charge, term or condition which has been previously notified to the Bank for the purposes of this section, or

(b) to impose any charge, term or condition, applying to the provision of a service to the public or to any class of the public, which has not been previously notified to the Bank for the purposes of this section.

(3) The Bank may direct the holder of a licence—

(a) to refrain from imposing or changing a charge, term or condition, applying to the provision of a service to the public or to any class of the public, without the prior approval of the Bank, and

(b) to publish, in such manner as may be specified by the Bank from time to time, information on any charge, term or condition applying to the provision of a service to the public or to any class of the public.

(4) A direction under this section may be expressed to apply—

(a) to every holder of a licence or to the holders of licences carrying on a specified type of banking business,

(b) to all services provided to the public or to any class of the public by the holders of licences concerned or to specified services or to services of a specified kind,

(c) in relation to a specified time or times or during a specified period or periods,

and the direction shall—

(i) be communicated to every holder of a licence concerned,

(ii) where not communicated in writing, be confirmed in writing to every such holder concerned as soon as possible thereafter, and

(iii) have effect in accordance with its terms.

(5) The Bank shall, in exercising its powers under this section, have regard to the promotion of fair competition between—

(a) holders of licences,

(b) holders of licences carrying on a particular type of banking business, and

(c) holders of licences to which paragraph (a) or (b) relates and such other institutions taking money on deposit as the Bank considers appropriate to take into account.

(6) The Bank may amend or revoke a subsisting direction under this section and may amend or revoke a subsisting direction which has been amended.

(7) The Bank may exempt a holder of a licence from the obligation to notify the Bank under this section in respect of—

(a) any charge which has been individually negotiated bona fide with the holder by a customer, or by or on behalf of a group of customers, of the holder, or

(b) a class of term or condition applying to a service provided by the holder, if the Bank is of the opinion that it is not necessary for it to be so notified in order to decide whether or not to issue a direction under subsection (3) in respect of the service.

(8) Any person who contravenes subsection (1), (2), (3) or (4) shall be guilty of an offence and shall be liable—

(a) on summary conviction, to a fine not exceeding £1,000 or, at the discretion of the court, to imprisonment for a term not exceeding 12 months, or to both, or

(b) on conviction on indictment, to a fine not exceeding £50,000 or, at the discretion of the court, to imprisonment for a term not exceeding 5 years, or to both,

and, if the contravention in respect of which he was convicted is continued after conviction, he shall be guilty of an offence on every day on which the contravention continues after conviction in respect of the original contravention and for each such offence he shall be liable on summary conviction to a fine not exceeding £100 or on conviction on indictment to a fine not exceeding £5,000.

(9) In this section, “charge” and “term or condition” do not include any rate of interest.

29. —Section 2 of the Act of 1971 is hereby amended—

(a) by the substitution, respectively, of the following definitions for the definitions of “banking business” and “the Court”:

“‘banking business’ means business which consists of—

(a) the business of accepting deposits payable on demand or on notice or at a fixed or determinable future date, or

(b) the business of taking funds, other than deposits, from the public payable on demand or on notice or at a fixed or determinable future date (whether or not involving the issue of securities or other obligations, however described),

but excluding—

(i) deposits with a trader from persons employed by him in his trading business or from his customers in the normal course of his trading business and deposits or instalments in respect of the letting or selling of goods under a hire-purchase agreement or a credit-sale agreement, or

(ii) the taking of other funds by a person from the public where it can be shown that—

(I) no part of the business activities of the person so taking or of any other person is financed wholly or substantially out of those funds, and

(II) such funds are, in the normal course of business, taken on a casual or incidental basis only,

or

(iii) moneys taken solely as a premium in respect of the issue or renewal of a life assurance policy issued by a holder of an authorisation under the European Communities (Life Assurance) Regulations, 1984 (S.I. No. 57 of 1984),

or either or both of the businesses aforesaid and any other business normally carried on by a bank and ‘banking’ and words cognate thereto shall be construed accordingly;

‘the Court’ means, except where the context otherwise requires, the High Court;”;

(b) by the substitution, respectively, of the following definitions for the definitions of “general fund”, “gold bullion”, “issue” and “legal tender note”:

“‘general fund’ means the fund to which section 63 of the Currency Act, 1927 , related and which continues to be kept by the Bank by virtue of section 23 of the Central Bank Act, 1989;

‘gold bullion’ includes any gold coins other than gold coins which are for the time being legal tender in the State;

‘issue’, when used in relation to legal tender notes, includes the re-issue of any such note which has ceased to be outstanding;

‘legal tender note’ means a legal tender note provided and issued under and in accordance with the Central Bank Acts, 1942 to 1989, and any other enactment amending or extending those Acts or under any Act repealed by the Central Bank Act, 1989;”.

30. —Section 7 of the Act of 1971 is hereby amended by the substitution of the following subsection for subsection (4):

“(4) (a) Subsection (1) of this section shall not apply in relation to—

(i) the central banks in the other states that are members of the European Communities,

(ii) the Agricultural Credit Corporation public limited company, the company formed and registered by virtue of section 2 of the Industrial Credit Act, 1933 , the Post Office Savings Bank, a trustee savings bank certified under the Trustee Savings Banks Acts, 1863 to 1979, or

(iii) a building society, an industrial and provident society, a friendly society, a credit union or the manager or trustee under a unit trust or collective investment scheme in respect of the carrying on of the business of the scheme.

(b) Where the Minister is of the opinion that it is in the interest of the orderly and proper regulation of banking or of any other financial market he may, after consultation with the Bank and with such Minister of the Government or other persons as he may consider appropriate to so consult in the circumstances, by order amend paragraph (a) (ii) so as to add thereto any body or category of persons or to delete therefrom any body or category of persons mentioned therein for the time being.”.

31. —The Act of 1971 is hereby amended by the substitution of the following section for section 8:

“8. (1) (a) Where, by reason only of a person's use in a name or title of any of the words ‘bank’, ‘banker’ or ‘banking’ or any word which is a variant, derivative or translation of or is analogous to any of those words, the person would be deemed to be holding himself out as a banker, the Bank may exempt the person from the provisions of section 7 of this Act if, in the opinion of the Bank, the person does not in fact carry on or propose to carry on banking business and does not otherwise hold himself out or represent himself as a banker or as carrying on banking business.

(b) The Bank may at any time revoke an exemption under this subsection where it is of the opinion that at any time after being exempted the person concerned has carried on banking business or otherwise has held himself out or represented himself as a banker or as carrying on a banking business and, upon the exemption being so revoked, that person shall forthwith take all necessary measures to cease using the name or title concerned containing the word to which the revoked exemption related.

(2) (a) The Bank may exempt any class or classes of person from the requirement for each of them to hold a licence where—

(i) the requirement would arise solely out of the issuing of securities or other obligations to which the definition of ‘banking business’ relates, and

(ii) the Bank is of the opinion that the exemption would not conflict with the orderly and proper regulation of banking.

(b) Where any class of persons have been exempted under this subsection from holding a licence and subsequently the Bank is of the opinion that the circumstances relevant to the exemption have changed and are such that that class would not now be so exempted, the Bank shall revoke the exemption.

(c) The Bank shall cause notice of every exemption and revocation under this subsection to be published in the Iris Oifigiúil.”.

32. —(1) Section 9 of the Act of 1971 is hereby amended:

(a) by the insertion of the following subsection after subsection (1):

“(1A) The Bank shall not grant a licence under this section to a person applying for it unless that person satisfies the Bank that it is—

(a) a company, or

(b) a credit institution within the meaning of Council Directive 77/780/EEC of 12 December, 1977⁽¹⁾, which has been duly authorised for the purposes of that Directive.”;

(b) by the substitution of the following subsection for subsection (3):

“(3) Whenever the Bank proposes to refuse to grant a licence to a person—

(a) it shall—

(i) within the period of six months after the date of the receipt of the application for the licence, or

(ii) where additional information in relation to the application has been sought by the Bank, within the period of six months after the date of the receipt by the Bank of the additional information or the period of twelve months after the date of the receipt of the application for the licence whichever period first expires,

notify the person in writing that it intends to seek the consent of the Minister to the proposed refusal and of its reasons for the refusal and that the person may, within the period of twenty-one days after the date of the giving of the notification, make representations in writing to the Minister in relation to the proposed refusal,

(b) the person may make such representations in writing to the Minister within the time aforesaid, and

(c) the Minister shall, before deciding to give or withhold his consent, consider any representations duly made to him under this subsection in relation to the proposed refusal.”.

(2) Section 10 (4) of the Act of 1971 shall stand repealed with effect from the coming into operation of subsection (1) (a).

33. —Section 10 of the Act of 1971 is hereby amended by the substitution of the following paragraph for paragraph (c) of subsection (3):

“(c) the Bank shall, before deciding to impose the condition or amend or add to the conditions of the licence, as the case may be, consider any representations duly made to it under this subsection in relation to the imposition, amendment or addition, as the case may be, and where, after so considering, the Bank decides on an imposition, amendment or addition, as the case may be, that differs from that specified in the notification concerned, it shall not be necessary to give a new notification under this subsection if the difference results in the condition concerned being no more onerous than would be the case had the Bank decided to impose the condition or amend or add to the conditions of the licence, as the case may be, in accordance with the notification concerned.”.

34. —The Act of 1971 is hereby amended by the substitution of the following section for section 11:

“11. (1) The Bank may—

(a) revoke a licence if the holder of the licence so requests,

(b) with the consent of the Minister, revoke a licence if the holder of the licence—

(i) (I) has not commenced to carry on banking business within twelve months of the date on which the licence was granted, or

(II) has ceased to carry on banking business and has not carried it on during a period of more than six months immediately following the cesser,

(ii) being a company, is being wound up,

(iii) is a credit institution to which section 9 (IA) (b) of this Act (as amended by the Central Bank Act, 1989) relates, which is being duly wound up or otherwise dissolved,

(iv) has obtained the licence through false statements or any other irregular means,

(v) becomes unable to meet his obligations to his creditors or suspends payments lawfully due by him or no longer possesses sufficient own funds (being own funds to which Council Directive 77/780/EEC of 12 December, 1977, relates) or can no longer be relied upon to fulfil his obligations towards his creditors, and in particular no longer provides security for the assets entrusted to him,

(vi) fails to maintain a deposit in the Bank of an amount determined in accordance with section 55 of the Central Bank Act, 1989,

(vii) is convicted on indictment of an offence under any provision of this Act or an offence involving fraud, dishonesty or breach of trust,

(viii) has his head office in another state that is a member of the European Communities and the authority in that state that exercises in that state functions corresponding to those of the Bank under this Chapter has withdrawn authorisation from the institution of which the holder is a branch,

(c) with the consent of the Minister, revoke the licence if, since the grant of the licence, the circumstances relevant to the grant have changed and are such that, if an application for a licence were made in the changed circumstances, it would be refused.

(2) Whenever the Bank proposes to revoke a licence (other than in circumstances to which paragraph (a) or (b) (viii) of subsection (1) of this section relate)—

(a) it shall notify the holder in writing that it intends to seek the consent of the Minister to the revocation and of the reasons for the revocation and that the holder may, within twenty-one days after the date of the giving of the notification, make representations in writing to the Minister in relation to the proposed revocation,

(b) the holder may make such representations in writing to the Minister within the time aforesaid, and

(c) the Minister shall, before deciding to give or withhold his consent, consider any representations duly made to him under this subsection in relation to the proposed revocation.

(3) Where a licence is revoked and the person who was the holder of the licence is not a company which is being wound up—

(a) that person shall continue to be subject to the duties and obligations imposed on him by or under the Central Bank Acts, 1942 to 1989, until all liabilities of that person in respect of deposits (including deposits on current accounts) or other repayable funds accepted by him from persons (in this subsection referred to as depositors) have been discharged to the satisfaction of the Bank,

(b) that person shall, as soon as possible after the licence is revoked—

(i) notify the Bank and

(ii) as far as is reasonably practicable, notify every depositor concerned,

of the measures he is taking or proposes to take to discharge in full and without undue delay his liabilities in respect of those deposits,

(c) in the case where—

(i) that person has notified the Bank in accordance with paragraph (b) of this subsection and the Bank is of the opinion that the measures being taken or proposed to be taken for the purposes of that paragraph are not satisfactory, or

(ii) that person has not so notified the Bank and the Bank is of the opinion that he has failed to so notify as soon as possible after the licence is revoked, or

(iii) the Bank is of the opinion that that person has not taken all reasonable steps to so notify every depositor concerned,

then the Bank may give a direction in writing to that person for such period, not exceeding six months, as may be specified therein, prohibiting him from—

(I) dealing with or disposing of any of his assets or specified assets in any manner, or

(II) engaging in any transaction or class of transaction or specified transaction, or

(III) making payments,

without the prior authorisation of the Bank, and the Bank may require that person to prepare and submit to it for its approval within two months of the direction, a scheme for the orderly discharge in full of his liabilities to the depositors concerned,

(d) where a direction to which this subsection relates is given the provisions of section 21 of this Act shall apply with any necessary modifications.

(4) (a) Where a licence is revoked and the holder of the licence is a company which is being wound up, the liquidator of the company shall, in addition to his duties and obligations in respect of the winding up, be subject to the duties and obligations to which the company would be subject were it a company to which subsection (3) of this section relates and that subsection shall, for the purposes of this subsection, be construed accordingly.

(b) Notwithstanding paragraph (a) of this subsection, the Bank may, where it revokes a licence and considers it appropriate in the circumstances, remove in writing the duty and obligation imposed on the liquidator concerned to comply with paragraph (b) (as construed by this subsection) of subsection (3) of this section and may impose in writing on that liquidator such further or other duty and obligation which corresponds to that set out in the said paragraph (b).

(5) If the holder of a licence—

(a) has his head office in another state that is a member of the European Communities, or

(b) carries on banking business through a branch established in another such state,

the Bank shall, before deciding to revoke the licence, consult with the authority in that state that exercises in that state functions corresponding to those of the Bank under this Part:

Provided however that if immediate action by the Bank is called for it shall not be necessary for the Bank to consult as aforesaid but in such a case the Bank shall notify the authority concerned of the revocation of the licence.”.

35. —Section 12 of the Act of 1971 is hereby amended by the substitution of the following subsection for subsection (3):

“(3) The Bank shall keep each of the following informed of the names of the holders of licences, that is to say:

(a) the Commission of the European Communities;

(b) the Registrar of the Supreme Court;

(c) the officer for the time being managing the Central Office of the High Court;

(d) every County Registrar;

(e) every District Court Clerk.”.

36. —The Act of 1971 is hereby amended by the substitution of the following section for section 17:

“17.—(1) A holder of a licence shall keep at an office or offices within the State such books and records (including accounts) as may be specified from time to time by the Bank in the due discharge by the Bank of its statutory functions and shall notify the Bank of the address of every office at which any such book or record is kept for the purposes of this subsection.

(2) Different books and records may be specified by the Bank for the purposes of this section in relation to different holders of licences.

(3) (a) An appropriate person duly authorised in writing in that behalf by the Governor of the Bank (in this subsection referred to as ‘an authorised person’) may, for the purpose of the performance by the Bank of its statutory functions and upon production of his authorisation, at all reasonable times, inspect and take copies of or extracts from, and make such enquiries as he may consider necessary in relation to—

(i) the books and records kept pursuant to this section by the holder of a licence, and

(ii) any books of account relating to the said holder and kept under the Companies Act, 1963 , or under any enactment which is to be construed together as one with that Act, and

(iii) any other documents relating to the business of the said holder,

and for those purposes enter any office to which subsection (1) of this section relates and any other place where he reasonably believes any books, records or other documents as aforesaid are kept.

(b) A person who has in his power, possession or procurement any books, records or other documents aforesaid shall—

(i) produce them at the request of an authorised person and permit him to inspect and take copies of or extracts from them,

(ii) at the request of an authorised person, give any information which may be reasonably required with regard to them, and

(iii) give such other assistance and information to an authorised person as is reasonable in the circumstances.

(c) The provisions of paragraphs (a) and (b) of this subsection shall apply to every holder of a licence and the provisions of those paragraphs, other than subparagraph (i) of paragraph (a), shall apply to—

(i) every associated enterprise of the holder, and

(ii) any other person,

where an inspection of the books, records or other documents is, in the opinion of the Bank, materially relevant to the proper appraisal of the business of a holder of a licence during any period in respect of which an inspection or proposed inspection of the holder relates.

(4) Books and records kept pursuant to this section shall—

(a) be in addition to any books or other records to be kept by or under any other enactment, and

(b) be retained for at least such period as the Bank may specify in respect of any such book or record.

(5) Where any person from whom production of a book, record or other document is required claims a lien thereon, the production of it shall be without prejudice to the lien.

(6) Nothing in this section shall compel the production by a barrister or solicitor of a book, record or other document containing a privileged communication made by him or to him in that capacity or the furnishing of information contained in a privileged communication so made.

(7) (a) In this section—

‘appropriate person’ means—

(i) an officer of the Bank, or

(ii) in relation to any particular inspection (including a proposed inspection), any other person who in the opinion of the Governor of the Bank possesses appropriate qualifications or experience to carry out the inspection, or any part thereof, to which this section relates;

‘associated enterprise’ means (where appropriate)—

(i) a holding company of the holder of a licence,

(ii) a subsidiary company of the holder of a licence,

(iii) a company which is a subsidiary of a body corporate, where the holder of the licence concerned is also a subsidiary of the body corporate, but neither company is a subsidiary of the other,

(iv) where a company is the holder of a licence, any other body corporate that is not a subsidiary of the company but in respect of which the company is beneficially entitled to more than 20 per cent. in nominal value of either the allotted share capital or of the shares carrying voting rights (other than voting rights which arise only in specified circumstances) in that other body corporate,

(v) a partnership in which the holder of a licence has an interest, and whose business is or, at the relevant time, was, in the opinion of the Bank, materially relevant to any inspection of the holder being carried out or proposed to be carried out under this section;

‘holding company’ has the meaning given to it by section 155 of the Companies Act, 1963 ;

‘statutory functions’, in relation to the Bank, means its functions—

(i) under the Central Bank Acts, 1942 to 1989, and any other enactment amending those Acts, or

(ii) imposed by virtue of the European Communities (Consolidated Supervision of Banks) Regulations, 1985 (S.I. No. 302 of 1985), and Council Directive No. 85/354/EEC ⁽¹⁾ of 13 June, 1983;

‘subsidiary company’ has the meaning given to it by section 155 of the Companies Act, 1963 .

(b) References in this section to books, records or other documents, or to any of them, shall be construed as including any document or information kept in a non-legible form (by the use of electronics or otherwise) which is capable of being reproduced in a legible form and all the electronic or other automatic means, if any, by which such document or information is so capable of being reproduced to which the person, whose books, records or other documents (as so construed) are inspected for the purposes of this section, has access.”.

37. —The Act of 1971 is hereby amended by the substitution of the following section for section 18: (1)

“18. (1) A holder of a licence and any person carrying on a business—

(a) of an associated enterprise to which subsection (3) of this section relates,

(b) in respect of which that person is, by virtue of section 7 (4) (a) (ii) of this Act, exempted from the obligation to hold a licence,

(c) as an investment trust company,

(d) as a moneybroker,

(e) as a financial intermediary, or

(f) of issuing, holding or otherwise participating in any market in financial instruments including those to which Chapter VIII of the Central Bank Act, 1989, applies;

shall each furnish the Bank—

(i) at such times as the Bank may specify from time to time, such information and returns concerning the business to which the licence relates or the carrying on of a business as aforesaid by such person, as the case may be, as the Bank may specify from time to time, being information and returns which the Bank considers it necessary to have for the due performance of its statutory functions;

(ii) within such period as the Bank may specify, any information and returns (not being information or returns specified under paragraph (i) of this subsection) concerning the business to which the licence relates or the carrying on of a business as aforesaid by such person, as the case may be, that the Bank may request in writing, being information and returns which the Bank considers it necessary to have for the due performance of its statutory functions.

(2) A person shall not furnish information or returns under this section which he knows to be false.

(3) Subsections (1) and (2) of this section shall apply to the business of an associated enterprise to the extent only that the information and returns sought by the Bank are, in the opinion of the Bank, materially relevant to the proper appraisal of the business of the holder of the licence to which the associated enterprise relates.

(4) In this section:

‘>associated enterprise’ has the same meaning as it has in section 17 of this Act;

‘information and returns’ and ‘information or returns’ includes audited accounts, audited group accounts and any other documents which are equivalent or correspond to such audited accounts or audited group accounts;

‘moneybroker’ has the meaning assigned to it by section 108 of the Central Bank Act, 1989, for the purposes of Chapter IX of that Act.”.

38. —The Act of 1971 is hereby amended by the substitution of the following section for section 21:

“21.—(1) Where the Bank is of the opinion that it is in the public interest to do so, or that the holder of a licence—

(a) has become or is likely to become unable to meet his obligations to his creditors, or

(b) is not maintaining or is unlikely to be in a position to maintain adequate capital resources having regard to the volume and nature of his business, or

(c) has failed to comply with any condition imposed in relation to the licence in accordance with section 10 of this Act and the circumstances are such that the Bank is of the opinion that the stability and soundness of the holder are affected by such failure, or

(d) is conducting business in such a manner as to jeopardise and prejudice the security of deposits taken by him or the rights and interests of persons who made those deposits, or

(e) is under common control with one or more than one other enterprise (whether or not any such other enterprise is the holder of a licence) and the Bank is of the opinion that the common control is not in the interest of persons maintaining deposits with the first mentioned holder of a licence,

the Bank may give a direction in writing to that holder to suspend, for such period, not exceeding six months, as shall be specified in the direction, all or any of the following, that is to say—

(i) the carrying on of banking business,

(ii) the making of payments to which paragraph (i) of this subsection does not relate,

(iii) the acquisition or disposal of other assets or liabilities,

which have not been authorised by the Bank.

(2) The Bank may revoke a direction given under subsection (1) of this section unless an order under subsection (4) of this section has been made in respect of the direction.

(3) The holder of a licence to whom a direction is given under subsection (1) of this section may apply to the Court for, and the Court may grant, an order setting aside the direction.

(4) The Bank may apply to the Court for, and the Court may grant, an order confirming a direction given under subsection (1) of this section or confirming the direction and subject to subsection (5) of this section extending the period of its operation for such time, not exceeding the period of twelve months from the date the direction commenced to have effect, as the Court may, having regard to all the circumstances, consider appropriate.

(5) A direction to which subsection (4) of this section relates shall cease to have effect—

(a) where the direction was confirmed, upon the expiration of the period to which the direction relates,

(b) where the direction was confirmed and the period of its operation was extended, upon the expiration of that extended period,

(c) from such date as the Court by order determines on a subsequent application to it by the Bank,

(d) upon the making of a winding up order in respect of the holder of the licence concerned, or

(e) where the Court is of the opinion that the circumstances which gave rise to the direction have ceased to exist and that it would be unjust and inequitable not to make an order to that effect, from such date as the Court by order determines,

whichever first occurs.

(6) The Court may, in addition to or in lieu of making an order under subsection (3) or (4) of this section, make such other order in relation to the matter as may appear to it to be necessary, including an order directing any person who holds money or other assets for or on behalf of the person to whom the direction relates not to dispose of any of those assets except on such conditions and in such circumstances as are specified in the order.

(7) Where a direction given under this section is a subsisting direction, then—

(a) winding up or bankruptcy proceedings shall not be initiated in relation to the holder of the licence to whom the direction was given,

(b) a receiver over the property of that holder shall not be appointed, and

(c) the property of that holder shall not be attached, sequestered or otherwise distrained,

unless the prior approval of the Court has been obtained.

(8) (a) Where the Bank is of the opinion that, notwithstanding the fact that the holder of the licence to whom the direction was given under this section appears to it to be able to meet his obligations to his creditors, the circumstances which gave rise to the direction are unlikely to be rectified, it shall forthwith apply to the Court for, and the Court may grant, an order directing the holder to prepare, in consultation with the Bank, a scheme for the orderly termination of his banking business and the discharge of his liabilities to persons who have deposits maintained with him under the supervision of the Bank and to submit the scheme to the Court within two months for the Court's approval.

(b) The Court shall not approve the terms of the scheme without hearing the Bank and, in the event of any dispute concerning the terms of the scheme, either or both the Bank and the holder of the licence to whom the direction was given may apply to the Court to adjudicate on the matter.

(c) If the holder of the licence to whom the direction was given fails to comply with the order of the Court or fails to adhere to the scheme approved by the Court, the Bank may apply to the Court for and the Court may make such further order as it considers appropriate, including an order of commital or a winding up order on the ground that it is just and equitable that the holder should be wound up.

(9) Where, in proceedings brought under this section against the holder of a licence to whom a direction was given under this section, a winding up order is made, the law relating to companies (including this Act) shall apply in the same way as if the order had been made on a winding up petition under that law and as if for any reference in that law to the presentation of the winding up petition there were substituted a reference to the making of the winding up order under this section.

(10) Where the Court is satisfied, because of the nature or the circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings under this section may be heard otherwise than in public.

(11) The Court may by order revoke or amend an order made by it under this section.

(12) For the purpose of subsection (1) (e) of this section, the holder of a licence and one or more than one other enterprise shall be deemed to be under common control if the decision as to how or by whom each shall be managed can be made by the same person or is made by the same group of persons acting in concert.”.

39. —Section 22 of the Act of 1971 is hereby amended:

(a) by the substitution of the following subsections for subsection (2):

“(2) The Bank may give a direction to a holder of a licence to refrain from—

(a) publishing or continuing to publish, or

(b) causing to be published or to be continued to be published,

during such period as shall be specified in the direction an advertisement inviting deposits from the public.

(2A) The Bank may give a direction to a holder of a licence to refrain from—

(a) publishing or continuing to publish, or

(b) causing to be published or to be continued to be published,

an advertisement containing information in respect of any service provided or to be provided to the public or any charge, term or condition upon which a service is so provided (or to be so provided) which, in the opinion of the Bank is false, misleading or calculated to deceive.”;

(b) by the addition of the following subsection after subsection (3):

“(4) In this section:

‘advertisement’ includes every form of recommendation of any matter to which this section relates including, in particular, the display or publication of any such matter by way of notice, leaflet, circular, pamphlet, brochure, photograph, film, video, sound broadcasting, television, electronic communication or personal canvassing;

‘deposits’ includes any funds taken from the public and payable on demand or on notice or at a fixed or determinable future date.”.

40. —Section 23 of the Act of 1971 is hereby amended by the substitution of the following subsection for subsection (4):

“(4) In this section—

‘liabilities’ include such contingent liabilities as may be specified by the Bank from time to time for the purposes of this section;

‘specified’ means specified by the Bank in a requisition under this section.”.

41. —The Act of 1971 is hereby amended by the insertion of the following section after section 23:

“23A. The Bank may, from time to time, specify as respects a holder of a licence requirements as to the composition of its assets and requirements as to the composition of its liabilities.”.

42. —Section 26 of the Act of 1971 is hereby amended by the addition of the following subsection—

“(7) The Minister may, after consultation with the Bank and where he is of the opinion that it would not be against the orderly and proper regulation of banking, by order—

(a) in the case of either or both subsections (2) and (3) of this section, apply those subsections or restrict their application to any person or class of persons, and

(b) in the case of subsection (6) of this section, amend that subsection by the addition thereto or deletion therefrom, of any instrument specified in that subsection,

and, in the case of each subsection, whether or not previously affected by virtue of this subsection.”.

43. —Section 27 of the Act of 1971 is hereby amended:

(a) by the insertion of the following subsection after subsection (2):

“(2A) If an advertisement or other solicitation for deposits is published and it does not include the name and address of the person who arranged with the publisher for the advertisement or solicitation, then the Bank may, at any time within the period of twelve months after any publication of the advertisement, request the publisher to supply the name and address of that person to the Bank and the publisher shall forthwith comply with that request.”;

(b) by the substitution of the following subsection for subsection (3):

“(3) (a) In this section ‘deposits’ does not include deposits with a trader by persons employed by him in his trading business or by his customers in the normal course of his trading business or deposits in respect of the letting or selling of goods under a hire-purchase agreement or a credit-sale agreement.

(b) Reference in this section or section 58 (3) of this Act (as amended by section 9 of the Central Bank Act, 1989) to the solicitation of deposits, however expressed, includes every form of solicitation for deposits including, in particular, the display or publication of any such matter by way of notice, leaflet, circular, pamphlet, brochure, photograph, film, video, sound broadcasting, television, electronic communication or personal canvassing.”.

44. —The Act of 1971 is hereby amended by the insertion of the following section after section 28:

“28A. (1) Where, on an application made in a summary manner by the Bank, the Court is of the opinion that there has occurred or is occurring—

(a) a contravention of section 17 or 18 of this Act, or

(b) a failure to comply with a condition imposed in relation to a licence by virtue of section 10, or with a direction under section 22 , of this Act,

the Court may, by order, prohibit the continuance of the contravention or failure by the person or persons concerned.

(2) The Court when considering the matter may make such interim or interlocutory order as it considers appropriate.

(3) Where the Court is satisfied, because of the nature or the circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings under this section may be heard otherwise than in public.”.

45. —Section 31 of the Act of 1971 is hereby amended by the substitution of the following subsection for subsection (1):

“(1) Where a holder of a licence ceases to carry on banking business in circumstances to which section 57 of the Central Bank Act, 1989, applies, he shall, as soon as may be, notify all persons having deposits (including deposits on current accounts) with him of such cesser and he shall, if any such person so demands, pay to that person forthwith the amount of his deposit together with the amount of any interest accrued thereon.”.

46. —(1) The Bank may, in writing require any holder of a licence—

(a) to notify the Bank at least 15 days—

(i) before notices are sent to the shareholders concerning the proposed appointment or reappointment of a person to the office of auditor of the holder for the purposes of the Companies Acts, 1963 to 1986, or

(ii) before the directors of the holder fill any casual vacancy in the office of auditor by virtue of section 160 (7) of the Companies Act, 1963 ,

of the name of the person to be so proposed, to be reappointed or to fill that vacancy,

(b) to supply, within such period of time as the Bank shall state, such information as it may request concerning the person named for the purpose of paragraph (a).

(2) Where the Bank is of the opinion that it would not be in the interest of persons maintaining deposits with the holder of a licence or of the orderly and proper regulation of banking, it may direct, as the circumstances require, that holder not to appoint or not to reappoint to the office of auditor, or the directors not to fill a casual vacancy in that office with, a named person and the direction shall be complied with.

(3) Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable—

(a) on summary conviction, to a fine not exceeding £1,000 or, at the discretion of the court, to imprisonment for a term not exceeding 12 months, or to both, or

(b) on conviction on indictment, to a fine not exceeding £50,000 or, at the discretion of the court, to imprisonment for a term not exceeding 5 years, or to both.

47. —(1) If the auditor of a holder of a licence—

(a) has reason to believe that there exist circumstances which are likely to affect materially the holder's ability to fulfil his obligations to persons maintaining deposits with him or meet any of his financial obligations under the Central Bank Acts, 1942 to 1989, or

(b) has reason to believe that there are material defects in the financial systems and controls or accounting records of the holder, or

(c) has reason to believe that there are material inaccuracies in or omissions from any returns of a financial nature made by the holder to the Bank, or

(d) proposes to qualify any certificate which he is to provide in relation to financial statements or returns of the holder under the Companies Acts, 1963 to 1986, or the Central Bank Acts, 1942 to 1989, or

(e) decides to resign or not seek re-election as auditor,

he shall report the matter to the Bank in writing without delay.

(2) The auditor of the holder of a licence shall, if requested by the Bank, furnish to the Bank a report stating whether in his opinion and to the best of his knowledge the holder has or has not complied with a specified obligation of a financial nature under the Central Bank Acts, 1942 to 1989.

(3) Where the auditor of a holder of a licence so requests, the Bank shall provide to the auditor in writing details of such returns of a financial nature to the Bank by the holder as the auditor requests for the purpose of enabling him to comply with subsection (1) (c) or (2).

(4) The auditor of a holder of a licence shall send to the holder a copy of any report made by him to the Bank under subsection (1) or (2).

(5) (a) Whenever the Bank is of the opinion that the exercise of its functions under the Central Bank Acts, 1942 to 1989, or the protection of the interests of depositors so requires, it may require the auditor of a holder of a licence to supply it with such information as it may specify in relation to the audit of the business of the holder and the auditor shall comply with the requirement.

(b) The Bank may require that, in supplying information for the purposes of this subsection, the auditor shall act independently of the holder of the licence.

(6) No duty to which the auditor of a holder of a licence may be subject shall be regarded as contravened, and no liability to the holder, or to its shareholders, creditors or other interested parties, shall attach to the auditor, by reason of his compliance with any obligation imposed on him by or under this section.

⁽¹⁾OJ No. L322, 17.12.1977, p. 30.

OJ No. L193 18.7.1983, p.18.