In March 2013, the Central Bank updated its Fitness and Probity – Frequently Asked Questions (“FAQs”) publication to include two additional questions in section three, ie, the section dealing with pre-approval controlled functions.

The Central Bank’s response to the new question 3.17 confirms that individuals who were in-situ at the time the fitness and probity regime was introduced and thus were not required to submit an individual questionnaire (“IQ”), will be required to receive approval from the Central Bank through the submission of an IQ if they are subject to re-election or re-appointment (eg, directors). The Central Bank states that once an individual has been approved to a role that is subject to re-election or re-appointment provisions, it is the Central Bank’s intention that he or she will not be required to undergo the approval process again as long as he or she remains in that role. However, upon re-election or re-appointment of such an individual, the board of directors of the firm will be required to confirm to the Central Bank that the individual’s circumstances have not change since pre-approval.

The Central Bank’s response to the new question 3.18 confirms that individuals who were in-situ in pre-approval controlled functions who are subject to employment contract renewals after the introduction of the fitness and probity regime may also be subject to the approval process. However, the Central Bank noted that there may be situations where the terms of a particular contract mean that a contract renewal does not constitute a re-appointment. The Central Bank stated that it is for the regulated financial service provider to determine, based on the contract terms and legal advice if appropriate, whether it is required to comply with the approval process. As above, it is intended that the initial approval will cover any subsequent contract renewals subject to the board of directors providing a confirmation to the Central Bank that the individual’s circumstances have not changed.

Click here to view the updated FAQs.