A new corporate governance code has been issued by the Irish Funds Industry Association to enable Irish listed corporate investment funds to comply with the requirements of Directive 2006/46 as transposed into Irish law. Directive 2006/46 of 14 June 2006 (the “Directive”) amends:
- Council Directive 78/660/EEC on the annual accounts of certain types of companies;
- Council Directive 83/349/EEC on consolidated accounts;
- Council Directive 86/635/EEC on the annual accounts and consolidated accounts of banks and other financial institutions; and
- Council Directive 91/674/EEC on the annual accounts and consolidated accounts of insurance undertakings
The Directive was implemented in Ireland by means of SI 450, the European Communities (Directive 2006/46/EC) Regulations 2009 (“SI 450”), as amended by SI 83, the European Communities (Directive 2006/46/EC) (Amendment) Regulations 2010 (“SI 83”).
The provisions of the Directive require certain disclosures to be included in the financial statements of listed companies, including a reference to the corporate governance code which these companies are subject to or which they voluntarily adopt. The transposing regulations (SI 450 and SI 83) apply these requirements to Irish listed corporate investment funds for years beginning on or after 18th November 2009 i.e. for the financial statements/directors reports for years ending after 17th November 2010.
Irish listed investment funds are subject to the regulatory requirements of the Central Bank, the relevant legislation and the requirements of the Irish Stock Exchange (together, the “Requirements”).
Accordingly the Legal & Regulatory Committee of the Irish Funds Industry Association drafted an investment funds corporate governance code reflecting the Requirements. This code has now been finalised and issued (available on http://www.irishfunds.ie) and may be adopted to address the requirements of SI 450, as amended.
It should be noted that a new and separate governance code for Irish investment funds is also being prepared in conjunction with the Financial Regulator further to its issuance of Consultation Paper 41 relating to “Corporate Governance Requirements for Credit Institutions and Insurance Undertakings”. Developments in this regard are addressed here