The Central Bank of Ireland (the ‘CBI’) recently published updated FAQs on the fitness and probity regime. These updates clarify the requirements for in-situ Pre-approval Controlled Functions (“PCFs”) in the case of their re-election or re-appointment.
PCFs who were in-situ at the time of the introduction of the new fitness and probity regime on 1 December 2011 were required to undergo due diligence by 31 March 2012 to confirm they had complied with the applicable fitness and probity requirements. They were not, however, required to submit an Individual Questionnaire (‘IQ’) to the CBI.
The new FAQs state that individuals who were able to take advantage of the grandfathering provisions must, if they are subject to re-election or re-appointment, submit an IQ to the CBI. If that submission is approved by the CBI, he will not be required to undergo the IQ approval process again for that PCF role. The board must, however, confirm on each re-election/ re-appointment that his circumstances have not changed since he was approved. This process may also apply where the employment contract of a relevant employee is renewed.
It is not necessary to submit IQs retrospectively for PCFs who were re-elected/re-appointed before 5 March 2013, but an IQ should be submitted when those PCFs are next re-elected/re-appointed.
The amended FAQs are of particular relevance to (non-captive) (re)insurers subject to the Corporate Governance Code for Credit Institutions and Insurance Undertakings, as, for example, the Code provides that the renewal of the CEO’s contract of employment must be reviewed at least every 5 years. It also requires the annual re-appointment of the Chairman.
The updated FAQs are available on the CBI’s website