Credit Union Act 1997

Credit Union Act 1997


Number 15 of 1997


CREDIT UNION ACT 1997

REVISED

Updated to 21 September 2018


This Revised Act is an administrative consolidation of the Credit Union Act 1997. It is prepared by the Law Reform Commission in accordance with its function under the Law Reform Commission Act 1975 (3/1975) to keep the law under review and to undertake revision and consolidation of statute law.

All Acts up to and including Companies (Statutory Audits) Act 2018 (22/2018), enacted 25 July 2018, and all statutory instruments up to and including Companies (Statutory Audits) Act 2018 (Commencement) Order 2018 (S.I. No. 366 of 2018), made 19 September 2018, were considered in the preparation of this Revised Act.

Disclaimer: While every care has been taken in the preparation of this Revised Act, the Law Reform Commission can assume no responsibility for and give no guarantees, undertakings or warranties concerning the accuracy, completeness or up to date nature of the information provided and does not accept any liability whatsoever arising from any errors or omissions. Please notify any errors, omissions and comments by email to

revisedacts@lawreform.ie.


Number 15 of 1997


CREDIT UNION ACT 1997

REVISED

Updated to 21 September 2018


Introduction

This Revised Act presents the text of the Act as it has been amended since enactment, and preserves the format in which it was passed.

Related legislation

Credit Union Acts 1997 to 2018 : this Act is one of a group of Acts included in this collective citation, to be construed together as one ( Companies (Statutory Audits) Act 2018 (22/2018), s. 1(7)). The Acts in this group are:

Credit Union Act 1997 (15/1997)

Euro Changeover (Amounts) Act 2001 (16/2001), ss. 6 and 9(3)

Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), other than ss. 36, 37, 48(2), and 56(3), Part 5 and Schedules 2-5

Companies (Statutory Audits) Act 2018 (22/2018), s. 72

Annotations

This Revised Act is annotated and includes textual and non-textual amendments, statutory instruments made pursuant to the Act and previous affecting provisions.

An explanation of how to read annotations is available at

www.lawreform.ie/annotations.

Material not updated in this revision

Where other legislation is amended by this Act, those amendments may have been superseded by other amendments in other legislation, or the amended legislation may have been repealed or revoked. This information is not represented in this revision but will be reflected in a revision of the amended legislation if one is available.

Where legislation or a fragment of legislation is referred to in annotations, changes to this legislation or fragment may not be reflected in this revision but will be reflected in a revision of the legislation referred to if one is available.

A list of legislative changes to any Act, and to statutory instruments from 1979, may be found linked from the page of the Act or statutory instrument at

www.irishstatutebook.ie.

Acts which affect or previously affected this revision

Companies (Statutory Audits) Act 2018 (22/2018)

Financial Services and Pensions Ombudsman Act 2017 (22/2017)

Competition and Consumer Protection Act 2014 (29/2014)

Central Bank (Supervision and Enforcement) Act 2013 (26/2013)

Personal Insolvency Act 2012 (44/2012)

Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012)

Central Bank and Credit Institutions (Resolution) Act 2011 (27/2011)

Credit Institutions (Stabilisation) Act 2010 (36/2010)

Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (24/2010)

Central Bank Reform Act 2010 (23/2010)

Markets in Financial Instruments and Miscellaneous Provisions Act 2007 (37/2007)

Investment Funds, Companies and Miscellaneous Provisions Act 2005 (12/2005)

Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004)

Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003)

Euro Changeover (Amounts) Act 2001 (16/2001)

Central Bank Act 1997 (8/1997)

Central Bank 1942 (22/1942)

All Acts up to and including Companies (Statutory Audits) Act 2018 (22/2018), enacted 25 July 2018, were considered in the preparation of this revision.

Statutory instruments which affect or previously affected this revision

Credit Union Act 1997 (Regulatory Requirements) (Amendment) Regulations 2018 (S.I. No. 32 of 2018)

Credit Union Act 1997 (Regulatory Requirements) Regulations 2016 (S.I. No. 1 of 2016)

Credit Union Act 1997 (Section 85) Rules 2010 (S.I. No. 515 of 2010)

Credit Union Act 1997 (Section 85) Rules 2009 (S.I. No. 344 of 2009)

Credit Union Act 1997 (Exemption from Additional Services Requirements) (Amendment) Regulations 2007 (S.I. No. 838 of 2007)

Credit Union Act 1997 (Alteration of Financial Limits) Regulations 2007 (S.I. No. 193 of 2007)

Credit Union Act 1997 (Exemption From Additional Services Requirements) Regulations 2007 (S.I. No. 107 of 2007)

Credit Union Act 1997 (Alteration of Financial Limits) Regulations 2006 (S.I. No. 546 of 2006)

Credit Union Act 1997 (Alteration of Financial Limits) Order 2006 (S.I. No. 453 of 2006)

Credit Union Act 1997 (Exemption From Additional Services Requirements) Regulations 2004 (S.I. No. 223 of 2004)

Credit Union Act, 1997 (Alteration of Financial Limit) Regulations 2001 (S.I. No. 476 of 2001)

Credit Union Act, 1997 (Commencement) Order 2001 (S.I. No. 378 of 2001)

Credit Union Act, 1997 (Fees) Regulations 1998 (S.I. No. 155 of 1998)

Credit Union Act, 1997 (Commencement) Order 1997 (S.I. No. 403 of 1997)

All statutory instruments up to and including Companies (Statutory Audits) Act 2018 (Commencement) Order 2018 (S.I. No. 366 of 2018), made 19 September 2018, were considered in the preparation of this revision.


Number 15 of 1997


CREDIT UNION ACT 1997

REVISED

Updated to 21 September 2018


ARRANGEMENT OF SECTIONS

PART I

Preliminary and General

Section

1.

Short title and commencement.

2.

Interpretation.

3.

Orders and regulations.

4.

Expenses incurred by the Minister.

5.

Repeals and transition from the former law.

PART II

Registration and Membership

Registration

6.

Conditions for registration as a credit union.

6A.

Supplemental provisions relating to registration, etc., under section 6 of Principal Act.

7.

Application for registration as a credit union.

8.

Acknowledgement or refusal of registration.

9.

Effect of registration.

10.

Registered name.

11.

Change of registered name.

12.

Protection of use of seal and registered name of credit union.

Rules

13.

Rules.

14.

Amendment of registered rules.

15.

Rules to bind members.

16.

Provision of copies of rules.

Membership

17.

Requirements of, and qualifications for, membership.

18.

Appeal against refusal of membership.

19.

Expulsion and withdrawal from credit union.

20.

Remedy for debts from members.

21.

Nomination of property in credit union.

22.

Proceedings on death of nominator.

23.

Provision for small payments on death.

24.

Payments in respect of mentally incapable persons.

25.

Validity of payments to persons apparently entitled.

PART III

Operation of Credit Unions

Business and raising of funds

26.

General principles.

27.

Raising of funds by shares and deposits.

27A.

Protection of members’ savings.

Shares and deposits

28.

Shares: general provisions.

29.

Transfer of shares.

30.

Dividends on shares.

31.

Interest on deposits.

32.

Restrictions on withdrawal of shares and deposits.

Borrowing

33.

Power to borrow.

34.

Charges on assets of a credit union.

Loans

35.

Making of loans.

36.

Approval of loans.

37.

Appeal against non-approval of loan.

37A.

Member to receive written notice of loan approval.

37B.

Credit agreement in respect of loans exceeding €200.

37C.

Contents of credit agreements.

37D.

Notice of important information to be included in credit agreements.

37E.

Definition and calculation of ‘APR’ for the purposes of sections 37C and 37D.

37F.

Regulations for the purposes of sections 37A-37D.

38.

Interest on loans.

Other transactions

39.

Promissory notes and bills of exchange.

40.

Contracts.

41.

Acquisition, holding and disposal of land.

42.

Receipt for repayment of secured debt.

Investments etc.

43.

Investments.

44.

Special fund for social, cultural etc. purposes.

45.

Statutory reserve.

46.

Savings protection scheme.

47.

Insurance against fraud of officers etc.

Provision of additional services to members

48.

Power to provide additional services.

49.

The Registrar's approval of provision of additional services.

50.

Supplementary provisions as to Registrar’s functions.

51.

Requirements applicable to credit unions providing additional services.

52.

Appeal against certain decisions of Bank.

PART IV

Management of Credit Unions

Directors

53.

Board of directors.

54.

Directors: procedural provisions.

55.

Functions of board of directors.

55A.

Chair of board of directors, etc.

56.

Removal of director from office.

56A.

Board Committees.

56B.

Nomination Committee.

57.

Directors: supplemental provisions.

Supervisory Committee

58.

Supervisory Committee.

59.

Supervisory Committee: procedural provisions.

60.

Functions of Supervisory Committee.

61.

Supervisory Committee: removal from office.

62.

Supervisory Committee: supplemental provisions.

Officers

63.

Officers: principal posts.

63A.

Manager of credit union.

64.

Functions of treasurer.

65.

Credit officer and credit control officer.

66.

Officers: suspension and removal by Supervisory Committee.

General governance requirements

66A.

Governance arrangements in credit unions.

66B.

Remuneration policies and practices.

66C.

Reporting to Bank.

General provisions

67.

Credit, credit control and membership committees.

68.

Limitation of remuneration.

69.

Conflicts of interest.

70.

Required signatories etc.

71.

Confidentiality of information.

72.

Persons disqualified from acting.

73.

Giving of security by officers etc.

74.

Duty to account.

75.

Register of members and officers.

76.

Inspection of books.

Additional requirements for credit unions

76A.

Strategic plan.

76B.

Risk management systems and systems and control.

76C.

Risk management officer.

76D.

Compliance officer.

76E.

Operational risk.

76F.

Records management.

76G.

Information systems.

76H.

Management information.

76I.

Business continuity plan.

76J.

Outsourcing.

76K.

Internal audit.

PART IVA

Board Oversight Committee

76L.

Board oversight committee.

76M.

Functions of board oversight committee.

76N.

Election of board oversight committee, etc.

76O.

Board oversight committee: procedural provisions.

76P.

Board oversight committee: term of office and retirement.

76Q.

Board oversight committee: removal from office.

76R.

Board oversight committee: supplementary provision.

PART V

Meetings, Resolutions etc.

77.

The organisation meeting.

78.

The annual general meeting.

79.

Special general meetings.

80.

Notice of general meetings.

81.

General meetings: adjournment, quorum and minutes.

82.

Supplementing provisions as to general meetings.

83.

Special resolutions.

PART VI

Control and Supervision of Credit Unions by the Bank

General

84.

Functions of the Bank.

84A.

Power of Bank to make regulations.

85.

Assets and liabilities ratios and structures.

85A.

Liquidity.

85B.

Supplemental provisions to sections 85 and 85A.

86.

Control of advertising.

Regulatory directions and prohibition orders

87.

Power of Registrar to give regulatory directions.

88.

Procedural provisions relating to regulatory directions.

89.

Power of Court to prohibit continuance of certain contraventions.

Inspections and information

90.

Inspection of books and documents of credit union.

91.

Notice to furnish books, information etc.

92.

Investigations and calling of meetings.

93.

Provisions supplementary to investigations under section 92 .

94.

Inspector's report and proceedings thereon.

Supervisory powers

95.

Registrar's power to appoint person as director of a credit union.

95A.

Bank’s power to require appointment of additional director of credit union.

96.

Removal or suspension of directors and members of Supervisory Committee.

97.

Cancellation of registration.

98.

Suspension of registration.

99.

Appeals against cancellation or suspension.

Administrative Provisions

100.

Public file of a credit union.

101.

Fees.

102.

Classification of information.

103.

Delivery to the Registrar of documents in legible form.

104.

Delivery to the Registrar of documents otherwise than in legible form.

105.

Exercise of Registrar's functions.

106.

Annual report by Registrar.

PART VII

Accounts and Audit

107.

Financial year of a credit union.

108.

Accounting records etc.

109.

Systems of control and safe custody.

110.

Accounting principles.

111.

Annual accounts.

112.

Balance sheet to be available to members.

113.

Obligation to appoint auditors.

114.

Qualification for appointment as auditor.

115.

Eligibility of auditor for re-election.

116.

Removal of auditor by Registrar.

117.

Resolutions relating to appointment and removal of auditors.

118.

Resignation of auditors.

119.

Requisitioning of general meeting and circulation of statement by resigning auditor.

120.

Auditor's report, right of access and to be heard.

121.

Regulations relating to accounts and audit.

122.

Auditor's duty to report to Registrar.

123.

Penalty for false statements etc. to auditors.

124.

Annual returns.

PART VIII

Disputes and Complaints

125.

Settlement of disputes.

126.

Arbitration and procedural matters.

127.

Investigation of complaints.

PART IX

Amalgamations and Transfers of Engagements

128.

Amalgamation of credit unions.

129.

Transfer of engagements between credit unions.

130.

Statement for members relating to proposed amalgamation or transfer of engagements.

131.

Confirmation of amalgamation or transfer.

132.

Distribution to members.

PART X

Winding up

133.

Petition of Registrar to wind up.

134.

Winding up under the Companies Acts.

135.

Winding up by instrument of dissolution.

136.

Restriction on dissolution or cancellation of registration.

PART XI

Appointment of Credit Union Administrator

137.

Administration orders.

138.

Provisional administrators.

139.

Effect of administration.

140.

Termination of administration.

141.

Procedural matters.

PART XII

Appointment of Examiner

142.

Power of the Court to appoint examiner.

143.

Petition for protection of the Court.

144.

Powers of the Circuit Court.

145.

The independent accountant's report.

146.

Interim protection pending report.

147.

Effect of petition to appoint examiner on creditors and others.

148.

Effect on receiver or provisional liquidator of order appointing examiner.

149.

Powers of an examiner.

150.

Production of documents and evidence.

151.

Further powers of the Court.

152.

Incurring of certain liabilities by examiner.

153.

Power to deal with charged property etc.

154.

Notification of appointment of examiner.

155.

General provisions as to examiners.

156.

Hearing relating to missing property etc.

157.

Duties of examiner.

158.

Contents of examiner's report under section 157 .

159.

Repudiation of certain contracts.

160.

Appointment of creditors' committee.

161.

Proposals for compromise or scheme of arrangement.

162.

Consideration by members and creditors of proposals.

163.

Consideration of proposals by the Court.

164.

Confirmation or otherwise of proposals by the Court.

165.

Ending of protection.

166.

Revocation of confirmation on grounds of fraud.

167.

Disqualification to act as examiner.

168.

Remuneration, costs and expenses of examiners.

169.

Publicity.

170.

Hearing of proceedings otherwise than in public.

PART XIII

Offences and Civil Proceedings

171.

Offences: general provisions.

172.

Offences by officers etc.

173.

Fraud or misappropriation.

174.

Falsification of documents and other records.

175.

Furnishing false information etc.

176.

Recovery of costs and expenses.

177.

Liability of officer etc.

178.

Power of court to grant relief to officer etc.

179.

Judgments against a credit union.

PART XIV

Miscellaneous and General

180.

Credit Union Advisory Committee.

181.

Consultation.

182.

General regulations.

182A.

General regulations by Bank.

183.

Regulations to remove difficulties.

184.

Certain enactments not to apply to credit unions etc.

185.

Exemptions from stamp duty.

186.

Records and registers.

187.

Form, deposit and evidence of documents.

188.

Service of notices etc.

189.

Transitional provisions.

FIRST SCHEDULE

Matters to be Provided for in Rules of Credit Union

SECOND SCHEDULE

Form of Receipt

THIRD SCHEDULE

Credit Committee, Credit Control Committee and Membership Committee

FOURTH SCHEDULE

Supplementary Provisions in Relation to Regulatory Directions

FIFTH SCHEDULE

Supplementary Provisions as to Removal or Suspension by the Registrar of Directors and Members of Supervisory Committee


Acts Referred to

Arbitration Acts, 1954 and 1980

Bills of Sale (Ireland) Acts, 1879 and 1883

Building Societies Act, 1989

1989, No. 17

Central Bank Act, 1971

1971, No. 24

Central Bank Acts, 1942 to 1997

Companies Act, 1963

1963, No. 33

Companies Act, 1990

1990, No. 33

Companies Acts, 1963 to 1990

Consumer Credit Act, 1995

1995, No. 24

Credit Union Act, 1966

1966, No. 19

Friendly Societies Acts, 1896 to 1977

Industrial and Provident Societies (Amendment) Act, 1978

1978, No. 23

Industrial and Provident Societies Acts, 1893 to 1978

Petty Sessions (Ireland) Act, 1851

14 & 15 Vict. c.93

Powers of Attorney Act, 1996

1996, No. 12

Statute of Limitations, 1957

1957, No. 6

Statutory Instruments Act, 1947

1947, No. 44


Number 15 of 1997


CREDIT UNION ACT 1997

REVISED

Updated to 21 September 2018


AN ACT TO MAKE NEW PROVISION IN RELATION TO CREDIT UNIONS AND FOR CONNECTED PURPOSES. [3 rd May, 1997]

BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

Annotations:

Modifications (not altering text):

C1

Application of Act restricted (1.03.2013) by Personal Insolvency Act 2012 (44/2012), s. 135(2), S.I. No. 63 of 2013.

Set-off to be applied.

135.— ...

(2) Notwithstanding any provision of the Credit Union Act 1997, savings (within the meaning of that Act) of a debtor in a credit union shall be subject to set off in accordance with subsection (1) against a debt owed by the debtor to the credit union.

C2

Application of Act restricted (28.10.2011) by Central Bank and Credit Institutions (Resolution) Act 2011 (27/2011), s. 49(7)(a), S.I. No. 548 of 2011, and as substituted (15.07.2015) by European Union (Bank Recovery and Resolution) Regulations 2015 (S.I. No. 289 of 2015), reg. 187(c)(iv), in force as per reg. 1(2).

Effect of transfer order — general.

49.— ...

(7) Subsection (6) has effect notwithstanding anything in—

[( a) the Credit Union Act 1997, or ]

...

C3

Application of Act restricted (28.10.2011) by Central Bank and Credit Institutions (Resolution) Act 2011 (27/2011), s. 69(6)(a), S.I. No. 548 of 2011, and as amended by European Union (Bank Recovery and Resolution) Regulations 2015 (S.I. No. 289 of 2015), reg. 187(d), in force as per reg. 1(2).

Effect of appointment of special manager.

69.— ...

(6) A special management order has effect notwithstanding anything in—

(a) the Companies Acts, [... ] the Credit Union Act 1997 or the Central Bank Acts 1942 to 2011,

...

Editorial Notes:

E1

Responsibilities and powers for managing the performance and exercise of functions and powers of Central Bank under Act delegated to Registrar of Credit Unions by Central Bank Act (22/1942), s. 33AA, as inserted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 26, S.I. No. 160 of 2003.

E2

Act included within definition of “designated enactments” for purposes of Central Bank Act 1942 (22/1942), s. 2(1) and sch. 2 pt. 1 item 25, as inserted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 31 and as substituted (1.10.2010) by Central Bank Reform Act 2010 (23/2010), s. 14(1) and sch. 1 pt. 1 items 6 and 82, S.I. No. 469 of 2010.

E3

Previous affecting provision: power to designate powers of members to Minister prescribed (21.12.2010) by Credit Institutions (Stabilisation) Act 2010 (36/2010), s. 47(1), S.I. No. 623 2010; reference to Act deleted (28.10.2011) by Central Bank and Credit Institutions (Resolution) Act 2011 (27/2011), s. 110(5) and sch. 2 pt. 5 item 51, S.I. No. 548 of 2011.

E4

Previous affecting provision: application of Act restricted (21.12.2010) by Credit Institutions (Stabilisation) Act 2010 (36/2010), s. 53(a), S.I. No. 623 2010; reference to Act deleted (28.10.2011) by Central Bank and Credit Institutions (Resolution) Act 2011 (27/2011), s. 110(5) and sch. 2 pt. 5 item 56, S.I. No. 548 of 2011.

E5

Provision for the continuance in force of certain existing regulations made by Minister for Enterprise, Trade and Employment under Act, capable of being continued in force by the Minister for Finance, made (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 36 and sch. 3 para. 27, S.I. No. 160 of 2003.

PART I

Preliminary and General

Short title and commencement.

1

1. (1) This Act may be cited as the Credit Union Act, 1997.

(2) This Act shall come into operation on such day or days as may be fixed by order made by the Minister; and different days may be so fixed for different provisions and for different purposes.

(3) Without prejudice to the generality of subsection (2), an order under that subsection may make different provision in relation to credit unions registered before the passing of this Act as compared with those registered later.

Annotations:

Editorial Notes:

E6

Power pursuant to section exercised (1.08.2001) by Credit Union Act, 1997 (Commencement) Order 2001 (S.I. No. 378 of 2001).

2.      The 1st day of August, 2001, is fixed as the day on which sections 46 to 52 of the Credit Union Act, 1997 (No. 15 of 1997), shall come into operation.

E7

Power pursuant to section exercised (1.10.1997) by Credit Union Act, 1997 (Commencement) Order 1997 (S.I. No. 403 of 1997).

2. The 1st day of October, 1997, is hereby fixed as the day on which

( a )Parts I and II,

( b )Part III (other than sections 46 to 52)),

( c )Part IV (other than section 68 (1)( c)),

( d )Parts V and VI,

( e )Part VII (other than sections 120 (5) and 122 (1)( f)),

( f )Parts VIII to XIV, and

( g )the First, Second, Third, Fourth and Fifth Schedules, of the Credit Union Act, 1997 (No. 15 of 1997), shall come into operation.

Interpretation.

2

2. F1 [ (1) In the Credit Union Acts 1997 to 2012

Act of 1966 means the Credit Union Act 1966 ;

Advisory Committee means the committee established under section 180;

amendment , in relation to the rules of a credit union, includes a new rule, and a resolution rescinding a rule, of the credit union;

annual accounts has the meaning given by section 111(6) ;

annual general meeting has the meaning given by section 78(1) ;

annual return means the annual return which a credit union is required by section 124 to send to the Bank;

Bank means the Central Bank of Ireland;

board of directors means the body which has general control, direction and management of a credit union and to which section 53 relates;

board oversight committee has the meaning given by section 76L ;

books and documents includes accounts and records made in any manner, and books or documents shall be construed accordingly;

business continuity and business continuity plan have the meanings given to them, respectively, by section 76I ;

chair has the meaning given by section 55A(2) ;

civil partner has the same meaning as it has in the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 ;

cohabitant has the same meaning as it has in the Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 ;

common bond means a common bond falling within section 6(3) ;

compliance officer has the meaning given by section 76D ;

contravention includes failure to comply;

Court means the High Court;

credit institution means

( a ) a recognised bank within the meaning of the Central Bank Acts 1942 to 2011,

( b ) a trustee savings bank,

( c ) the Post Office Savings Bank, or

( d ) a building society within the meaning of the Building Societies Act 1989 ;

credit union means a society registered as such under this Act, including a society deemed to be so registered by virtue of section 5(3) ;

debentures means any debentures, debenture stock or bonds of a credit union, whether constituting a charge on the assets of the credit union or not;

financial services legislation , where applicable to credit unions acting under any authorisation from the Bank provided for by law, means

( a ) the designated enactments within the meaning of section 2 of the Central Bank Act 1942 ,

( b ) the designated statutory instruments within the meaning of section 2 of the Central Bank Act 1942 , and

( c ) the Central Bank Acts 1942 to 2011 together with the statutory instruments made under those Acts;

general meeting means an annual general meeting or a special general meeting;

internal audit charter has the meaning given by section 76K(2) ;

internal audit function has the meaning given by section 76K(1) ;

internal audit plan has the meaning given by section 76K(3) ;

manager , in relation to a credit union, means the individual appointed to the role of manager of the credit union under section 63A ;

management team has the meaning given by section 55(1)(i) ;

meeting , includes, where the registered rules of a credit union so allow, a meeting of delegates appointed by members;

member of the family , in relation to any person, means that person s father, mother, grandfather, grandmother, father-in-law, mother-in-law, spouse or civil partner, cohabitant, son, daughter, grandson, granddaughter, brother, sister, half-brother, half-sister, uncle, aunt, nephew, niece, first cousin, step-son, step-daughter, step-brother, step-sister, son-in-law, daughter-in-law, brother-in-law or sister-in-law;

Minister means the Minister for Finance;

nomination committee has the meaning given by section 56B(1) ;

non-qualifying member , in relation to a credit union, has the meaning given by section 17(4) ;

officer , in relation to a credit union, includes

( a ) the chair, the secretary or any other member of the board of directors, a member of a principal Committee, a member of the board oversight committee, risk management officer, compliance officer, credit officer or credit control officer of the credit union,

( b ) an employee of the credit union to whom paragraph (a) does not apply, and

( c ) a voluntary assistant of the credit union,

but does not include an auditor appointed by the credit union in accordance with the requirements of this Act;

operational risk has the meaning given by section 76E(1) ;

organisation meeting has the meaning given by section 77(1) ;

pass book includes any type of written statement of account;

persons claiming through a member includes the executors or administrators and assignees of a member and, where nomination is allowed, the member s nominee;

prescribe means

( a ) in relation to the Minister, prescribed by regulations made by the Minister under section 182 , and

( b ) in relation to the Bank, prescribed by regulations made by the Bank under section 182A ;

principal Committee , in relation to a credit union, means a credit committee, credit control committee or membership committee;

register means the register maintained under section 8(5) ;

registered means for the time being entered in the register and registration shall be construed accordingly;

regulatory directions has the meaning given by section 87(3) ;

restructuring proposal has the meaning given by section 45 (1) of the Credit Union and Co-operation with Overseas Regulators Act 2012;

risk management officer has the meaning given by section 76C(1) ;

risk management system has the meaning given by section 76B(1) ;

savings , in relation to a credit union, has the meaning given by section 27(1) ;

share , in relation to a credit union, means each sum of one euro standing to the credit of a member of that credit union in respect of shares in the register of members required by this Act to be kept by that credit union;

special general meeting shall be construed in accordance with section 79 ;

special resolution means a resolution which is passed by a majority of not less than three quarters of such members of a credit union present and voting and who are for the time being entitled to vote in person at any general meeting of which notice, specifying the intention to propose the resolution, has been duly given according to the rules of the credit union;

strategic objectives has the meaning given by section 76A(1) ;

strategic plan has the meaning given by section 76A(1) ;

voluntary assistant , in relation to a credit union, means a member of the credit union who, although not a remunerated employee of the credit union, is engaged in any way in the operation of the credit union. ]

(2) Any reference in this Act to a member present at a meeting means, in the case of a member which is not a natural person, being represented at the meeting by a representative, as mentioned in section 82 (4) .

(3) In this Act a reference to a Part, section or Schedule is to a Part, section or Schedule of or to this Act, unless it is indicated that reference to some other enactment is intended.

(4) In this Act a reference to a subsection, paragraph or subparagraph is to the subsection, paragraph or subparagraph of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended.

(5) In this Act a reference to an enactment includes a reference to that enactment as amended by or under any enactment, including this Act.

Annotations:

Amendments:

F1

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 6, S.I. No. 393 of 2013.

Editorial Notes:

E8

Previous affecting provision: subs. (1) amended (1.10.2010) by Central Bank Reform Act 2010 (23/2010), s. 15(7) and sch. 2 pt. 7, S.I. No. 469 of 2010; subsection substituted as per F-note above.

E9

Previous affecting provision: subs. (1) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 1, S.I. No. 160 of 2003; subsection substituted as per F-note above.

E10

Previous affecting provision: subs. (1) amended (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6, commenced as per section; subsection substituted as per F-note above.

Orders and regulations.

3

3. (1) Any power under this Act to make an order includes power to amend or revoke an order made in the exercise of that power.

(2) Every order or regulation made under this Act, other than an order under section 1 (2) , shall be laid before each House of the Oireachtas as soon as practicable after it is made; and, if a resolution annulling the order or regulation is passed by either such House within the next twenty-one days on which that House has sat after the order or regulation is laid before it, the order or regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

(3) Except in so far as any provision of this Act otherwise provides, any power conferred by this Act on the F2 [ Bank ] to give directions shall be exerciseable by rules and for the purposes of section 2 of the Statutory Instruments Act, 1947, any rules made by the F2 [ Bank ] under this Act shall be taken to be of a character which affects a class of the public.

(4) Any order, regulation, direction or rules made under this Act—

( a) may contain such consequential, supplementary and ancillary provisions as the Minister or, as the case may be, the F2 [ Bank ] considers necessary or expedient; and

( b) may make different provision for different cases or descriptions of cases.

Annotations:

Amendments:

F2

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 2, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Modifications (not altering text):

C4

Application of subs. (2) extended (19.12.2012) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 2(2), S.I. No. 557 of 2012.

Commencement.

2.— ...

(2) Notwithstanding the commencement of the Principal Act, the provisions of section 3(2) of the Principal Act relating to an order under section 1(2) of that Act apply to an order made under this section.

4

F3 [ Expenses incurred by the Minister.

4. Expenses incurred by the Minister in administering this Act are payable out of money provided by the Oireachtas. ]

Annotations:

Amendments:

F3

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 3, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3.

Repeals and transition from the former law.

5

5. (1) The following enactments are hereby repealed—

( a) the Act of 1966; and

( b) Part III of the Industrial and Provident Societies (Amendment) Act, 1978.

(2) After the commencement of this subsection, a society may not become registered as a credit union except under this Act.

(3) A society which, immediately before the commencement of this subsection, was registered as a credit union under the Industrial and Provident Societies Acts, 1893 to 1978, shall, at that commencement, be deemed to be registered as a credit union under this Act and, accordingly—

( a) after that commencement, no provision of those Acts shall apply to a credit union; and

( b) except in so far as the rules of a credit union which is deemed to be so registered are contrary to any provision of this Act, those rules, as in existence immediately before the commencement of this subsection, shall be regarded as its registered rules at that commencement.

(4) Subject to subsection (5), if at any time the F4 [ Bank ] is satisfied that a society registered under the Industrial and Provident Societies Acts, 1893 to 1978, or the Friendly Societies Acts, 1896 to 1977, is carrying on its affairs in such a way that its objects are wholly or substantially those of a credit union, F4 [ it ] may, notwithstanding anything in those Acts, direct the society, within a period specified in the direction—

( a) to cease all its activities or some activities specified in the direction; or

( b) to wind up its affairs; or

( c) to register by virtue of this Act as a credit union;

and a society to which such a direction is given shall comply with it within the specified period.

(5) Subsection (4) does not apply to a society—

( a) which was registered under the Industrial and Provident Societies Acts, 1893 to 1936, between 24th January 1962 and 31st August 1966; and

( b) the objects of which have at all times been wholly or substantially those of a credit union.

(6) After the commencement of this subsection, a society the objects or proposed objects of which are wholly or substantially those specified in section 6 (2) may not be registered under the Industrial and Provident Societies Acts, 1893 to 1978.

(7) Section 3 (3) shall not apply to directions under subsection (4).

Annotations:

Amendments:

F4

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 4, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Editorial Notes:

E11

Previous affecting provisions: Industrial and Provident Societies (Financial Limits) Regulations 1985 (S.I. No. 392 of 1985) and Industrial and Provident Societies (Financial Limits) (Amendment) Regulations 1990 (S.I. No. 246 of 1990) continued in effect and deemed to have been continued in effect despite repeal of Credit Union Act 1966, s. 35(1)(h) until passing of Investment Funds, Companies and Miscellaneous Provisions Act 2005 (29.06.2005) by Investment Funds, Companies and Miscellaneous Provisions Act 2005 (12/2005), s. 86, commenced on enactment.

PART II

Registration and Membership

Registration

Conditions for registration as a credit union.

6

6. (1) A society may be registered under this Act as a credit union if the F5 [ Bank ] is satisfied that each of the following conditions is fulfilled—

( a) the society is formed for the objects specified in paragraphs (a) to (c) of subsection (2) and for no other purposes beyond those specified in paragraphs (d) to (g) of that subsection;

( b) admission to membership of the society is restricted to persons each of whom has, in relation to all the other members, at least one of the common bonds specified in subsection (3);

( c) it has at least 15 members who are of full age;

( d) its rules comply with section 13 ;

( e) the place which under those rules is, or is to be, the society's registered office is in the State;

( f) F6 [ ]

( g) it has in force (or will have in force if registered) such a policy of insurance as is required by section 47 .

(2) The objects referred to in subsection (1)(a) are—

( a) the promotion of thrift among its members by the accumulation of their savings;

( b) the creation of sources of credit for the mutual benefit of its members at a fair and reasonable rate of interest;

( c) the use and control of members' savings for their mutual benefit;

( d) the training and education of its members in the wise use of money;

( e) the education of its members in their economic, social and cultural well-being as members of the community;

( f) the improvement of the well-being and spirit of the members' community; and

( g) subject to section 48 , the provision to its members of such additional services as are for their mutual benefit.

(3) The common bonds referred to in subsection (1)(b) are—

( a) following a particular occupation;

( b) residing or being employed in a particular locality;

( c) being employed by a particular employer or having retired from employment with a particular employer;

( d) being a member of a bona fide organisation or being otherwise associated with other members of the society for a purpose other than that of forming a society to be registered as a credit union;

( e) any other common bond approved by the F5 [ Bank ].

(4) In ascertaining whether a common bond exists between the members of a society, the F5 [ Bank ]

( a) shall have regard to the qualifications which are stated in the rules to be required for admission to membership of the society, and

( b) may, if F5 [ it ] considers it proper in the circumstances of the case, treat the fact that admission to membership is restricted as mentioned in subsection (1)(b) as sufficient evidence of the existence of a common bond.

(5) For the purposes of this Act, if the rules of a credit union so provide, a person shall be treated as having the qualification required for admission to membership stated in those rules if he is a member of the same household as, and is a member of the family of, another person who is a member of the credit union and who has a direct common bond with those other members.

Annotations:

Amendments:

F5

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 5, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F6

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 1, S.I. No. 393 of 2013.

6A

F7 [ Supplemental provisions relating to registration, etc., under section 6 of Principal Act.

6A. (1) The Bank may impose such conditions, if any, as the Bank considers to be necessary to protect, with effect from registration under this Part, the interests of the members of the society seeking registration and any such conditions shall be a condition for registration as a credit union.

(2) The conditions imposed by the Bank under subsection (1) may include requiring a credit union

( a ) to notify the Bank of any events of such significance that could materially affect the credit union including any change to the strategic plan of the credit union;

( b ) to operate a more limited business model agreed with the Bank;

( c ) to cause to be undertaken an independent review of the credit union s business within 12 months in order to ensure that the credit union is complying with all legal and regulatory requirements.

(3) Any of the conditions of registration may be amended or revoked by the Bank if, in the opinion of the Bank

( a ) the amendment or revocation is necessary to protect the interests of the credit union s members, or

( b ) the conditions concerned have become spent or obsolete and should be revoked.

(4) Whenever the Bank proposes to impose a condition in relation to a registration or to amend the conditions of a registration

( a ) it shall notify in writing the society seeking registration under this Part or the credit union concerned, as the case may be

(i) that it intends to impose one or more than one condition in relation to the registration or to amend the existing conditions of the registration imposed under this section, as the case may be, and of its reasons for so doing, and

(ii) that the society or credit union concerned, as the case may be, may, within 15 working days after the date of the giving of the notification, make representations in writing to the Bank in relation to the imposition or amendment, as the case may be, and shall specify in the notification, the condition or the amendment, as the case may be,

and

( b ) the society or credit union concerned, as the case may be, may make such representations to the Bank within the time referred to in paragraph (a)(ii) .

(5) Before deciding to impose conditions of registration, or an amendment of conditions of the registration, under this section, as the case may be, the Bank shall consider any representations duly made to it under subsection (4)(b) and, after so considering, the Bank may

( a ) decide to impose the conditions of registration, or the amendment of the conditions of the registration, under this section, as the case may be,

( b ) decide to impose the conditions or amend the conditions of the registration under this section, as the case may be, that differ from those specified in the notification concerned, but only if the difference results in the conditions concerned being no more onerous than would be the case had the Bank decided to impose the conditions or amend the conditions of the registration, as the case may be, in accordance with the notification concerned, or

( c ) without prejudice to subsections (1) to (3) , decide not to impose the conditions or not to amend the conditions of the registration. ]

Annotations:

Amendments:

F7

Inserted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 7, S.I. No. 280 of 2013.

Editorial Notes:

E12

The section title is taken from the amending section in the absence of one included in the amendment.

Application for registration as a credit union.

7

7. (1) An application for the registration of a society as a credit union shall be made to the F8 [ Bank ] and shall be signed by 15 members of the society, all of whom have the same common bond and one of whom shall be the secretary.

(2) An application under subsection (1) shall be accompanied by two printed copies of the society's rules.

Annotations:

Amendments:

F8

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 6, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Acknowledgement or refusal of registration.

8

8. (1) If the F9 [ Bank ] is satisfied that a society which has made an application for registration as a credit union has complied with the provisions of this Act as to such registration, the F9 [ Bank ] shall issue to the society, as a credit union, an acknowledgement of registration assigning it a registered number.

(2) Unless the contrary is shown, an acknowledgement of registration issued under subsection (1) shall be sufficient evidence that the society concerned is registered as a credit union.

F10 [ (3) If the Bank refuses to register as a credit union a society that has made an application for registration, it shall, by notice in writing, inform the society of the refusal. The notice must include a statement setting out the grounds for the refusal. ]

F10 [ (4) A decision of the Bank refusing to register a society as a credit union is an appealable decision for the purposes of Part VIIA of the Central Bank Act 1942 . ]

(5) The F9 [ Bank ] shall enter the name of every credit union in a register maintained for the purposes of this Act (being a continuation of the register kept for the purposes of the Act of 1966).

Annotations:

Amendments:

F9

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 7, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F10

Substituted (1.08 2004) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 10(2) and sch. 1 pt. 7 item 1, S.I. No. 455 of 2004.

Editorial Notes:

E13

Previous affecting provision: subss. (3) and (4) amended by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 7, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; subsections substituted as per F-note above.

Effect of registration.

9

9. (1) By virtue of its registration, a credit union shall be a body corporate known by its registered name (by which it may sue and be sued) with perpetual succession, a common seal and limited liability.

(2) The registration of a credit union shall vest in the credit union all property for the time being vested in any person in trust for the credit union and all proceedings pending by or against the trustees of the credit union may be brought or continued by or against the credit union in its registered name.

(3) Legal proceedings in respect of any contract or other transaction—

( a) entered into by an unincorporated society before the date on which it becomes a credit union, or

( b) purporting to be entered into by such a society or by any person on its behalf before that date,

may, on or after that date, be brought by or against the credit union, subject to the Statute of Limitations, 1957, as if it had been registered as a credit union at the date of the contract or other transaction.

Registered name.

10

10. (1) The words “ credit union” or “ comhar creidmheasa” shall be included in the name of every credit union.

(2) The name of every credit union shall end with the word “ Limited” or “ Teoranta” which may be abbreviated to “Ltd.” or “Teo.” respectively.

(3) A credit union shall not use any name or title other than its registered name.

(4) A society shall not be registered—

( a) under a name which includes the word “ bank”, “ banker” or “ banking” or any other word which is a translation, variant or derivative of any of those words, or

( b) under any other name which, in the opinion of the F11 [ Bank ], is undesirable.

(5) A society shall not be registered under a name identical with that of an existing credit union or so nearly resembling such a name as to be likely to mislead members of the public as to its identity.

(6) As soon as practicable, every credit union shall cause its registered name to be painted or affixed, and to be kept painted or affixed, in a conspicuous position and in letters easily legible, on the outside of its registered office and every other office or place in which the business of the credit union is carried on, and shall have that name engraved in legible characters on its seal and set out in legible characters—

( a) in all notices, advertisements and other official publications of the credit union;

( b) in all business letters of the credit union;

( c) in all bills of exchange, promissory notes, endorsements, cheques, orders for money or goods and other instruments purporting to be signed by or on behalf of the credit union; and

( d) in all bills, invoices, receipts, and letters of credit of the credit union.

F12 [ (7) Notwithstanding subsection (6) a credit union which is a sub-office of a registered credit union may cause its name, along with the registered name of the credit union, to be painted or affixed, and to be kept painted or affixed, in a conspicuous position and in letters easily legible, on the outside of its office. ]

Annotations:

Amendments:

F11

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 8, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F12

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 2, S.I. No. 393 of 2013.

Change of registered name.

11

11. (1) A credit union may not change its name except in accordance with this section.

(2) A credit union may change its name—

( a) by a resolution for the purpose passed at a general meeting of the credit union after the giving of such notice as is required by the rules of the credit union for such a resolution or, if the rules do not make special provision as to notice of such resolution, after the giving of such notice as is required by the rules for a resolution to amend the rules; and

( b) with the prior approval in writing of the F13 [ Bank ].

F14 [ (3) A decision of the Bank declining to give its approval under subsection (2)( b ) is an appealable decision for the purposes of Part VIIA of the Central Bank Act 1942 . ]

(4) A change in the name of a credit union shall not affect any right or obligation of the credit union, or of any member thereof, and any pending legal proceedings may be continued by or against the credit union notwithstanding its new name.

(5) Where, in the opinion of the F13 [ Bank ], a credit union is (through inadvertence or otherwise) for the time being registered under a name which is undesirable, the F13 [ Bank ]

( a) within one year of its being registered under that name, or

( b) in the case of a society deemed to be registered under this Act by virtue of section 5 (3) , within one year from the commencement of this section,

F15 [ may decide to direct and direct the credit union to change its name to a name approved by the Bank ].

(6) A credit union shall comply with a direction given to it under subsection (5).

(7) Where a credit union changes its name under this section, the F13 [ Bank ]

( a) shall enter the new name in the register in place of the former registered name; and

( b) shall issue to the credit union an acknowledgement of registration, altered to meet the circumstances of the case.

(8) Section 3 (3) shall not apply to a direction under subsection (5).

Annotations:

Amendments:

F13

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 9, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F14

Substituted (1.08.2004) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 10(2) and sch. 1 part 7 item 2, S.I. No. 455 of 2004.

F15

Substituted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 3, S.I. No. 280 of 2013.

Editorial Notes:

E14

Previous affecting provision: subss. (3) and (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 9, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; subsection substituted as per F-note above.

Protection of use of seal and registered name of credit union.

12

12. (1) The seal of a credit union shall be used only under the authority of a resolution of the board of directors and shall be attested by the signatures of two directors of the credit union and the countersignature of the secretary for the time being.

(2) Any officer of a credit union, or any other person acting on a credit union's behalf, who—

( a) uses any seal purporting to be a seal of the credit union which does not have the credit union's registered name engraved on it in legible characters, or

( b) issues or authorises the issue of any document such as is mentioned in paragraph (a), paragraph (b) or paragraph (d) of subsection (6) of section 10 in which that name is not set out in legible characters, or

( c) signs or authorises to be signed on behalf of the credit union any document such as is mentioned in paragraph (c) of that subsection in which that name is not so set out,

shall be guilty of an offence.

(3) Subject to subsection (4), any person, other than a credit union, who—

( a) uses in reference to himself, a name, title or descriptive expression containing the words “ credit union ” or “ comhar creidmheasa” or any cognate term or any derivative of those words, or

( b) represents himself as being a credit union,

shall be guilty of an offence.

(4) Subsection (3) does not apply to—

( a) the use by an officer of a title or descriptive expression indicating his office or post with the credit union; or

( b) the use of the term “Irish League of Credit Unions” by the unincorporated association having that name immediately before the passing of this Act; or

( c) the use with reference to an association or group of credit unions of a name which has been approved in writing by the F16 [ Bank ].

Annotations:

Amendments:

F16

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 10, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Rules

Rules.

13

13. (1) The rules of a credit union shall be in such form as the F17 [ Bank ] may determine and shall contain—

( a) provisions with respect to the matters in the First Schedule ; and

( b) such additional provisions as the F17 [ Bank ] may determine, after consultation with the Advisory Committee and such other bodies as appear to F17 [ it ] to be expert or knowledgeable in matters relating to credit unions.

(2) The rules of a credit union may specify the form of any instrument necessary for carrying the purposes of the credit union into effect.

(3) An acknowledgement of registration issued to a credit union under this Part shall constitute an acknowledgement, and, unless the contrary is proved, be sufficient evidence of the registration of the rules of that credit union in force at the date of the acknowledgement of the registration of the credit union.

Annotations:

Amendments:

F17

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 11, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Amendment of registered rules.

14

14. (1) The rules of a credit union shall not be amended except by a resolution passed by not less than two-thirds of the members of the credit union present and voting at an annual general meeting or at a special general meeting called for the purpose of considering a resolution proposing an amendment of the rules.

(2) An amendment of the registered rules of a credit union shall not be valid until the amendment has been registered under this Act, for which purpose two copies of the amendment, signed by four members, one of whom shall be the secretary and another a director, shall be sent to the F18 [ Bank ].

(3) Subsection (2) shall not apply to a change in the name of a credit union, but, where a change in the name of a credit union is made in accordance with section 11 , the change in the credit union’s name shall be registered by the F18 [ Bank ] as an amendment of the credit union's rules.

F19 [ (3A) Before sending a copy of the amended rules to the Bank under subsection (2) the credit union is required to satisfy itself that the amendment is not contrary to the financial services legislation. ]

F20 [ (4) On being satisfied that an amendment of a credit union s rules sent to it under subsection (2) is not contrary to the financial services legislation, the Bank shall issue to the credit union, within 3 months of its receipt of the amendment, an acknowledgement of registration which, unless the contrary is proved, shall be sufficient evidence that the amendment is duly registered.

(5) If the Bank is not satisfied that an amendment of a credit union s rules sent to it under subsection (2) is not contrary to the financial services legislation, it shall refuse to register the amendment, in which case it shall give the credit union a notice of its refusal to register the amendment. The notice shall include a statement setting out the grounds for the refusal. ]

F21 [ (5A) A decision of the Bank refusing to register an amendment of a credit union s rules under subsection (5) is an appealable decision for the purposes of Part VIIA of the Central Bank Act 1942 . ]

(6) Notwithstanding anything in the rules of a credit union, the board of directors may, by resolution passed during the transitional period, make such amendments of the rules of the credit union as may be consequential on the provisions of this Act.

(7) For the purposes of subsection (6), the transitional period is the period of one year from the commencement of this section or such longer period as may be determined by the F18 [ Bank ].

(8) Notwithstanding anything in subsection (4), after the expiry of one year from the commencement of this section, the F18 [ Bank ] shall not be required to register any amendment of a credit union's rules unless such consequential amendments of the registered rules as are mentioned in subsection (6) either—

( a) have been made before the F18 [ Bank ] receives the amendment; or

( b) are to be effected by the amendment.

Annotations:

Amendments:

F18

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 12, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F19

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 4, S.I. No. 393 of 2013.

F20

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 5, S.I. No. 393 of 2013.

F21

Inserted (1.08.2004) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 10(2) and sch. 1 pt. 7 item 3, S.I. No. 455 of 2004.

Modifications (not altering text):

C5

Application of subs. (2) restricted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 15(2), S.I. No. 393 of 2013.

Board of directors.

15.— ...

(2) An amendment to the rules of a credit union passed in accordance with section 14(1) of the Principal Act to give effect to a reduction in the number of board of directors in compliance with that Act, shall have immediate effect notwithstanding section 14(2) of that Act.

C6

Application of subs. (4) restricted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 4(4), S.I. No. 280 of 2013.

Savers for regulatory actions of Bank.

4.—...

(4) Notwithstanding anything in section 14(4) of the Principal Act, after the expiry of one year from the commencement of this section, the Bank shall not be required to register any amendment of a credit union’s rules unless such consequential amendments of the registered rules as are mentioned in subsection (2) either—

( a) have been made before the Bank receives the amendment; or

( b) are to be effected by the amendment.

Editorial Notes:

E15

Previous affecting provision: subs. (5) substituted (1.08.2004) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 10(2) and sch. 1 pt. 7 item 3, S.I. No. 455 of 2004; substituted as per F-note above.

E16

Previous affecting provision: subs. (4) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 12, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

E17

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 12, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per E-note above.

Rules to bind members.

15

15. (1) Subject to subsection (2), the registered rules of a credit union shall bind the credit union and all members of it and all persons claiming through them respectively to the same extent as if—

( a) each member had subscribed his name and affixed his seal to those rules; and

( b) there were contained in those rules a covenant on the part of each member and any person claiming through him to conform to those rules subject to the provisions of this Act.

(2) A member of a credit union shall not, without his consent in writing having been first obtained, be bound by any amendment of the credit union's rules registered after he became a member, if and so far as that amendment—

( a) requires him to subscribe for more shares than the number held by him at the date of registration of the amendment; or

( b) requires him to pay upon the shares so held any sum exceeding the amount unpaid upon them at that date; or

( c) in any other way increases his liability to contribute to the share capital of the credit union.

Provision of copies of rules.

16

16. (1) A copy of the rules of a credit union shall be supplied by the credit union to any person who demands it, on payment of such fee, not exceeding the permitted maximum, as may be determined by the credit union.

(2) The permitted maximum referred to in subsection (1) is £1 or such larger sum as may for the time being be prescribed.

Membership

Requirements of, and qualifications for, membership.

17

17. (1) The minimum number of members of a credit union at any time shall be 15 except that, in the case of a credit union which—

( a) by virtue of subsection (3) of section 5 , is at the commencement of that section deemed to be registered as a credit union, and

( b) has at that commencement a membership of not less than 7, but less than 15,

the minimum number of members at any time shall be the number of members on the register of the credit union at that commencement.

(2) Membership of a credit union shall be limited to, and consist of, the signatories to the application to register the society as a credit union and such other persons, having the common bond set out in the rules of the credit union, as have been duly admitted members of the credit union in accordance with the rules and comply with such of the rules as relate to membership.

(3) A person shall not be a member of a credit union unless he has at least one fully paid-up share in the credit union, but the rules of the credit union shall not require a person to have more than F22 [ 10 ], or such larger sum as may be prescribed, in fully paid-up shares as a condition of membership.

F23 [ (3A) Subject to the rules of the credit union concerned, a member who held common bond of that credit union shall not cease to be a member solely because that member no longer holds the common bond of that credit union. ]

F24 [ (4) If a member of a credit union ceases to have the common bond required of members of that credit union, any such member (referred to as a non-qualifying member) shall be left out of account in determining for any purpose whether a common bond exists between the members of the credit union. ]

(5) Subject to any provision to the contrary in the rules of a credit union, a person under the age of sixteen—

( a) may be a member of the credit union, and

( b) subject to subsection (6), may enjoy all the rights of membership, other than voting rights, and can give all necessary receipts.

F25 [ (6) Notwithstanding anything in subsection (5) , a member of a credit union who is not of full age may not be a member of the board of directors or of a principal Committee or an office manager of the credit union. ]

(7) Notwithstanding any other provision of this Act, a body (whether incorporated or unincorporated), the majority of the members of which are, and continue to be, eligible for membership of a credit union may itself be admitted to, and retain membership of, that credit union, with the same rights and obligations as a natural person.

(8) A member of a credit union shall not be excluded from membership by any amendment of the credit union's rules registered after he became a member.

Annotations:

Amendments:

F22

Substituted (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6(b), commenced as per section.

F23

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 6, S.I. No. 393 of 2013.

F24

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 7, S.I. No. 393 of 2013.

F25

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 8, S.I. No. 393 of 2013.

Appeal against refusal of membership.

18

18. (1) A person who applies for membership of a credit union in accordance with its rules and is refused membership may appeal against the refusal to a Judge of the District Court for the district in which the registered office of the credit union is situated.

(2) Notice of an appeal under this section shall be in writing and shall set out the grounds on which the appeal is based; and, on the hearing of the appeal, the District Court may either confirm the refusal of membership or direct the credit union to admit the appellant to membership.

(3) The decision of the District Court on an appeal under this section shall be final, except that any question of law arising on the appeal may be referred to the Court for its determination; and, by leave of the Court, an appeal shall lie to the Supreme Court from any such determination of the Court.

Expulsion and withdrawal from credit union.

19

19. (1) A member of a credit union may be expelled from the credit union by a resolution for his expulsion passed by not less than two-thirds of the members present and voting at a special general meeting called for the purpose, provided that the member concerned—

( a) is given at least 21 days' notice in writing of the meeting and the proposed resolution; and

( b) is given a reasonable opportunity of being heard at the meeting.

(2) A member who is expelled from a credit union may appeal against the expulsion to a Judge of the District Court for the district in which the registered office of the credit union is situated.

(3) Notice of an appeal under this section shall be in writing and shall set out the grounds on which the appeal is based; and, on the hearing of the appeal, the District Court may either confirm or cancel the expulsion.

(4) Subsection (3) of section 18 shall apply to an appeal under this section as it applies to an appeal under that section.

(5) A member of a credit union may withdraw from membership of the credit union by giving notice in accordance with the rules of the credit union.

(6) Subject to subsections (7) and (8), all moneys due in respect of withdrawable shares and deposits by a credit union to a member who withdraws or is expelled from the credit union shall be paid to him after deduction of all moneys due from him to the credit union; and the nominal value of non-withdrawable shares held by a member who is expelled (but not one who withdraws) may also be paid to him (after deduction of all moneys so due).

(7) Notwithstanding anything in its rules or in any contract, a credit union may, if it thinks fit, postpone payment of the whole or any part of the moneys to be paid as mentioned in subsection (6) until the end of the period of 60 days beginning on the date of the expulsion or withdrawal of the member concerned.

(8) No payment in respect of shares shall be made by a credit union to a withdrawing or expelled member while any claim due on account of deposits is unsatisfied and no payment of any description shall be made to such a member unless all his liabilities (including contingent liabilities) to the credit union, whether as borrower, guarantor or otherwise, have been fully discharged or otherwise fully provided for by a person other than the credit union.

(9) The withdrawal or expulsion of a member from a credit union shall not operate to relieve that member from any liability to the credit union which exists at the time of the withdrawal or expulsion.

Remedy for debts from members.

20

20. (1) All money payable to a credit union by a member of it shall be recoverable summarily as a civil debt by the credit union from the member.

(2) A credit union shall have a lien on the shares, deposits, dividends and interest of any member for any debt due to the credit union from that member, and may set off any sum credited to the member on those shares, deposits, dividends and interest in or towards the payment of that debt.

Nomination of property in credit union.

21

21. (1) Subject to subsections (2) to (4), a member of a credit union who is of or over the age of sixteen may, by a written statement signed by him and—

( a) made in any book kept at the credit union's registered office, or

( b) delivered at or sent to that office during his lifetime,

nominate a person or persons to become entitled at his death to the whole, or such part or parts as may be specified in the nomination, of any property in the credit union (whether in savings, loans, insurances or otherwise) which he may have at the time of his death.

(2) The nomination by a member of a credit union under subsection (1) of a person who is at the date of the nomination an officer of the credit union shall not be valid unless that person is a member of the nominator's family.

(3) For the purpose of the disposal of any property which is the subject of a nomination under subsection (1), if at the date of the nominator's death the amount of his property in the credit union comprised in the nomination exceeds F26 [ 23,000 ], the nomination shall be valid to the extent of F26 [ 23,000 ] but not further or otherwise.

(4) A nomination by a member of a credit union under subsection (1) may be revoked or varied by a subsequent nomination by him under that subsection or by any similar document in the nature of a revocation or variation signed by the nominator and delivered to the credit union's registered office during his lifetime; but such a nomination shall not be revocable or variable by the will of the nominator or by any codicil to his will.

(5) Each credit union shall keep a record—

( a) of the names of all persons nominated by its members under subsection (1) and such other details as will positively identify the nominees; and

( b) of all revocations or variations (if any) of nominations under that subsection.

(6) The marriage of a member of a credit union shall operate as a revocation of any nomination made by him under subsection (1) before his marriage, but if, in ignorance of a later marriage, an officer of the credit union transfers any property of that member in pursuance of such a nomination, the receipt of the nominee shall be a valid discharge to the credit union, and the credit union shall be under no liability to any other person claiming the property.

(7) A nomination under subsection (1) shall be revoked by the death of the nominee before the death of the nominator.

Annotations:

Amendments:

F26

Substituted (17.10.2006) by Credit Union Act 1997 (Alteration of Financial Limits) Regulations 2006 (S.I. No. 546 of 2006), reg. 2(a).

Editorial Notes:

E18

Previous affecting provision: subs. (3) amended (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6(c), commenced as per section; further amended as per F-note above.

Proceedings on death of nominator.

22

22. (1) Subject to subsection (2), where any member of a credit union has made a nomination under section 21 , the board of directors, on receiving satisfactory proof of the death of that member, and if and to the extent that the nomination is valid under subsection (1) of that section, shall in the case of each person entitled under the nomination either transfer to him, or pay him the full value of, the property to which he is so entitled.

(2) Where any of the property comprised in a nomination under section 21 consists of shares in the credit union, subsection (1) shall have effect notwithstanding that the rules of the credit union declare the shares in the credit union not to be transferable; but if the transfer of any shares comprised in the nomination in the manner directed by the nominator would raise the shareholding of any nominee beyond the maximum for the time being permitted in the case of that credit union, the board of directors—

( a) shall not transfer to that nominee more of those shares than will raise his shareholding to that maximum; and

( b) shall pay him or transfer to his deposit account the value of any of those shares not transferred.

(3) Where any sum falls to be paid under subsection (1) or subsection (2) to a nominee under the age of sixteen years, the credit union may pay that sum to either parent, or to a guardian, of the nominee or to any other person of full age—

( a) who will undertake to hold it on trust for the nominee or to apply it for his benefit; and

( b) whom the credit union may think a fit and proper person for the purpose;

and a receipt for that sum signed by that parent, guardian or other person shall be a sufficient discharge to the credit union for all money so paid.

Provision for small payments on death.

23

23. (1) If a member of a credit union dies and, at his death, his property in the credit union (whether in savings, loans, insurance or otherwise)—

( a) does not in the whole exceed the maximum relevant for the purposes of this section, and

( b) is not the subject of a nomination under section 21 ,

the board of directors may, without letters of administration or probate of any will, distribute that property among such persons as appears to the board (on such evidence as they consider satisfactory) to be entitled by law to receive it.

(2) The maximum referred to in subsection (1) (a) is F27 [ 15,000 ] or such greater amount as may be prescribed.

Annotations:

Amendments:

F27

Substituted (17.10.2006) by Credit Union Act 1997 (Alteration of Financial Limits) Regulations 2006 (S.I. No. 546 of 2006), reg. 2(b).

Editorial Notes:

E19

Previous affecting provision: subs. (2) amended (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6(d), commenced as per section; further amended as per F-note above.

Payments in respect of mentally incapable persons.

24

24. (1) This section applies where, in the case of a member of a credit union or a person claiming through such a member, the credit union's board of directors is satisfied—

( a) after considering medical evidence, that the member or other person is incapable by reason of a mental condition to manage and administer his own property; and

( b) that no person has been duly appointed to administer his property on his behalf, whether by a court, pursuant to Part II of the Powers of Attorney Act, 1996, or otherwise.

(2) If, in a case where this section applies, it is proved to the satisfaction of the board of directors that it is just and expedient to do so, the credit union may pay the amount of any property belonging to the member or other person (whether in the form of savings, loans, insurances or otherwise) to any person whom the board judges proper to receive it on his behalf and who furnishes to the board such a statement as is referred to in subsection (3); and a receipt for that amount signed by such a person shall be a sufficient discharge to the credit union for any sum so paid.

(3) The statement mentioned in subsection (2) is one which certifies that the proposed recipient—

( a) understands that it is his duty to apply the amount which is proposed to be paid in the best interests of the person to whom it belongs; and

( b) is aware that he may incur civil or criminal liability if he misapplies the whole or any part of that amount; and

( c) is not aware that any other person has authority to receive the whole or any part of that amount, whether by virtue of an order of a court, a power of attorney or otherwise.

Validity of payments to persons apparently entitled.

25

25.All payments or transfers made by the board of directors of a credit union under section 23 or section 24 to a person appearing to the board at the time of payment or transfer to be entitled under the section in question shall be valid and effectual against any demand made upon the board or credit union by any other person.

PART III

Operation of Credit Unions

Business and raising of funds

General principles.

26

26. (1) A credit union shall not carry on any business or activity which is not appropriate or incidental to the objects for which, in accordance with section 6 , it is formed.

(2) Subject to subsection (1), a credit union may—

( a) acquire property of any description permitted by or under this Act; and

( b) do anything expedient for accomplishing, or conducive to or consequential upon, the objects for which the credit union is formed.

(3) Where any act or other thing is done by a credit union—

( a) which it had no power to do, but

( b) which, if it had been empowered to do, would have been lawfully and effectively done,

that act or thing shall be effective in favour of any person who, relying on that act or thing, dealt with the credit union in good faith.

(4) The Court may, on the application of a member or the F28 [ Bank ] restrain a credit union from doing any act or thing which it has no power to do.

(5) Without prejudice to subsection (4), if a credit union knowingly contravenes subsection (1), it shall be guilty of an offence.

Annotations:

Amendments:

F28

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 13, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Raising of funds by shares and deposits.

27

F29 [ 27. (1) A credit union may raise funds to be used for its objects

( a ) by the issue to its members of shares in the credit union (which may be withdrawable or non-withdrawable), and

( b ) by the acceptance of money on deposit from a member,

and the cumulative amount of such shares in, and money on deposit (if any) with, the credit union is referred to in this Act as savings .

(2) For the adequate protection of the savings of members of credit unions the Bank may prescribe requirements and limits for savings, including

( a ) the maximum amount of savings (expressed as a monetary amount or as a percentage of some monetary amount or determinable monetary amount) or category of savings a credit union member may hold,

( b ) the ratio of total deposits from members that may be held by a credit union to total shares issued to members, and

( c ) any other requirement or limit which the Bank considers necessary to prescribe.

(3) In prescribing matters for the purposes of this section, the Bank shall have regard to the need to ensure that the requirements imposed by the regulations made by it are effective and proportionate having regard to the nature, scale and complexity of credit unions, or the category or categories of credit unions, to which the regulations will apply. ]

Annotations:

Amendments:

F29

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 8, S.I. No. 584 of 2015.

Editorial Notes:

E20

Previous affecting provision: power pursuant to subsection (5) exercised and subss. (2) and (4) amended (14.08.2006) by Credit Union Act 1997 (Alteration of Financial Limits) Order 2006 (S.I. No. 453 of 2006), art. 2; substituted as per F-note above.

E21

Previous affecting provision: subss. (3) and (4) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 14, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

E22

Previous affecting provision: subs. (1)(b) amended (1.01.2002) by Credit Union Act, 1997 (Alteration of Financial Limit) Regulations 2001 (S.I. No. 476 of 2001), reg. 1(b); substituted as per F-note above.

E23

Previous affecting provision: subss. (1)(b) and (4)(a), (b) amended (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6(e), commenced as per section; further amended as per E-note above.

E24

Previous affecting provision: subs. (1)(b) amended (25.10.2001) by Credit Union Act, 1997 (Alteration of Financial Limit) Regulations 2001 (S.I. No. 476 of 2001), reg. 1(a); further amended as per E-note above.

27A

F30 [ Protection of members' savings.

27A. (1) In addition to its reporting functions under the Credit Union Acts 1997 to 2012 and complying with any matter prescribed under those Acts, a credit union shall maintain appropriate oversight, policies, procedures, processes, practices, systems, controls, skills, expertise and reporting arrangements to ensure the protection of members savings and that it complies with requirements imposed under the financial services legislation.

(2) Without prejudice to the generality of subsection (1), the Bank may make regulations prescribing

( a ) certain oversight, policies, procedures, processes, practices, systems, controls, skills, expertise and reporting arrangements which the credit union is required to maintain where the Bank considers this is appropriate in the interest of protecting members savings or otherwise appropriate to ensure compliance with the requirements imposed under financial services legislation;

( b ) requirements in relation to the oversight, policies, procedures, processes, practices, systems, controls, skills, expertise and reporting arrangements required to be maintained under this section. ]

Annotations:

Amendments:

F30

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 9, S.I. No. 393 of 2013.

Shares and deposits

Shares: general provisions.

28

28. (1) All shares in a credit union shall be of F31 [ 1 ] denomination and, subject to the rules of the credit union, may be subscribed for either in full or by periodical or other subscriptions, but no share shall be allotted to a member until it has been fully paid in cash.

(2) A credit union shall not issue to a member a certificate denoting ownership of a share.

(3) All withdrawable shares in a credit union shall have equal rights.

(4) All non-withdrawable shares in a credit union shall have equal rights, and repayments in respect of such shares shall not be capable of being made except as provided by this Act.

(5) Notwithstanding subsection (1), whenever its board of directors so recommends, a credit union may apply any sum standing to the credit of its reserves F32 [ (other than the reserves required to be held under section 45 ) ] to the payment up of shares, and may issue the shares to members as fully paid-up bonus shares in the proportions to which the members would have been entitled if the sum concerned had been distributed by way of dividend.

Annotations:

Amendments:

F31

Substituted (1.01.2002) by Euro Changeover (Amounts) Act 2001 (16/2001), s. 6(f), commenced as per section.

F32

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 9, S.I. No. 584 of 2015.

Transfer of shares.

29

29. (1) A member of a credit union may transfer a share in the credit union to another member so long as—

( a) the number of shares held by that other member does not exceed the limit imposed under this Act; and

( b) if the board of directors so require in any case, the transfer has the approval of the board.

(2) No charge shall be made by a credit union in respect of a transfer of shares by a member, and such a transfer shall entitle the transferee to any dividends in respect of the transferred shares which are unpaid at the date of the transfer.

(3) If, in a case where the board of directors of a credit union have imposed a requirement under subsection (1)(b), the board refuses to approve the proposed transfer of shares in the credit union by a member, the member may appeal against the refusal to a Judge of the District Court for the district in which the registered office of the credit union is situated.

(4) Notice of appeal under subsection (3) shall be in writing and shall set out the grounds on which the appeal is based; and, on the hearing of the appeal, the District Court may either confirm the refusal or direct the board of directors to approve the transfer.

(5) A decision of the District Court on an appeal under subsection (3) shall be final, except that any question of law arising on the appeal may be referred to the Court for its determination; and, by leave of the Court, an appeal shall lie to the Supreme Court from every such determination.

Dividends on shares.

30

30. (1) At each annual general meeting of a credit union, a dividend on shares, not exceeding the permitted maximum, may be declared in respect of the preceding financial year by a resolution passed by a majority of the members present and voting.

(2) A dividend so declared shall be paid on all shares in the credit union but, in the case of shares which have been held during part only of the financial year to which the dividend relates, only a proportional part of the dividend shall be paid and, in determining such a proportional part, a part of a month may be disregarded.

(3) The permitted maximum referred to in subsection (1) is ten per cent. of the nominal value of the shares of the credit union or such other percentage of that value as may for the time being be prescribed.

(4) The rate of dividend declared under subsection (1) shall not exceed the rate recommended to the members by the board of directors.

(5) No dividend on shares shall be paid otherwise than out of—

( a) surplus funds in respect of the year in question (as ascertained under section 45 ) which are available for that purpose and have been accumulated after meeting the F33 [ requirements to hold reserves in accordance with section 45 ] ; or

( b) a reserve set aside in previous years to provide for dividends.

Annotations:

Amendments:

F33

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 10, S.I. No. 584 of 2015.

Interest on deposits.

31

31. (1) Subject to subsections (2) and (3), a credit union may pay interest on deposits at different rates determined from time to time by the board of directors.

(2) The rate of any interest payable at any time by a credit union on deposits of a particular class shall be the same for all deposits of that class.

(3) A credit union shall ensure that the F34 [ rate of interest offered ] at any time on deposits of any class does not exceed the rate of return received by the credit union from the employment of its funds, whether in the form of loans or investments.

(4) F35 [ ]

Annotations:

Amendments:

F34

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 11, S.I. No. 393 of 2013.

F35

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 12, S.I. No. 280 of 2013.

Restrictions on withdrawal of shares and deposits.

32

32. (1) Notwithstanding anything in the rules of a credit union or in any contract, a credit union may require not less than 60 days’ notice from a member of his intention to withdraw a share in the credit union and a member may not withdraw any shares at a time when a claim due on account of deposits is unsatisfied.

(2) Notwithstanding anything in the rules of a credit union or in any contract, a credit union may require not less than 21 days’ notice from a member of his intention to withdraw a deposit.

F36 [ (3)( a ) If a member of a credit union seeks to withdraw savings in the credit union at a time when the member has an outstanding liability (including a contingent liability) to the credit union, whether as borrower, guarantor or otherwise, that withdrawal shall only be permitted

(i) if the savings are not attached savings; or

(ii) where the savings are attached savings, if the withdrawal of such attached savings is approved by a majority of the members of the board of directors voting at a meeting of the board;

but no approval may be given under subparagraph (ii) if, were the withdrawal to be approved, the value of the member s attached savings immediately after the withdrawal would be less than 25 per cent of the member s outstanding liability.

( b ) Any savings that existed in the credit union immediately before the commencement of this provision (inserted by the Credit Union and Co-operation with Overseas Regulators Act 2012) that were not withdrawable under this subsection immediately before that commencement shall be treated as attached savings after that commencement.

( c ) Where the outstanding liability reduces below the level of attached savings, the amount of the attached savings shall not be greater than the outstanding balance of the loan.

( d ) In this subsection

attached savings means a share in, or deposit with, a credit union which is pledged in writing by a member as security for a loan at the time of the issuing of the loan to the member or guaranteed by the member;

savings means a share in, or deposit with, the credit union. ]

(4) If the F37 [ Bank ] sees fit to do so in the circumstances of a credit union, F37 [ it ] may, on such terms as F37 [ it ] thinks proper, by notice in writing addressed to the credit union provide that subsection (3) shall apply in relation to the credit union with the substitution of a higher or lower percentage than that for the time being applicable to the credit union under that subsection.

(5) Where a member of a credit union is indebted to the credit union and consents in writing to the credit union acting under this subsection, the credit union may, by way of set-off against the indebtedness, withdraw any of the member's shares or deposits; and such a withdrawal may be made notwithstanding anything in subsections (2) and (3).

Annotations:

Amendments:

F36

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 13, S.I. No. 393 of 2013.

F37

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 15, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Borrowing

Power to borrow.

33

F38 [ 33. (1) For the purpose of its objects as referred to in section 6 a credit union may borrow money, on security or otherwise, and may issue debentures accordingly.

(2) For the adequate protection of the savings of members of credit unions, the Bank may prescribe

( a ) the maximum amount of money a credit union may borrow at any one time which may be expressed as a percentage of the aggregate of shares balance and the deposits balance of the credit union, and

( b ) the notice to be given to the Bank by a credit union in specified circumstances where the credit union proposes to borrow certain amounts of money (expressed as a monetary amount or as a percentage of some monetary amount or determinable monetary amount) in respect of those circumstances.

(3) Where the Bank considers it is necessary in the interests of the proper regulation of a credit union or credit unions generally, or the protection of members savings, it may do either or both of the following:

( a ) permit a credit union to borrow moneys in excess of the amount prescribed in accordance with subsection (2) ;

( b ) waive any notice requirement prescribed in accordance with subsection (2) .

(4) A person dealing with a credit union shall not be obliged to be satisfied or to enquire into whether the limit imposed on the credit union by virtue of subsection (2) (or such limit as may be duly affected under subsection (3) ) has been or is being observed; but if a person who lends money to a credit union or takes security in connection with such a loan has, at the time the loan is made or the security is taken, actual notice of the fact that that limit has been or is thereby exceeded, the credit union s debt or, as the case may be, the security shall be unenforceable.

(5) Subject to subsection (4) , a transaction with a credit union shall not be invalid or ineffectual by reason of the fact that the limit on borrowing prescribed by the Bank under subsection (2) (or such limit as may be duly affected under subsection (3) ) has been or is by the transaction exceeded.

(6) In prescribing matters for the purposes of this section, the Bank shall have regard to the need to ensure that the requirements imposed by the regulations made by it are effective and proportionate having regard to the nature, scale and complexity of credit unions, or the category or categories of credit unions, to which the regulations will apply. ]

Annotations:

Amendments:

F38

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 10, S.I. No. 584 of 2015.

Editorial Notes:

E25

Previous affecting provision: subs. (2) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 16, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Charges on assets of a credit union.

34

34. (1) An instrument which is executed by a credit union and which creates or is evidence of a charge on any assets of the credit union shall not be a bill of sale for the purposes of the Bills of Sale (Ireland) Acts, 1879 and 1883 or be invalidated by those Acts if the charge is recorded in accordance with subsection (2).

F39 [ (2) An application for the recording of a charge under subsection (1) must be made by delivering to the Bank, within the permit- ted period

( a ) a copy of the instrument authenticated in such manner as may be specified by the Bank, and

( b ) such additional particulars relating to the charge and authenticated as may be so specified.

The permitted period is 21 days from the date of execution of the instrument that creates or is evidence of the charge, or such extended period as may be allowed under subsection (5) .

(2A) The application must be accompanied by the fee (if any) prescribed under section 33K of the Central Bank Act 1942 , for the purposes of this subsection. ]

(3) The F39 [ Bank ] shall ensure—

( a) that an acknowledgement of every application made for the purposes of this section is issued to the person by whom the application was made; and

( b) that the copy of the instrument included in such an application, a note of any particulars specified by the F39 [ Bank ] and so included and a copy of the acknowledgement of the application issued in pursuance of paragraph (a) are placed in the public file of the credit union;

and an acknowledgement issued under this subsection shall, unless the contrary is proved, be sufficient evidence that any document specified in the acknowledgement was delivered to the F39 [ Bank ] on the date so specified.

F39 [ (4) Regulations under section 182 may provide for the giving of notice to the Bank of any release, discharge or other transaction relating to any charge in respect of which an application has been made for the purposes of this section and for the placing of any such notice on the public file of the credit union concerned. ]

(5) If, in the case of such an instrument as is mentioned in subsection (1), it appears to the Court, on the application of the credit union which executed the instrument or of any other person claiming the benefit of the instrument, that by reason of inadvertence or other sufficient cause—

( a) an application for the recording of the charge to which the instrument relates was not made within the period of 21 days mentioned in subsection (2); or

( b) any matters were omitted from or were mis-stated in such an application,

the Court may, on such terms as it thinks fit, order that the period for making such an application shall be extended or, as the case may be, that the omission or misstatement shall be rectified.

Annotations:

Amendments:

F39

Substituted and inserted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 17, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Loans

Making of loans.

35

F40 [ 35. (1) ( a ) In this section large exposure , in relation to loans of a credit union to a borrower or a group of borrowers who are connected, means the total exposure (including contingent liabilities) of the credit union where the total exposure to such borrower or group of borrowers would be greater than an amount (whether expressed as a monetary amount or as a percentage of some monetary amount or determinable monetary amount) prescribed by the Bank.

( b ) For the purposes of this subsection

control has the meaning assigned to it by section 432 of the Taxes Consolidation Act 1997 and the other relevant provisions of Part 13 of that Act;

group of borrowers who are connected means 2 or more persons

(i) who, unless it is shown otherwise, constitute a single risk because one of them, directly or indirectly, has control over the other person or persons (not being individuals); or

(ii) between whom there is no relationship of control as set out in subparagraph (i), but who are to be regarded as constituting a single risk because they are so interconnected that, if one of them were to experience financial problems, the other person or some or all of the other persons would be likely to encounter repayment difficulties.

(2) A credit union may make a loan to a member for such purpose as the credit union considers appropriate, upon such security (or without security) and terms as the rules of the credit union may provide. The ability of the loan applicant to repay shall be the primary consideration in the underwriting process of the credit union.

(3) A credit union shall manage and control lending to ensure the making of loans does not involve undue risk to members savings taking into account the nature, scale, complexity and risk profile of the credit union.

(4) Every application to a credit union for a loan shall be in writing and shall state the purpose for which the loan is required and the security (if any) offered for it.

(5) A credit union shall not accept from an officer of the credit union a guarantee for a loan to another member unless that other member is the officer s spouse or civil partner, child or parent.

(6) Where the rules of a credit union so provide, the credit union may determine in accordance with those rules the total, including percentage, amount of loans (if any) that it may grant to non-qualifying members.

(7) In relation to loans to which this section relates and for the adequate protection of the savings of members of credit unions, the Bank may prescribe one or more of the following:

( a ) the classes of lending a credit union may engage in whether by reference to any common characteristic of the credit unions or loans concerned, or otherwise;

( b ) the limits on the total, including percentage, amount of loans generally, or unsecured loans or class or classes of loans, that may be lent by credit unions, having regard to period or periods of time for which loans concerned are made;

( c ) the matters relating to large exposures of credit unions and limits relating to such exposures;

( d ) the limits on the concentration of lending, including concentration limits on loan classes, including concentration limits on loans to a member of a credit union;

( e ) any other limit that the Bank considers appropriate.

(8) For the adequate protection of the savings of members of credit unions the Bank may prescribe such other requirements as it considers necessary in relation to any one or more of the following matters:

( a ) the lending practices of credit unions, including

(i) loan application assessments,

(ii) the making of provision for specified matters,

(iii) reviews to assess the adequacy of provisions,

(iv) maintaining policies for the holding of provisions, for credit and for credit control,

(v) the types of security that may be accepted;

( b ) reporting loans to the Bank;

( c ) the holding by credit unions of provisions, reserves or capital against loans or specified classes or types of loans.

(9) In prescribing matters for the purposes of this section, the Bank shall have regard to the need to ensure that the requirements imposed by the regulations made by it are effective and proportionate having regard to the nature, scale and complexity of credit unions, or the category or categories of credit unions, to which the regulations will apply.

(10) A credit union shall ensure that it has appropriate processes, procedures, systems, controls and reporting arrangements to monitor compliance with the requirements of this section and any requirement imposed under this section.

(11) Subject to its rules, in respect of a loan, a credit union may accept, in addition to other forms of security

( a ) a guarantee by a member, or

( b ) a pledge by a member of shares in or deposits with the credit union,

and, where such a guarantee or pledge is accepted, it shall be deemed to be a security for the loan. ]

Annotations:

Amendments:

F40

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 11(1), S.I. No. 584 of 2015, subject to transitional provisions in subs. (2).

Editorial Notes:

E26

Previous affecting provision: subs. (10) amended (1.01.2011) by Civil Partnership and Certain Rights and Obligations of Cohabitants Act 2010 (24/2010), s. 97(2) and sch. pt. 1 item 23, S.I. No. 648 of 2010; section substituted as per F-note above.

E27

Previous affecting provision: subss. (2)-(2F) substituted and inserted (1.10.2010) by Central Bank Reform Act 2010 (23/2010), s. 15(7) and sch. 2 pt. 7 item 2, S.I. No. 469 of 2010; section substituted as per F-note above.

E28

Previous affecting provision: subs. (2) substituted (1.11.2007) by Markets in Financial Instruments and Miscellaneous Provisions Act 2007 (37/2007), s. 17, S.I. No. 730 of 2007; section substituted as per E-note above.

E29

Previous affecting provision: subs. (2) amended (26.04.2007) by Credit Union Act 1997 (Alteration of Financial Limits) Regulations 2007 (S.I. No. 193 of 2007), reg. 2; section substituted as per E-note above.

E30

Previous affecting provision: subs. (4) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 18, S.I. No. 160 of 2003, subject to transitional provisions in 36 and sch. 3 para. 26; section substituted as per F-note above.

E31

Previous affecting provision: subs. (3)(a) amended (1.01.2002) by Euro Changeover (Amounts) Act, 2001 (16/2001), s. 6(g), commenced as per section; section substituted as per F-note above.

Approval of loans.

36

36. (1) A credit union shall not make a loan to a member unless it is approved in accordance with this section.

(2) Subject to subsections (3) and (5), a loan must be approved, according as the rules of the credit union require—

( a) by such number of members of the board of directors voting by secret ballot at a meeting of the board at which the application for the loan is considered as represents at least two-thirds of those present and a majority of the members of the board as a whole; or

( b) by such number of members of the credit committee present at a meeting of that committee at which the application for the loan is considered as represents at least two-thirds of those present and a majority of the committee members as a whole; or

( c) by a credit officer.

F41 [ (3) Subject to subsection (5) , a loan to an officer is required to be approved by not less than two-thirds of the members of a special committee voting by secret ballot at a meeting at which the application for the loan is considered. ]

F42 [ (4) The special committee referred to in subsection (3) shall consist of

( a ) a majority of the board of directors, and

( b ) at least one member of the credit committee,

but shall not include the applicant for the loan. ]

F43 [ (5) Notwithstanding subsection (3) , a loan to an officer which does not exceed the value of the officer s attached savings may be approved as mentioned in paragraph (b) or (c) of subsection (2) . ]

(6) F44 [ ]

Annotations:

Amendments:

F41

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 14, S.I. No. 393 of 2013.

F42

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 15, S.I. No. 393 of 2013.

F43

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 16, S.I. No. 393 of 2013.

F44

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 17, S.I. No. 280 of 2013.

Appeal against non-approval of loan.

37

37. (1) If an application for a loan which was considered by the credit committee or by a credit officer was not approved under section 36 , the applicant may appeal to an appellate body which, by a decision of such members of the body present at the meeting at which the appeal is considered as represents at least two-thirds of those present and a majority of the body as a whole, may give approval to the loan, overriding the decision of the credit committee or credit officer, as the case may be.

(2) The appellate body referred to in subsection (1) shall consist of—

( a) the board of directors, excluding, where the application for the loan was considered by the credit committee, any director who is a member of that committee; and

( b) F45 [ ]

F46 [ (3) For the purposes of the consideration of an appeal under this section, the appellate body shall not be regarded as quorate unless there are present a majority of the directors referred to in subsection (2)(a) . ]

Annotations:

Amendments:

F45

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 18, S.I. No. 393 of 2013.

F46

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 19, S.I. No. 393 of 2013.

37A

F47 [ Member to receive written notice of loan approval.

37A. (1) On approving a loan in accordance with section 36 or 37 , a credit union shall, in writing, notify the member who applied for the loan of the approval and of any time limit within which the approval will expire.

F48 [ (2) A notice under subsection (1) may be in a form that, when endorsed by the member on accepting a loan offered by the credit union, constitutes a credit agreement for the purposes of

( a ) sections 37B and 37C , or

( b ) where the loan is for an amount between 200 and 75,000, the European Communities (Consumer Credit Agreements) Regulations 2010 ( S.I. No. 281 of 2010 ). ] ]

Annotations:

Amendments:

F47

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F48

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 20, S.I. No. 393 of 2013.

37B

F49 [ Credit agreement in respect of loans exceeding 200.

37B. (1) If the amount of a loan approved by a credit union exceeds 200, the credit union shall ensure that

( a ) a credit agreement is entered into in writing and signed by the member concerned and by or on behalf of all other parties to the agreement, and

( b ) a copy of the agreement

(i) is handed personally to the member immediately after the agreement is entered into, or

(ii) is delivered or sent to the member within 10 days after the agreement is entered into, and

( c ) any contract of guarantee relating to the loan is in writing and signed by the guarantor and by or on behalf of all other parties to the agreement, and a copy of the guarantee and the agreement

(i) is handed personally to the guarantor immediately after the contract is entered into, or

(ii) is delivered or sent to the guarantor within 10 days after the contract is entered into.

F50 [ (2) For the purposes of this section, a contract of guarantee

( a ) includes, where the member is not of full age, an indemnity provided by a parent or guardian of the member or by another person approved by the board of directors, and

( b ) may form part of the relevant agreement or may be in a separate document. ]

(3) A credit union that makes a loan without having complied with subsection (1) commits an offence.

(4) If a credit union is found guilty of an offence against subsection (3) , the following provisions apply:

( a ) the credit union is taken to have waived all interest agreed to be paid by the member in respect of the loan;

( b ) the member, or the member s personal representative, is entitled to recover as a debt, by proceedings brought in a court of competent jurisdiction, any interest paid in respect of the loan. ]

Annotations:

Amendments:

F49

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F50

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 21, S.I. No. 393 of 2013.

37C

F51 [ Contents of credit agreements.

37C. (1) When entering into a credit agreement with a member, a credit union shall ensure that it contains a statement setting out the following particulars:

( a ) the name and address of each party to the agreement;

( b ) the amount of the loan provided under the agreement and the total amount payable in respect of the loan;

( c ) details of the security (if any) given in respect of the loan;

( d ) the date or dates on which the loan is to be provided (unless unascertainable at the time of the agreement);

( e ) the number of repayment instalments under the agreement and amount of each of those instalments;

( f ) the date, or the method of determining the date, on which each repayment instalment is payable;

( g ) the rate of interest charged in respect of the loan and the relevant APR;

( h ) the circumstances in which that APR may be amended;

( i ) any charges that, although not included in the calculation of the APR, must be paid by the member in specified circumstances;

( j ) the date on which the loan expires;

( k ) the manner in which the member can terminate the agreement before the final repayment instalment is payable and the cost to the member of terminating the agreement;

( l ) any cost or penalty that the member may incur for failing to comply with the agreement.

F52 [ (2) The credit union shall also ensure that the agreement specifies a cooling-off period under which the member has a right to withdraw from the agreement without penalty if the member gives to the credit union a written notice to that effect within 14 days after

( a ) the day on which the credit agreement was concluded, or

( b ) the day on which the member receives contractual terms and conditions and information in accordance with sections 37C and 37D if that date is later than the date referred to in paragraph (a) . ]

(3) F53 [ ]

(4) A credit union that fails to comply with subsection (1) or (2) commits an offence. ]

F54 [ (5) This section does not apply to credit agreements covered by the European Communities (Consumer Credit Agreements) Regulations 2010. ]

Annotations:

Amendments:

F51

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F52

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 22, S.I. No. 393 of 2013.

F53

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 23, S.I. No. 393 of 2013.

F54

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 24, S.I. No. 393 of 2013.

37D

F55 [ Notice of important information to be included in credit agreements.

37D. (1) A credit union shall not enter into a credit agreement with a member, unless the agreement and the notice referred to in section 37A(1) display prominently on their respective front pages, in a form approved by the Bank, the following information:

( a ) the amount of the loan;

( b ) the period of the agreement;

( c ) the number of repayment instalments;

( d ) the total amount repayable to the credit union;

( e ) the cost of the loan to the member;

( f ) the APR in respect of the loan;

( g ) particulars of the cooling-off period.

(2) A credit union that contravenes subsection (1) commits an offence. ]

F56 [ (3) This section does not apply to credit agreements covered by the European Communities (Consumer Credit Agreements) Regulations 2010. ]

Annotations:

Amendments:

F55

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F56

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 25, S.I. No. 393 of 2013.

37E

F57 [ Definition and calculation of 'APR' for the purposes of sections 37C and 37D .

F58 [ 37E. (1) For the purposes of sections 37C and 37D annual percentage rate of charge , in relation to a credit agreement entered into between a credit union and a member, means the annual percentage rate of charge as defined under Regulation 6 of the European Communities (Consumer Credit Agreements) Regulations 2010.

(2) The annual percentage rate of charge specified in a credit agreement shall be in accordance with Part 5 of the European Communities (Consumer Credit Agreements) Regulations 2010. ] ]

Annotations:

Amendments:

F57

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F58

Substituted (11.10.2013) by Central Bank and Financial Services Authority of Ireland Act 2004 (40/2012), s. 35 and sch. 1 item 26, S.I. No. 393 of 2013.

37F

F59 [ Regulations for the purposes of sections 37A - 37D .

37F. F60 [ ] . ]

Annotations:

Amendments:

F59

Inserted (1.01.2005) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 33 and sch. 3 pt. 14 item 1, S.I. No. 455 of 2004.

F60

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 27, S.I. No. 393 of 2013.

Interest on loans.

38

38. (1) A credit union may charge interest on loans made to its members under section 35 subject to the following conditions—

( a) the interest on a loan shall not at any time exceed one per cent. per month on the amount of the loan outstanding at that time;

( b) the interest on a loan shall in every case include all the charges made by the credit union in making the loan;

( c) the rate of interest charged on any class of loans granted at a particular time shall be the same for all loans of the class.

F61 [ (2) If a credit union knowingly charges or accepts interest on a loan at a rate greater than that permitted under this section

( a ) all the interest agreed to be paid by the member shall be deemed to have been waived by the credit union; and

( b ) any interest paid on the loan shall be recoverable summarily by the member (or his personal representative) as a simple contract debt. ]

Annotations:

Amendments:

F61

Substituted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 28, S.I. No. 280 of 2013.

Other transactions

Promissory notes and bills of exchange.

39

39. (1) A promissory note or bill of exchange shall be deemed to have been made, accepted or endorsed on behalf of a credit union if made, accepted or endorsed in the name of the credit union by a person acting under its authority.

(2) Where no such authority as is referred to in subsection (1) exists, the F62 [ Bank ] may, if F62 [ it ] thinks fit, appoint a person or persons to act on behalf of the credit union; and any person or persons so appointed shall have the like powers under subsection (1) as if acting under the authority of the credit union.

Annotations:

Amendments:

F62

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 19, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Contracts.

40

40. (1) Contracts may be made, varied or discharged on behalf of a credit union as follows:

( a) a contract which, if made between individuals, would be by law required to be in writing under seal may be made on behalf of the credit union in writing under the common seal of the credit union;

( b) a contract which, if made between individuals, would be by law required to be in writing, signed by the parties to be charged with the contract, may be made on behalf of the credit union in writing by any person acting under the express or implied authority of the credit union;

( c) a contract which, if made between individuals, would by law be valid although made by parol only, and not reduced into writing, may be made by parol on behalf of the credit union by any person acting under the express or implied authority of the credit union;

( d) a contract made according to this subsection may be varied or discharged in the same manner in which it is authorised by this section to be made and a contract under seal which, if made between individuals, might be varied or discharged in writing not under seal, signed by any person interested in the contract, may be similarly varied or discharged in writing not under seal on behalf of the credit union, signed by any person acting under the express or implied authority of the credit union.

(2) A signature purporting to be made by a person holding any office in a credit union attached to a writing by which any contract purports to be made, varied or discharged by or on behalf of the credit union shall, unless the contrary is proved, be taken to be the signature of a person holding that office at the time when the signature was made.

(3) Where authority no longer exists for the discharge of a credit union's obligations under subsection (1), the F63 [ Bank ] may, if F63 [ it ] thinks fit, appoint a person to act on behalf of the credit union, and a person so appointed shall have the like powers to make, vary or discharge contracts on behalf of the credit union as if acting under its authority.

(4) A contract which may be or have been made, varied or discharged according to the provisions of this section shall be effectual in law and bind the credit union and its successors and all other parties to the contract.

Annotations:

Amendments:

F63

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 20, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Acquisition, holding and disposal of land.

41

41. (1) A credit union may acquire and hold in its own name any land for the purpose of conducting its business on the land (including erecting a building on the land for that purpose) but for no other purpose.

(2) A credit union may dispose of any land held by it and, where it does so—

( a) no person shall be bound to inquire as to the authority for any dealing with the land by the credit union; and

( b) a receipt of the credit union shall be a discharge for all money arising from or in connection with any dealing with land by it.

(3) For the purposes of subsection (2) (but not subsections (4) and (5)), a disposal of land held by a credit union includes the creation, out of the interest held by the credit union, of a lease, sub-lease or lesser interest.

(4) If a building held by a credit union entirely ceases to be occupied for the purposes of the business of the credit union, the credit union shall dispose of its interest in that building as soon as it is practicable to do so.

F64 [ (5) If the Bank is of the opinion that any building or other land held by a credit union is not in the best interest of the credit union, it may decide to direct and direct the credit union to dispose of its interest in it. ]

(6) F65 [ ]

(7) Section 3 (3) shall not apply to a direction under subsection (5).

Annotations:

Amendments:

F64

Substituted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 29, S.I. No. 280 of 2013.

F65

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 30, S.I. No. 280 of 2013.

Editorial Notes:

E32

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 21, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Receipt for repayment of secured debt.

42

42.On payment of all money intended to be secured to a credit union on the security of any property, the debtor or his successor in title or personal representatives shall be entitled to a receipt in the form set out in the Second Schedule , or in a form to substantially the like effect.

Investments etc.

Investments.

43

F66 [ 43. (1) A credit union shall manage its investments to ensure that those investments do not (taking account of the nature, scale, complexity and risk profile of the credit union) involve undue risk to members savings and, for that purpose, before making an investment a credit union shall assess the potential impact on the credit union, including the impact on the liquidity and financial position of the credit union.

(2) A credit union may invest any of its funds, which are surplus to its operating requirements and are not immediately required for the purposes of the credit union, in any one or more of the following:

( a ) the shares of, or deposits with (other than deposits to which subsection (6) relates) or loans to, another credit union as the Bank may prescribe;

( b ) the shares of a society registered under the Industrial and Provident Societies Acts 1893 to 1978 as the Bank may prescribe;

( c ) such other investments as may be prescribed for that purpose by the Bank under subsection (3) .

(3) For the purposes of subsection (2)(c) the Bank may prescribe investments in which a credit union may invest its funds. In prescribing matters for the purposes of subsection (2) and having regard to the need to avoid undue risk to members savings, the Bank may also prescribe other matters in relation to prescribed investments, including any of the following:

( a ) the classes of investments, including, where appropriate, any investment project of a public nature the credit union may invest in;

( b ) the quality of investments and quality of counterparties that the credit union may invest in;

( c ) the maximum, including percentage, amount (by reference to a credit union s surplus funds to which subsection (2) relates or otherwise) of a class of investments that may be invested in;

( d ) the term to maturity of a class of investments;

( e ) the currency of a class of investments;

( f ) limits for investment, whether by reference to maturity, currency, counterparty, sector, instrument or otherwise;

( g ) any other matters that the Bank may consider necessary in the circumstances.

(4) The Bank may prescribe matters for the purposes of any distribution policy to be applied by a credit union in respect of investment income.

(5) In prescribing matters for the purposes of this section, the Bank shall have regard to the need to ensure that the requirements imposed by the regulations made by it are effective and proportionate having regard to the nature, scale and complexity of credit unions, or the category or categories of credit unions, to which the regulations will apply.

(6) In so far as any funds of a credit union that are surplus to its operating requirements

( a ) are not immediately required for the purposes of the credit union,

( b ) are not invested in accordance with subsection (2) , or

( c ) are not kept in cash in the custody of officers of the credit union,

those funds shall be kept by the credit union on current account with a credit institution.

(7) Where any funds of a credit union are on current account with, or on loan to, an institution which ceases to be a credit institution, the credit union shall take all practicable steps to call in and realise the loan within the period of 3 months from the time when the institution so ceased or, if that is not possible, as soon after the end of that period as possible. ]

Annotations:

Amendments:

F66

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 12, S.I. No. 584 of 2015.

Editorial Notes:

E33

Previous affecting provision: subss. (1) and (5)(b) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 22, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Special fund for social, cultural etc. purposes.

44

44. (1) By a resolution passed by a majority of its members present and voting at a general meeting, a credit union may establish a special fund to be used by the credit union for such social, cultural or charitable purposes (including community development) as have been approved, either generally or specifically, by a similar resolution; and any such special fund shall be maintained separately from the rest of the credit union's finances.

(2) Subject to subsection (4), moneys may be paid into a special fund established by a credit union under this section only out of the annual operating surplus of the credit union; and no moneys may be so paid unless the directors are satisfied—

( a) that adequate provision has been made out of the surplus in question to cover all current and contingent liabilities and to maintain proper reserves; and

( b) that the payment of the moneys into the special fund will not affect the financial stability of the credit union.

(3) Subject to subsection (5), the amount of moneys which may be paid as mentioned in subsection (2) out of the annual operating surplus of any year shall not exceed 0.5 per cent. of the value of the credit union's assets as shown in the accounts for the most recent financial year ending before the date of the payment.

(4) In respect of the financial year in which the special fund is established, there may be paid into the special fund (in addition to any amount paid as mentioned in subsection (2)) an amount not exceeding 2.5 per cent. of the accumulated reserves of the credit union, excluding the F67 [ reserves required to be held under section 45 ] .

(5) If, by a resolution passed by not less than two-thirds of the members of the credit union present and voting at a general meeting called for the purpose, a credit union resolves to increase the percentage applicable to it under subsection (3) to a percentage to which the F68 [ Bank ] has consented in writing, that subsection shall have effect accordingly.

(6) Where a credit union has established a special fund under this section, the social, cultural or charitable purposes for which it is to be used may be varied by a further resolution passed as mentioned in subsection (1).

(7) If at any time—

( a) the board of directors make a recommendation in writing to the members of a credit union that it is appropriate to wind up a special fund established under this section, and

( b) a resolution for winding up the special fund is passed by a majority of the members of the credit union present and voting at a general meeting,

the moneys standing to the credit of the special fund shall be transferred to the general funds of the credit union and the special fund shall cease to exist.

Annotations:

Amendments:

F67

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 31, S.I. No. 584 of 2015.

F68

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 23, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Statutory reserve.

45

F69 [ 45. (1) In this section

assets means such assets as the Bank may from time to time specify for the purposes of this section;

regulatory reserve means a reserve that is a realised financial reserve which is

( a ) unrestricted and non-distributable,

( b ) identified separately in a credit union s accounts, and

( c ) to be maintained by a credit union pursuant to this section;

regulatory reserve requirement means the amount required to be held in the regulatory reserve of a credit union, expressed as a percentage of the assets of a credit union and prescribed by the Bank.

(2) A credit union shall maintain reserves that are adequate having regard to the nature, scale, complexity and risk profile of its business.

(3) The Bank may prescribe the regulatory reserve requirement that a credit union shall maintain at a minimum and, in so prescribing, may include conditions on the application of the regulatory reserve requirement. For that purpose the Bank may also prescribe in respect of other matters related to the regulatory reserve requirement, including any of the following:

( a ) the application of risk weightings to assets for the purposes of calculating the regulatory reserve requirement;

( b ) the types and attributes of the assets or liabilities included in the calculation of the regulatory reserve requirement;

( c ) the requirement for initial reserves to be held by a newly-registered credit union under section 6 .

(4) Where requirements to which subsection (3)(c) relate have been prescribed, they shall not apply to a credit union established as a result of amalgamations of 2 or more existing credit unions.

(5) A credit union shall maintain reserves, in addition to the regulatory reserve requirement prescribed under subsection (3) that

( a ) it has assessed are required in respect of operational risk having regard to the nature, scale, complexity and risk profile of its business, and

( b ) which shall not be less than those required under any additional reserve requirement applicable to it in respect of operational risk by virtue of subsection (6) .

(6) Either or both the level of additional reserves to be maintained by a credit union and the basis for calculating the additional reserves to be maintained by a credit union under this section in respect of operational risk may be prescribed by the Bank. For that purpose the Bank may also prescribe in respect of ancillary matters related to the additional reserves held in respect of operational risks.

(7) A credit union that fails to meet any reserve requirement under this section

( a ) may be required by the Bank to transfer all or part of its surplus to reserves, and

( b ) shall secure the written approval of the Bank before paying a dividend or loan interest rebate.

(8) In prescribing matters for the purposes of this section, the Bank shall have regard to the need to ensure that the requirements imposed by the regulations made by it are effective and proportionate having regard to the nature, scale and complexity of credit unions, or of the category or categories of credit unions, to which the regulations will apply.

(9) ( a ) Pending the prescribing by the Bank of reserve requirements for the purposes of this section in respect of credit unions generally or a category of credit unions, the reserve requirements applicable to credit unions under section 85 shall continue to apply generally or to such category of credit unions, as the case may be.

( b ) Where reserve requirements have been prescribed by the Bank for the purposes of this section in respect of credit unions generally or a category of credit unions, then section 85 shall cease to apply generally to that category of credit unions, as the case may be, in respect of the matters so prescribed. ]

Annotations:

Amendments:

F69

Substituted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 13, S.I. No. 584 of 2015.

Savings protection scheme.

46

46.F70 [ ]

Annotations:

Amendments:

F70

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 32, S.I. No. 393 of 2013.

Editorial Notes:

E34

Previous affecting provision: subs. (1) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 24, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; section deleted as per F-note above.

Insurance against fraud of officers etc.

47

47. (1) A credit union shall at all times maintain in force, in respect of each financial year, a policy of insurance which complies with any prescribed requirements and which insures the credit union in respect of loss suffered or liability incurred by reason of the fraud or other dishonesty of its officers F71 [ ].

(2) F72 [ ]

(3) F73 [ ]

Annotations:

Amendments:

F71

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 33, S.I. No. 393 of 2013.

F72

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 34, S.I. No. 280 of 2013.

F73

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 35, S.I. No. 393 of 2013.

Editorial Notes:

E35

Previous affecting provision: subs. (3) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 25, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; subsection deleted as per F-note above.

Provision of additional services to members

Power to provide additional services.

48

48. F74 [ (1) Subject to the following provisions of this Part, a credit union may provide, as principal or agent, additional services of a description that appears to the credit union and to the Bank, to be of mutual benefit to its members. ]

F75 [ (2) In this section and the following provisions of this Part additional services , in relation to a credit union, means any services other than those

( a ) for which provision is made by the preceding provisions of this Part, or

( b ) which are being prescribed for the purposes of this section as being services of a description that appears to the Bank to be of mutual benefit to its members,

and regulations made by the Bank for the purposes of paragraph ( b ) may make the exclusion of any services from being additional services conditional on compliance with such conditions as may be prescribed by the Bank. ]

(3) Nothing in this section or the following provisions of this Part affects the operation of any enactment which is not contained in this Act and which, in whole or in part, relates to the provision of financial or other services of any description.

(4) In order to enable a credit union to provide additional services of any description—

F76 [ ( a ) the credit union must adopt a decision to provide additional services of that description by a resolution passed by not less than two-thirds of the members present and voting at an annual general meeting or at a special general meeting called for the purpose of considering the resolution, or the credit union must adopt a decision to provide additional services of that description by a resolution of the board of directors; ]

( b) the provision of the services must be approved by the F77 [ Bank ] in accordance with section 49 and the services must be provided in accordance with the terms and conditions of the approval; and

( c) the rules of the credit union must specify the provision of services of that description among the objects of the credit union.

(5) Notice shall be given of a resolution under subsection (4)(a) in accordance with the rules of the credit union or, if the rules do not make special provision as to notice of such a resolution, the like notice shall be given as is required by the rules for a resolution to amend the rules; and notice of the resolution shall contain or be accompanied by a statement giving—

( a) a description of the services which it is proposed to provide;

( b) an assessment of the financial and other implications for the credit union of the provision of those services; and

( c) details of such other matters as the F77 [ Bank ] may by notice in writing require to be brought to the attention of the members of the credit union concerned.

(6) Before giving notice of a resolution as mentioned in subsection (5), a credit union shall consult the F77 [ Bank ] and the F77 [ Bank ] shall give a preliminary view as to whether and to what extent the provision of the service would be likely to be approved by F77 [ it ]; but the giving of such a preliminary view shall not prejudice the decision of the F77 [ Bank ] under section 49 (3) .

F78 [ (7) The Bank may specify in writing such requirements as it considers necessary for credit unions providing additional services; and different requirements may be so specified in relation to different descriptions of additional services and apply to different classes of credit unions. ]

F79 [ (8) A credit union shall not be able or, as the case may be, shall cease to be able to provide additional services of a description to which requirements under subsection (7) apply if

( a ) the credit union does not satisfy those requirements, or

( b ) within the period of 12 months beginning on the date on which approval for the provision of the services is given under section 49, the credit union does not begin to provide those services;

but, if a credit union ceases to comply with any of those requirements, the cessation shall not, of itself, impose an obligation on the credit union to dispose of any property or right acquired in connection with the provision of the additional services concerned. ]

Annotations:

Amendments:

F74

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 36, S.I. No. 393 of 2013.

F75

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 37, S.I. No. 393 of 2013.

F76

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 38, S.I. No. 393 of 2013.

F77

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 26, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F78

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 39, S.I. No. 393 of 2013.

F79

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 40, S.I. No. 393 of 2013.

Editorial Notes:

E36

Previous affecting provision: subss. (1), (2), (4)(a) and (7) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 26, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-notes above.

The Registrar’s approval of provision of additional services.

49

49. (1) An application by a credit union for the approval of the provision of additional services of any description (in this section referred to as an “ approval application”) shall be made to the F80 [ Bank ] in such manner as F80 [ it ] may by rules direct, and shall be accompanied by such information as may be so specified.

(2) Without prejudice to the generality of the powers of the F80 [ Bank ] under subsection (1), an approval application shall include information about—

( a) the protection of members for whom the services are to be provided from conflicts of interest that might otherwise arise in connection with the provision of the services;

( b) the provision proposed for securing that adequate compensation is available to those members in respect of negligence, fraud or other dishonesty on the part of officers F81 [ ] of the credit union in connection with the provision of the services;

( c) the extent to which and the manner in which the provision of the services will require the involvement of persons with particular qualifications or experience;

( d) the cost of providing the services;

( e) the income expected to accrue from any charges made for the services; and

( f) the credit union’s proposed principal, in a case where the approval application relates to the provision of services by the credit union as agent for another;

and, where an approval application relates to the provision of additional services of more than one description, the information referred to above shall be given separately in respect of each description of services.

(3) Having considered an approval application (which complies with subsections (1) and (2)), the F80 [ Bank ] shall give notice, either—

( a) granting approval;

( b) refusing to grant approval; or

( c) granting approval subject to whatever conditions (including restrictions or exclusions) F80 [ it ] considers appropriate;

and the F80 [ Bank ] shall not grant an approval application in respect of any description of additional services unless F80 [ it ] is satisfied that the resolution required by section 48 (4) (a) in relation to services of that description has been passed.

(4) In making F80 [ its ] decision on an approval application, the F80 [ Bank ] shall have regard to the interests of the public and of the members and creditors of the credit union, to the orderly and proper regulation of the business of the credit union and to such other considerations as F80 [ it ] thinks proper.

(5) Subject to subsection (6), within four months of the date on which F80 [ it ] receives an approval application, the F80 [ Bank ] shall either notify the credit union of F80 [ its ] decision on the application or require the credit union to supply to F80 [ it ] such additional information as F80 [ it ] considers necessary to enable F80 [ it ] to reach a decision and, where the F80 [ Bank ] requires the provision of such additional information, F80 [ it ] shall notify the credit union of F80 [ its ] decision on the approval application not later than four months from the date of F80 [ its ] receipt of that additional information.

(6) Where an approval application relates to the provision of services by the credit union as agent (and not also as principal), subsection (5) shall have effect with the substitution for any reference to four months of a reference to two months.

(7) Without prejudice to the generality of subsection (3)(c), the conditions which the F80 [ Bank ] may impose in granting an approval application may, in particular, include provisions about—

( a) the amount of funds that may be applied by the credit union to the services;

( b) whether the credit union may act as principal or agent in providing the services;

( c) the period during which the services may be provided;

( d) limits on any guarantees, bonds, contracts of suretyship or indemnities given or entered into by the credit union;

( e) whether and to what extent the approval of the F80 [ Bank ] is to be obtained in respect of particular proposals;

( f) the qualifications required to be held by officers F82 [ ] of the credit union providing the services;

( g) the avoidance of conflicts of interest;

( h) the charges to be made in relation to the provision of any services;

( i) the preparation of accounts in respect of services being provided;

and different conditions may be so imposed in relation to different descriptions of additional services.

(8) F83 [ ]

Annotations:

Amendments:

F80

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 27, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F81

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 41, S.I. No. 393 of 2013.

F82

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 42, S.I. No. 393 of 2013.

F83

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 43, S.I. No. 393 of 2013.

Supplementary provisions as to Registrar’s functions.

50

50. (1) In the exercise of F84 [ its ] powers under sections 48 and 49 and this section, the F84 [ Bank ] may at any time consult the Advisory Committee and such other bodies as appear to F84 [ it ] to be expert or knowledgeable in matters relating to credit unions.

(2) Without prejudice to the generality of subsection (1), the F84 [ Bank ] may commission an independent assessment of the capacity of a credit union to provide any or each description of the additional services in respect of which it has made an approval application; and, if the F84 [ Bank ] so directs, the credit union shall defray the costs of such an assessment.

(3) If it appears to F84 [ it ] appropriate to do so, the F84 [ Bank ] may at any time by notice—

( a) withdraw an approval granted under section 49 ;

( b) revoke or vary any conditions imposed on such an approval; or

( c) impose new conditions on such an approval;

but any such action by the F84 [ Bank ] shall not require the disposal of any property or right already acquired.

(4) In this section “ approval application” has the same meaning as in section 49 .

Annotations:

Amendments:

F84

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 28, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Requirements applicable to credit unions providing additional services.

51

51. (1) A credit union shall not make or offer to make a loan to a member subject to a condition that any additional services which the member may require (whether or not in connection with the loan) shall be provided by (or through the agency or assistance of) the credit union.

(2) Where, in connection with a loan by a credit union, any additional services are made available by a credit union, the credit union shall not make those services available except on terms which distinguish the consideration applicable to each service which is so made available.

52

F85 [ Appeal against certain decisions of Bank.

F86 [ 52. The following decisions are appealable decisions for the purposes of Part VIIA of the Central Bank Act 1942 :

( a ) a decision by the Bank under section 6A for the purposes of subsection (1) or (2) of that section;

( b ) a decision by the Bank under section 11(5) to direct a credit union to change its name to a name approved by the Bank;

( c ) a decision by the Bank under section 41(5) to direct a credit union to dispose of the interest to which the direction relates;

( d ) a decision by the Bank under section 49(3)(b) to refuse to grant approval;

( e ) a decision by the Bank under section 50(3)(a) to withdraw an approval granted under section 49;

( f ) a decision by the Bank under section 50(3)(b) to vary any condition imposed on such an approval;

( g ) a decision by the Bank to impose any condition on such an approval (whether at the time the approval is granted or later by virtue of section 50(3)(c) );

( h ) a decision by the Bank to give a regulatory direction under subsection (1) or (2) of section 87 . ] ]

Annotations:

Amendments:

F85

Substituted (1.08.2004) by Central Bank and Financial Services Authority of Ireland Act 2004 (21/2004), s. 10(2) and sch. 1 pt. 7 item 4, S.I. No. 455 of 2004.

F86

Substituted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 14, S.I. No. 280 of 2013.

Editorial Notes:

E37

Previous affecting provision: section amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 29, S.I. No. 160 of 2003, subject to saver in s. 36 and sch. 3 para. 26; substituted as per F-note above.

PART IV

Management of Credit Unions

Directors

Board of directors.

53

F87 [ 53. (1) A credit union shall have a board of directors which shall have responsibility for the general control, direction and management of the credit union.

(2) The board of directors of a credit union shall be of sufficient number and expertise to adequately oversee the operations of the credit union.

(3) Except in the circumstances set out in subsection (4) , the number of directors shall be specified in the registered rules as set out in section 13 and shall be

( a ) not less than 7,

( b ) not more than 11, and

( c ) an odd number.

(4) The number of directors of a credit union may be more than 11 or may be an even number if an additional director is appointed under section 95A .

(5) Each director of a credit union shall ensure that he or she has sufficient time to devote to the role of director and the responsibilities associated with that role as indicated by the nomination committee under section 56B(4)(g) .

(6) The board of directors of a credit union shall be elected

( a ) where the organisation meeting occurs after the commencement of this provision (as amended by section 15 of the Credit Union and Co-operation with Overseas Regulators Act 2012), by secret ballot at the organisation meeting and, subject to subsection (15) and section 57 , subsequent vacancies on the board of directors shall be filled by secret ballot at an annual general meeting, and

( b ) in any other case, by secret ballot at the annual general meeting first occurring after the commencement of this provision (as amended by section 15 of the Credit Union and Co-operation with Overseas Regulators Act 2012) or, if earlier than that annual general meeting, at a special general meeting called for the purpose of such ballot and, subject to subsection (15) and section 57 , subsequent vacancies on the board of directors shall be filled by secret ballot at an annual general meeting.

(7) The term of office of a director of a credit union

( a ) shall begin at the conclusion of the general meeting at which the director is elected,

( b ) shall not extend beyond the third subsequent annual general meeting after his or her election, and

( c ) subject to paragraph (b) , subsections (8) and (12) and all other applicable requirements of financial services legislation, shall be determined in accordance with the registered rules,

but, except where this Act or any other applicable requirement of financial services legislation or the registered rules otherwise provides, a retiring director shall be eligible for re-election.

(8) At each annual general meeting of a credit union the number of directors whose term of office expires shall, as near as possible, be the same.

(9) Only a natural person of full age may be a director of a credit union.

(10) The following persons are not eligible to become a director of a credit union:

( a ) an employee or voluntary assistant of the credit union or an employee of any other credit union;

( b ) a member of the board oversight committee of the credit union;

( c ) a director of any other credit union;

( d ) an employee of a representative body of which the credit union is a member, where that employee s role could expose them to a potential conflict of interest;

( e ) a public servant (within the meaning of the Financial Emergency Measures in the Public Interest Act 2009 ) assigned to the Department of Finance and involved in advising the Minister on credit union issues or in the examination of credit union issues;

( f ) a member of the Commission of the Bank;

( g ) an officer (within the meaning of section 2 of the Central Bank Act 1942 ) or other employee of the Bank and who is involved in the regulation of credit unions;

( h ) the Financial Services Ombudsman (within the meaning of section 2 of the Central Bank Act 1942 ) or a Bureau staff member (within the meaning of section 57BA of that Act);

( i ) a member of the Irish Financial Services Appeals Tribunal or a member of its staff (including the Registrar of the Appeals Tribunal appointed under section 57J of the Central Bank Act 1942 );

( j ) the chief executive of the National Consumer Agency, an authorised officer of that Agency (within the meaning of section 2 of the Consumer Protection Act 2007 ) or any other member of its staff;

( k ) the auditor of the credit union or a person employed or engaged by that auditor;

( l ) a solicitor or other professional adviser who has been engaged by or on behalf of the credit union within the previous 3 years;

( m ) a person who is a spouse or civil partner, parent, sibling or child of a director, board oversight committee member or employee of that credit union.

(11) A person shall resign from being a director of a credit union if and when he or she becomes a person to whom any provision of subsection (10) relates.

(12) A member of a credit union may not be appointed or elected to the board of directors if he or she has served for more than 12 years in aggregate in the previous 15 years on either the board of directors or the board oversight committee of the credit union.

(13) For directors of a credit union or members of the board oversight committee who were already directors or members of the board oversight committee on the date of the commencement of this section in respect of such credit union, the 12 year period set out in subsection (12) commences on the date this subsection so commences.

(14) Directors of a credit union may not serve more than 3 consecutive years in any one principal post (as referred to in section 63 ) and a person who has been the holder of such a principal post shall not be eligible for re-election thereto until after the expiry of one year since he or she last held it.

(15) Subject to the requirements set out in this section and all other applicable requirements of financial services legislation, the board of directors may at any time and from time to time appoint a member of the credit union (including a former director) to be a director to fill a casual vacancy.

(16) A director appointed under subsection (15) shall hold office from the date of the appointment to the next following annual general meeting of the credit union or, if it is earlier, the next special general meeting at which an election is held for directors of the board of directors.

(17) Where all the directors of a credit union intend to resign on the same date, the secretary shall give written notice of the directors intention to the Bank and the board oversight committee. ]

Annotations:

Amendments:

F87

Substituted (3.03.2014) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 15(1), S.I. No. 99 of 2014.

Modifications (not altering text):

C7

Reference to “Financial Services Ombudsman” in subs. (10)(h) construed (1.01.2018) by Financial Services and Pensions Ombudsman Act 2017 (22/2017), s. 29(3), S.I. No. 524 of 2017.

References in enactments

29. ...

(3) References to the Financial Services Ombudsman, the Deputy Financial Services Ombudsman or the Pensions Ombudsman in any enactment (other than this Act) or any instrument made under such an enactment shall, on and after the establishment day, be construed as references to the Ombudsman.

C8

References to “National Consumer Agency” and “chief executive of the National Consumer Agency” construed (31.10.2014) by Competition and Consumer Protection Act 2014 (29/2014), s. 39(2), S.I. No. 367 of 2014.

Transfer of functions to Commission

39....

(2) References in any Act of the Oireachtas passed before the establishment day or in any instrument made before that day under an Act of the Oireachtas to—

(a) the National Consumer Agency, or ...

shall, on and after that day, be construed as references to the Commission.

(3) A reference in any Act of the Oireachtas passed before the establishment day or in any instrument made before that day under an Act of the Oireachtas to the chief executive of the National Consumer Agency shall, on and after that day, be construed as a reference to the chairperson of the Commission.

(4) This section shall come into operation on the establishment day.

Directors: procedural provisions.

54

F88 [ 54. (1) The board of directors of a credit union shall meet as often as may be appropriate to fulfil its responsibilities effectively and prudently and reflecting the nature, scale and complexity of the credit union, but in any event

( a ) the board of directors shall hold at least 10 meetings in any year, and

( b ) the interval between any 2 meetings of the board of directors shall not be greater than 6 weeks.

(2) Meetings of the board of directors of a credit union shall be chaired by the chair or, in his or her absence, by the vice-chair or, in the absence of the chair and the vice-chair, in a manner prescribed by the Bank or, if no manner is so prescribed, in a manner provided for in the rules of the credit union.

(3) The secretary of a credit union shall keep minutes of all meetings of the board of directors.

(4) Subject to subsection (10) , the chair shall cause a detailed agenda of items for consideration and discussion to be prepared by the secretary of the credit union for each meeting of the board of directors.

(5) The secretary of the credit union shall cause the detailed agenda and proposed minutes of the previous meeting of the board of directors to be circulated sufficiently in advance of each board of directors meeting to allow all directors adequate time to consider them. Where necessary, sufficient and clear supporting information and papers shall also be so circulated.

(6) Nothing in subsection (4) or (5) shall be read as preventing discussion or consideration of any matter urgently arising that is not included in the detailed agenda but any such matter shall, without prejudice to subsection (7) , be recorded in the minutes of the meeting concerned and, where appropriate or the board of the credit union so directs, clear supporting information and papers relating to the matter so arising shall be circulated as soon as practicable in the circumstances.

(7) Minutes of all meetings of the board of directors shall

( a ) be prepared with all decisions, discussions and points for further action being documented,

( b ) record all dissensions or minority votes in terms acceptable to the dissenting person or minority voter, and

( c ) provide sufficient detail to identify the nature and extent of the discussion on any matter and the decision or other outcome.

(8) All discussions at board of directors meetings relating to conflicts of interest (whether of board members or otherwise) shall be recorded in sufficient detail in the minutes of the meeting concerned, together with a record of any action taken or proposed to be taken.

(9) The minutes of each meeting of the board of directors shall be motioned for agreement and approval at the next subsequent meeting of the board of directors. Those minutes shall be so approved or approved subject to such qualifications and modifications as may be made to them at that subsequent meeting. Any such modification or qualification shall also be minuted in the minutes of that subsequent meeting.

(10) In causing the agenda for a meeting of directors of a credit union to be prepared, the chair shall endeavour to ensure that adequate and sufficient time is provisionally allocated to all material relevant matters for discussion.

(11) Directors of the board of directors shall attend every meeting of the board of directors unless they are unable to attend due to circumstances beyond their control.

(12) The extent of the attendance of each board member at meetings of the board of directors shall be recorded in the minutes for the meeting concerned. ]

Annotations:

Amendments:

F88

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 16, S.I. No. 393 of 2013.

Editorial Notes:

E38

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 30, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Functions of board of directors.

55

F89 [ 55. (1) Without prejudice to the generality of section 53(1) , the functions of the board of directors of a credit union shall include the following:

( a ) setting the strategy for the credit union by preparing, including active participation and examination of strategies being developed or proposed by the manager, management team or others and preparing and adopting a strategic plan;

( b ) monitoring the implementation of the strategic plan by the credit union, reviewing the performance of the credit union against the measurements defined in the strategic plan and assessing, on a regular basis but at least annually, how the strategic objectives of the credit union are being achieved;

( c ) reviewing the credit union s strategic plan on a regular basis, but at least annually, to ensure that it remains relevant and up to date and modifying or revising the strategic plan to incorporate any changes required as a result of the review;

( d ) operating a comprehensive decision-making process, considering all matters it considers to be of material relevance to the credit union and documenting the reasons for its decisions;

( e ) the appointment of a manager, risk management officer and compliance officer and the approval of the appointment of any other member of the management team;

( f ) ensuring that there is an effective management team in place;

( g ) reviewing the performance of the manager on an annual basis and monitoring on an ongoing basis his or her continued appropriateness to be the manager;

( h ) ensuring that the performance of every other employee and voluntary assistant, is reviewed and monitored on an ongoing basis to ensure his or her continued appropriateness for his or her role in the credit union;

( i ) identifying, in consultation with the manager, other officer positions within the credit union that

(i) are essential to the proper management of the credit union,

(ii) are likely to enable the person holding the position to exercise significant influence on the conduct of the affairs of the credit union,

and which, together with the manager and risk management officer of the credit union are referred to in this Act as the management team ;

( j ) ensuring there is an appropriate succession plan in place in respect of each of the positions that constitute the management team;

( k ) exercising appropriate oversight over execution by the management team of the agreed strategies, goals and objectives;

( l ) reviewing and approving all elements of the risk management system on a regular basis, but at least annually and, in particular

(i) assessing the appropriateness of the risk management system,

(ii) taking account of any changes to the strategic plan including the credit union s resources or the external environment, and

(iii) taking measures necessary to address any deficiencies identified in the risk management system;

( m ) ensuring compliance with all requirements imposed on the credit union by or under the Credit Union Acts 1997 to 2012 or any other financial services legislation;

( n ) the removal from office of an officer of the credit union, except directors or members of the board oversight committee, where the board of directors has duly determined that there has been a failure by the person concerned to perform duties or responsibilities;

( o ) approving, reviewing, and updating, where necessary, but at least annually, all plans, policies and procedures of the credit union, including the following:

(i) lending policies including lending limits;

(ii) policies in relation to members shares and deposits including the setting of a maximum number of shares a member can hold and a maximum amount that a member may deposit;

(iii) liquidity management policies;

(iv) reserve management policies;

(v) investment policies;

(vi) the designating of depositories for the funds of the credit union and signatories to cheques, drafts or similar documents drawn on the credit union;

(vii) standards of conduct and ethical behaviour for officers;

(viii) remuneration policies and practices;

(ix) compliance plan and policies;

(x) records management policies;

(xi) information systems and management information policies;

(xii) business continuity plan;

(xiii) asset and liability management policies;

(xiv) outsourcing policies;

(xv) risk management policy;

(xvi) conflicts of interest policy;

(xvii) such other matters as the Bank may prescribe;

( p ) the recommendation to members, for approval, of dividends to members;

( q ) ensuring the accounts of the credit union are submitted for audit;

( r ) reporting to the members of the credit union at the annual general meeting, including nominating a member of the board to present the annual accounts at the annual general meeting;

( s ) reviewing and considering any update of financial statements provided to the board by the manager under section 63A(4)(c) .

(2) In deciding on the roles, responsibilities and administrative structures and reporting relationships of all officers, the board of directors of a credit union shall ensure that no single person is responsible for making all of the material decisions of the credit union or has effective control over the business of the credit union.

(3) The board of directors shall implement a risk management process that ensures that all significant risks are identified and mitigated to a level consistent with the risk tolerance of the credit union.

(4) The board of directors shall carry out at least annually a comprehensive review of its overall performance, relative to its objectives and implement any necessary changes or improvements.

(5) The review carried out by the board of directors under subsection (4) shall be documented in writing.

(6) In respect of the exercise of functions by the board of directors of a credit union, the board shall set out in writing a register of matters or categories of matters that require the board s approval and which cannot be assigned by the board to other persons for performance on the board s behalf. The register shall be used to record all such approvals by the board of directors.

(7) Where the board of directors causes any matter relating to its functions to be performed or carried out on its behalf, it shall continue to have responsibility for the matter.

(8) The board shall regularly review, but at least annually, the performance and effectiveness of the internal audit function, including reviewing and approving the internal audit charter and the internal audit plan and reviewing and approving any modifications to them, ensuring they are updated and that any issues identified in the review are managed and rectified in a timely manner. ]

Annotations:

Amendments:

F89

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 17, S.I. No. 393 of 2013.

55A

F90 [ Chair of board of directors, etc.

55A. (1) The board of directors of a credit union shall elect one of its number to be the chair of the board, subject to that person being eligible to be chair of a board of directors.

(2) The chair of the board of directors of a credit union may be referred to by whatever title the rules of the credit union provide.

(3) The functions of the chair of a credit union include the following:

( a ) ensuring that meetings of the board of directors operate in an efficient and effective manner;

( b ) encouraging constructive discussions and debate at board of directors meetings;

( c ) promoting effective communications between members of the board of directors and between the board of directors and the management team of the credit union;

( d ) causing the agenda to be set by the secretary, attending and chairing board of directors meetings;

( e ) ensuring that the responsibilities of the nomination committee, as set out in section 56B(4), are performed by that committee;

( f ) conducting a performance evaluation of each member of the board of directors on an annual basis to ensure that each director is complying with the obligations under financial services legislation and the board of directors objectives as set out in the credit union s strategic plan;

( g ) facilitating the work of the board oversight committee through providing it with all reasonable assistance to enable that committee to carry out its functions;

( h ) ensuring that conflicts of interest are appropriately managed by the board of directors, and by each of them, in accordance with section 69 .

(4) A director of the credit union shall not be eligible to be elected as chair if the director had, at any time during the 5 years preceding the election, been

( a ) an employee of that credit union, or

( b ) a person who acted in any management capacity (whether voluntary or paid) in that credit union,

and, for the purposes of this subsection, acted in any management capacity includes performing a role where the person was in a position to exercise a significant influence on the conduct of the credit union s affairs but does not include acting as a member of the board of directors or as a member of the board oversight committee.

(5) Subject to subsection (7)(a) , the term of office of a chair of a board of directors shall be for the period of one year.

(6) A chair of a board of directors shall not serve more than 4 consecutive terms in that position and, having so served, shall not be eligible to be chair until

( a ) after another director has served at least one term as chair, or

( b ) where such other director has served for less than one year, after 2 or more directors have served as chair for the equivalent of at least one complete term,

but nothing in this section shall prevent a former chair of the board of directors from being selected under section 54(2) from chairing a meeting of the board in the absence of the chair and, where relevant, the vice-chair.

(7) A person shall cease being chair of a board of directors if

( a ) the person ceases being a director for any reason, or

( b ) the person resigns from being chair in accordance with subsection (8) .

(8) A director may resign from being chair of the board of directors by sending his or her resignation in writing to the secretary of the credit union. ]

Annotations:

Amendments:

F90

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 18, S.I. No. 393 of 2013.

Editorial Notes:

E39

The section heading is taken from the amending section in the absence of one included in the amendment.

Removal of director from office.

56

56. (1) Subject to subsection (2), a credit union may, by resolution of a majority of the members present and voting at a special general meeting called for that purpose, remove a director from office.

(2) The secretary shall, not less than 21 days before the date of the special general meeting at which it is proposed to move a resolution referred to in subsection (1), give written notice of the meeting to the director concerned.

(3) Where notice is given of such a resolution as is mentioned in subsection (1) and the director concerned makes in relation to it representations in writing to the credit union (not exceeding a reasonable length) and requests their notification to the members of the credit union, the credit union shall, subject to subsection (5), (unless the representations are received by it too late to do so)—

( a) in any notice of the proposed resolution given to members of the credit union, state the fact of the representations having been made; and

( b) send a copy of the representations to every member of the credit union to whom notice of the meeting is sent (whether before or after the credit union receives the representations).

(4) Subject to subsection (5), and whether or not copies of any representations made by him have been sent as mentioned in subsection (3), the director concerned may require that, without prejudice to his right to be heard orally, the representations made by him shall be read out at the special general meeting.

(5) Subsections (3) and (4) shall not apply if, on the application either of the credit union or of any person who claims to be aggrieved, the F91 [ Bank ] is satisfied that compliance with the subsections would diminish substantially public confidence in the credit union or that the rights conferred by them are being, or are likely to be, abused in order to secure needless publicity for defamatory matter.

F92 [ (6) A vacancy arising from the removal of a director under this section shall be filled in accordance with section 53(15) . ]

Annotations:

Amendments:

F91

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 31, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F92

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 44, S.I. No. 393 of 2013.

56A

F93 [ Board committees.

56A. (1) Subject to the other provisions of the Credit Union Acts 1997 to 2012 and any matter prescribed by the Bank, the board of directors of a credit union may cause any matter relating to its functions to be performed or carried out on its behalf by a committee, comprised entirely of directors or of a majority of directors, to act on behalf of the board of directors in respect of matters to be performed or carried out.

(2) A decision of the board of directors to cause any matter relating to its functions to be performed or carried out on its behalf under subsection (1) shall be taken at a meeting of the board.

(3) The Bank may prescribe that credit unions generally or any category or categories of credit union establish one or more of the following committees, all members of which shall be directors of the credit union:

( a ) an audit committee;

( b ) a risk committee;

( c ) a remuneration committee.

(4) Where a credit union is not required to establish a committee to which subsection (3) relates, the credit union

( a ) if such a committee is already in place when this section is first commenced, shall as soon as practicable thereafter decide whether or not the committee shall continue, or

( b ) at any time after such commencement, it may decide voluntarily to establish such a committee if it considers it appropriate and proportionate to do so,

and the provisions of this section shall apply to the credit union, in respect of the committee so continued or established as if that committee were required to be established under subsection (3) .

(5) A decision by the board of directors under subsection (1) shall be documented in writing by the board, which documentation shall include

( a ) the terms of reference for the committee including

(i) identifying the subject matter of the area concerned and respective responsibilities of both the board of directors and the committee,

(ii) identifying the matters that may be decided by the committee and those that require the approval of the board,

(iii) a schedule of matters reserved for the board of directors that would otherwise be performed or carried out by the committee,

and

( b ) the procedures for monitoring and documenting in writing the exercise of the matters to be carried out on behalf of the board.

(6) The board of directors shall appoint the members of each committee to which subsection (1) relates.

(7) A person appointed to a committee

( a ) shall hold office until the next general meeting at which an election is held for the board of directors, or such shorter period as may be specified at the time the person is appointed to the committee, and

( b ) may be removed from the committee by a decision of the board of directors.

(8) When appointing members of a committee to which subsection (1) relates, the board of directors of a credit union shall ensure that

( a ) each committee has an appropriate balance and sufficiency of skills and expertise available to it to carry out the matters delegated to it, and

( b ) where necessary, some or all of the members of the committee are prepared to undertake relevant training to enhance their skills and experience for the purpose of carrying out functions in the context of paragraph (a) .

(9) For the purposes of a committee to which subsection (1) relates, the board of directors or, failing them, the committee concerned in consultation with the secretary of the credit union, shall appoint a secretary to the committee. The secretary to a committee shall perform the same functions to the committee as does the secretary to the credit union perform under subsections (3) , (5) , (7) and (8) of section 54.

(10) The members of a committee to which subsection (1) relates shall perform their functions as such members in a manner consistent with the exercise of functions by members of the board of the credit union, both collectively and individually, as if the committee were the board and accordingly, the provisions of section 54 , other than subsection (1) , that relate to the board shall, subject to any necessary modifications, apply to the committee.

(11) A committee to which subsection (1) relates shall be chaired in such manner as its terms of reference provide or, where not so provided, as the committee shall decide.

(12) The board of directors of a credit union

( a ) may establish such other committees as the directors consider appropriate, and

( b ) shall have such other committees (if any) as may be prescribed by the Bank.

(13) In composing the membership of any committee under this section, the board of directors of a credit union shall endeavour to ensure that no one individual director is in a position to exercise excessive influence or control, in respect of the business affairs of the credit union, through membership of committees.

(14) Each committee shall, at least quarterly in every year, prepare and submit in writing to the board of directors a formal report on its activities and deliberations. ]

Annotations:

Amendments:

F93

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 19, S.I. No. 393 of 2013.

Editorial Notes:

E40

The section heading is taken from the amending section in the absence of one included in the amendment.

56B

F94 [ Nomination committee.

56B. (1) The board of directors of a credit union shall establish a committee (in this Act referred to as the nomination Committee ) whose members shall be elected in accordance with subsection (13) .

(2) The nomination committee shall comprise not less than 3 members and not more than 5 members.

(3) Only members of the board of directors of a credit union are eligible to serve on a nomination committee of the credit union.

(4) The nomination committee shall be responsible for the following:

( a ) identifying candidates to be nominated for appointment to the board of directors;

( b ) accepting nominations of candidates proposed to be appointed to the board of directors;

( c ) proposing

(i) candidates, for election by a general meeting, to be members of the board, and

(ii) if prescribed by the Bank for the purposes of section 53(15) , at least such and so many candidates as may be required for consideration for appointment to fill vacancies on the board of directors;

( d ) proposing an additional person to be a director of the credit union pursuant to section 95A(1) ;

( e ) assisting the credit union in performing anyobligations of the credit union under section 23 of the Central Bank Reform Act 2010 in relation to any candidates proposed to perform pre-approval controlled functions (as construed in accordance with section 22 of that Act);

( f ) assisting the credit union in carrying out any checks which the credit union is undertaking to enable it to comply with its obligations under section 21 of the Central Bank Reform Act 2010 ;

( g ) informing each prospective candidate by notice in writing, before he or she is proposed as a candidate in accordance with paragraph (c) , of the time commitment expected from him or her in respect of his or her role as a director;

( h ) ensuring that there is an appropriate succession plan in place for the board of directors;

( i ) ensuring that each director is given adequate induction to his or her role on the board of directors so as to ensure he or she has sufficient appreciation of, and appropriate training about, the strategy, operations and performance of the credit union;

( j ) ensuring that the induction process and training referred to in paragraph (i) occurs as soon as is practicable and in any event by no later than 6 months following a director s appointment to the board of directors;

( k ) arranging additional training, either individually or collectively, for the members of the board of directors during their respective terms of appointment to the extent that the nomination committee considers it necessary in order for the board of directors to make informed decisions;

( l ) maintaining a record in writing of the periods of time during which a person has served as a member of the board of directors of the credit union.

(5) Every candidate to be nominated for appointment as a member of the board of directors of a credit union shall be proposed through the nomination committee of the credit union. No person shall otherwise be put forward for election or seek election at an annual general meeting or special general meeting of the credit union at which an election is held for members of the board of directors.

(6) The nomination committee shall ensure it receives nominations for appointment of persons as members of the board of directors of a credit union in time prior to any annual general meeting, or special general meeting at which an election is held for such members, so as to enable any requirements by or under Part 3 of the Central Bank Reform Act 2010 to be met in advance of those persons being nominated for appointment.

(7) In identifying prospective candidates under subsection (4)(a) and considering the proposing of candidates under subsection (4)(c) , the nomination committee shall consider the balance of skills, experience and knowledge on the current board of directors and any review undertaken under subsection (11) .

(8) In considering the proposing of candidates under paragraph (4)(c) , the nomination committee shall have regard to

( a ) the number of directors on the board of directors and the number of vacancies to be filled,

( b ) whether potential conflicts of interest could arise from the appointment to the board of directors of a person if such person were duly nominated and appointed to the board, and

( c ) any other matter that the Bank may prescribe.

(9) Any potential conflict referred to in subsection (8) shall be brought to the attention of

( a ) where subsection (4)(c)(i) is relevant, the members of the credit union at the general meeting concerned, and

( b ) where subsection (4)(c)(ii) is relevant, the directors of the board of directors of the credit union at the meeting of the board concerned.

(10) The nomination committee shall not propose appointments to the board of directors or allow appointments to proceed where conflicts of interest exist or could arise in a way which in its opinion could significantly affect the ability of the board of directors to operate in accordance with section 69(1) .

(11) The nomination committee shall review the composition of the board of directors at least once a year for the purpose of identifying any deficiencies in the composition of the board. The review shall include determining whether or not there are any deficiencies in the balance of skills amongst the members of the board of directors and considering other matters relating to deficiencies that may be prescribed by the Bank.

(12) The nomination committee shall

( a ) formally review the membership of any person who is a member of the board of directors for more than the 12 years in aggregate permitted under this Part, and

( b ) shall document the rationale for the continuance of such membership of that person.

(13) ( a ) At a meeting of the board of directors of a credit union

(i) which is held immediately after the organisation meeting, an annual general meeting or special general meeting at which an election is held for members of the board of directors, and

(ii) which is chaired by a member of the board oversight committee,

the board shall elect by secret ballot directors to fill such positions as are then vacant on the nomination committee.

( b ) In the event of a casual vacancy on the nomination committee, the board of directors may by secret ballot elect a director to fill that vacancy until the next meeting at which, in accordance with paragraph (a) , an election should be held to fill any vacancy in the nomination committee. ]

Annotations:

Amendments:

F94

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 20, S.I. No. 393 of 2013.

Editorial Notes:

E41

The section heading is taken from the amending section in the absence of one included in the amendment.

Directors: supplemental provisions.

57

57. (1) A register of directors shall be kept by the secretary of the credit union and signed by all the directors of a credit union each year after the annual general meeting of a credit union or, in the case of a director appointed to fill a casual vacancy, after his appointment.

F95 [ (2) In the event that the number of directors of a credit union falls to less than half the number specified in the registered rules, the secretary of the credit union shall forthwith notify the Bank and the board oversight committee of the credit union. ]

(3) The acts of a director of a credit union shall be valid notwithstanding any defect in the appointment of the director which may be subsequently discovered.

F96 [ (4) Where any of the following events occurs

( a ) the secretary of the credit union has given notice under section 53(17) that all the directors of the credit union intend to resign on the same date,

( b ) all the directors have been removed or suspended in accordance with section 96(1) , or

( c ) there is no board of directors,

then the board oversight committee shall convene a special general meeting of the credit union, within one month of the occurrence of the event in question, to elect a board of directors. ]

(5) If the special general meeting referred to in subsection (4) is not convened in accordance with the provisions of that subsection, the F97 [ Bank ] may convene such a special general meeting under section 92 (1)(b) .

Annotations:

Amendments:

F95

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 sch. 1 item 45, S.I. No. 393 of 2013.

F96

Substituted (3.03.2014) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 sch. 1 item 46, S.I. No. 99 of 2014.

F97

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 32, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Editorial Notes:

E42

Previous affecting provision: subs. (2) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 32, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Supervisory Committee

Supervisory Committee.

58

58. F98 [ ]

Annotations:

Amendments:

F98

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 47, S.I. No. 393 of 2013, subject to transitional provision in s. 27(2).

Supervisory Committee: procedural provisions.

59

59. F99 [ ]

Annotations:

Amendments:

F99

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 47, S.I. No. 393 of 2013, subject to transitional provision in s. 27(2).

Editorial Notes:

E43

Previous affecting provision: section amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 33, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; repealed as per F-note above.

Functions of Supervisory Committee.

60

60. F100 [ ]

Annotations:

Amendments:

F100

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 47, S.I. No. 393 of 2013, subject to transitional provision in s. 27(2).

Supervisory Committee: removal from office.

61

61. F101 [ ]

Annotations:

Amendments:

F101

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 47, S.I. No. 393 of 2013, subject to transitional provision in s. 27(2).

Editorial Notes:

E44

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 34, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; repealed as per F-note above.

Supervisory Committee: supplemental provisions.

62

62. F102 [ ]

Annotations:

Amendments:

F102

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 47, S.I. No. 393 of 2013, subject to transitional provision in s. 27(2).

Editorial Notes:

E45

Previous affecting provision: section amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 35, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; repealed as per F-note above.

Officers

Officers: principal posts.

63

63. F103 [ (1) At a meeting of the board of directors of a credit union

( a ) which is held immediately after the organisation meeting, an annual general meeting or special general meeting at which an election is held for members of the board of directors, and

( b ) which is chaired by a member of the board oversight committee,

the board of directors shall elect by secret ballot directors to fill such of the principal posts in the credit union as are then vacant; and, for the purposes of this section, the principal posts in a credit union are the posts of chair, vice-chair and secretary. ]

(2) F104 [ ]

(3) In the event of a casual vacancy in a principal post, the board of directors may by secret ballot elect a director to hold that post until the next meeting at which, in accordance with subsection (1), an election should be held to fill any vacancy in the principal posts.

(4) Without prejudice to subsection (3), if a principal post falls vacant or for any other reason there is no holder of a principal post, anything that is required or authorised to be done by the holder of that post may be done by a director authorised in that behalf by the board of directors.

F105 [ (5) The chair or secretary of a credit union shall notify the Bank in writing of the election, appointment, retirement, removal or resignation from office of chair, vice-chair, director, secretary, or committee member and the notification shall

( a ) be made within 14 days of the election, appointment, retirement, removal or resignation, and

( b ) state the full name and address of the officer concerned. ]

(6) F106 [ ]

Annotations:

Amendments:

F103

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 48, S.I. No. 393 of 2013.

F104

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 49, S.I. No. 393 of 2013.

F105

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 50, S.I. No. 393 of 2013.

F106

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 51, S.I. No. 280 of 2013.

Editorial Notes:

E46

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 36, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

63A

F107 [ Manager of credit union.

63A. (1) The board of directors of a credit union shall appoint an individual to the role of manager of the credit union.

(2) The manager of a credit union shall be the chief executive officer of the credit union having responsibility for the day-to-day management of the credit union s operations, compliance and performance and shall be responsible to the board of directors for the performance of his or her functions.

(3) Subject to the Credit Union Acts 1997 to 2012 , any matters which the Bank may prescribe and other financial services legislation, the respective functions of, and the division of responsibilities between, the board of directors and the manager of a credit union shall be clearly established, formally documented in writing and approved by the board of directors.

(4) The functions of the manager of a credit union include the following:

( a ) without prejudice to the exercise by the board of directors of its functions under subsection (1)(a) of section 55 , preparing and proposing to the board of directors for debate, scrutiny and approval, strategies for the strategic plan that the board of directors are required to prepare and approve under that subsection;

( b ) implementing the strategies agreed by the board of directors to the standards set out in the strategic plan or as otherwise required by the board of directors;

( c ) updating the board of directors on the financial position of the credit union, including submitting to the board of directors on a monthly basis unaudited financial statements that set out the financial position of the credit union;

( d ) appointing or causing to be appointed such and so many persons as employees or as voluntary assistants as the manager considers appropriate after consulting with the management team of the credit union;

( e ) preparing or causing to be prepared such financial reports and returns as may be required by the auditor of the credit union;

( f ) implementing the proper systems of internal control which the board of directors have approved;

( g ) ensure that all cash is deposited in accordance with the instructions of the board of directors;

( h ) such other matters as may be duly assigned to the manager by the board of directors.

(5) In appointing a person as manager of a credit union, its board of directors shall ensure that the person complies with all legal requirements (including requirements which the Bank may prescribe) to be appointed. ]

Annotations:

Amendments:

F107

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 21, S.I. No. 393 of 2013.

Editorial Notes:

E47

The section heading is taken from the amending section in the absence of one included in the amendment.

Functions of treasurer.

64

64. F108 [ ]

Annotations:

Amendments:

F108

Repealed (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 sch. 1 item 52, S.I. No. 393 of 2013.

Credit officer and credit control officer.

65

F109 [ 65. (1) The board of directors may

( a ) approve the appointment of a person by the manager, other than a member of the board, a member of the credit control committee or a credit control officer, as a credit officer to work under the supervision of the credit committee, and

( b ) assign to the credit officer the power to approve credit on its behalf

(i) that is fully secured by the shareholding of the borrowing member or to an amount in excess of that shareholding, or

(ii) that qualifies as emergency credit within such definitions and limitations as to amount, the terms of repayment and security required for emergency credit as may be established in writing by the board of directors,

and the amount of the excess referred to in paragraph (b)(i) , shall be determined from time to time by the board of directors.

(2) A record of each application for credit which has or has not been approved shall be furnished by the credit officer to the credit committee not later than 7 days of receipt of the application.

(3) Where the board of directors has assigned the power to approve credit under subsection (1)(b) , a credit officer shall enquire into the character and financial circumstances of an applicant for credit and the security offered, if any, in order to

( a ) ascertain the applicant s ability to repay a loan in accordance with its terms, and

( b ) ensure that the provision of credit does not involve undue risk to members savings.

(4) The Board may approve the appointment of a person by the manager, other than a member of the board, a member of the credit committee or a credit officer, as a credit control officer to assist the credit control committee and work under its supervision and control. ]

Annotations:

Amendments:

F109

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 22, S.I. No. 393 of 2013.

Officers: suspension and removal by Supervisory Committee.

66

F110 [ 66. (1) If the board oversight committee of a credit union considers that a member of the board of directors has taken any action or decision which, in the opinion of the committee, given in writing to the director concerned, is not in accordance with the requirements of this Part, then, after consulting the Bank, the committee may either

( a ) suspend, with immediate effect, the director by a unanimous vote of all the members of the committee taken at a meeting of the committee called for the purpose of considering the director s suspension, or

( b ) convene a special general meeting of the credit union to consider whether to remove the director in light of the action or decision taken by that director,

but no steps shall be taken under this subsection without the director concerned being given an opportunity to be heard by the members of the board oversight committee.

(2) Where a director of a credit union has been suspended by the board oversight committee in accordance with subsection (1) , the board oversight committee shall, within 7 days of that suspension, convene a special general meeting

( a ) for the purpose of reviewing the suspension, and

( b ) to consider whether to remove the director having regard to the action or decision taken by that director.

(3) Where the board oversight committee convenes a special general meeting for the purposes of this section the credit union may, by resolution of a majority of the members present and voting at that special general meeting

( a ) ratify the suspension of the director concerned and remove that director from office,

( b ) rescind the suspension of that director, or

( c ) remove that director from office,

but no director shall be so removed from office without being given an opportunity to be heard by the members present at the meeting.

(4) The secretary of the credit union shall, not less than 21 days before the date of the special general meeting at which it is proposed to move a resolution referred to in subsection (3) , give written notice of that meeting to the director concerned.

(5) Where notice is given of an intended resolution to remove a director under this section and the director concerned makes in relation to it representations (not exceeding a reasonable length) in writing to the credit union and requests their notification to the members of the credit union then, unless the representations are received by it too late for it to do so, the credit union shall, subject to subsection (7)

( a ) in any notice of the resolution given to members of the credit union, state the fact of the representations having been made, and

( b ) send a copy of the representations to every member of the credit union to whom notice of the meeting is sent.

(6) Subject to subsection (7) , and whether or not copies of any representations made by it have been sent as mentioned in subsection (5) , the director concerned may require that, without prejudice to his or her right to be heard orally, the representations made by him or her shall be read out at the special general meeting.

(7) Subsections (5) and (6) shall not apply if, on the application either of the credit union or of any person who claims to be aggrieved, the Bank is satisfied that compliance with the subsections would diminish substantially public confidence in the credit union or that the rights conferred by those sections are being, or are likely to be, abused in order to secure needless publicity for defamatory matter.

(8) Where a director of a credit union is removed from office at a special general meeting pursuant to this section, the vacancy caused by the removal shall be filled in such manner as may be determined by the meeting. ]

Annotations:

Amendments:

F110

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 23, S.I. No. 393 of 2013.

Editorial Notes:

E48

Previous affecting provision: subss. (1) and (3) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 37, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

F111 [ General governance requirements ]

66A

F112 [ Governance arrangements in credit unions.

66A. (1) A credit union shall have governance arrangements which shall

( a ) be such as to ensure that there is effective oversight of the activities of the credit union, taking into consideration the nature, scale and complexity of the business being conducted,

( b ) include a clear organisational structure with well-defined, transparent and consistent reporting lines,

( c ) be documented and set out the roles, responsibilities and accountabilities of the officers clearly in writing,

( d ) be communicated in writing to all officers in the credit union, and

( e ) be subject to regular internal review by the board of directors on, at a minimum, an annual basis.

(2) A credit union shall have in place the oversight, policies, procedures, practices, systems, controls, skills, expertise and reporting arrangements to ensure compliance with the requirements set out in this Part. ]

Annotations:

Amendments:

F112

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 24, S.I. No. 393 of 2013.

66B

F113 [ Remuneration policies and practices.

66B. A credit union shall put in place remuneration policies and practices which shall be consistent with and promote sound and effective risk management. ]

Annotations:

Amendments:

F113

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 24, S.I. No. 393 of 2013.

66C

F114 [ Reporting to Bank.

66C. (1) A credit union shall submit an annual compliance statement to the Bank certifying its compliance with the requirements of this Part and any other regulations prescribed under it by the Bank including regulations setting out the form and content of that statement.

(2) The annual compliance statement referred to in subsection (1) shall be submitted by a credit union to the Bank within 2 months of the end of each financial year of the credit union, or with such other frequency as the Bank may notify to the credit union from time to time. ]

Annotations:

Amendments:

F114

Inserted (3.03.2014) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 24, S.I. No. 99 of 2014.

General provisions

Credit, credit control and membership committees.

67

67.F115 [ (1) Without prejudice to section 56A , the board of directors shall appoint

( a ) a credit committee, which shall decide on applications for credit;

( b ) a credit control committee, which shall seek to ensure the repayment of loans by members of the credit union in accordance with their loan agreements; and

( c ) a membership committee which shall consider applications for membership of the credit union;

and the Third Schedule shall apply to the committees. ]

(2) The record of applications for credit furnished by a credit officer under section 65 (2) shall be considered by the credit committee at its next following meeting and become part of the records of the credit union.

(3) The membership committee shall—

( a) at least once in every month notify the board of directors of the new members whose applications they have approved; and

( b) where there is a doubt in respect of an applicant's qualification for membership of the credit union, submit the application for membership to the board of directors for a decision.

Annotations:

Amendments:

F115

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 53, S.I. No. 393 of 2013.

Limitation of remuneration.

68

68.F116 [ (1) A credit union shall not pay any remuneration, directly or indirectly, to

( a ) a director of the credit union, or

( b ) a member of the board oversight committee or a principal Committee of the credit union,

for any service performed by that person in that capacity. ]

(2) Nothing in subsection (1) shall be regarded as prohibiting the payment (or reimbursement) of expenses—

( a) which are necessarily incurred by a director or committee member in the course of performing any service on behalf, or for the benefit, of the credit union; and

( b) which are approved by a majority of the directors voting at a meeting of the board.

(3) Nothing in subsection (1) shall be regarded as prohibiting any officer F117 [ ] of a credit union, acting not as such but in his professional capacity, from tendering for the supply of, and if successful supplying, goods or services to the credit union.

(4) F118 [ ]

Annotations:

Amendments:

F116

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 54, S.I. No. 393 of 2013.

F117

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 55, S.I. No. 393 of 2013.

F118

Deleted (1.01.2016) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 56, S.I. No. 584 of 2015.

Conflicts of interest.

69

F119 [ 69. (1) Officers of a credit union, including the members of its board of directors, shall at all times ensure that individually, and collectively when acting in that capacity, they act in a manner free from conflicts of interest.

(2) The board of directors of a credit union shall approve and document in writing a policy for identifying, managing and resolving conflicts of interest and which policy will apply to all officers of a credit union.

(3) Every officer of a credit union shall identify all potential conflicts between his or her own interests and the interests of the credit union and shall take all necessary steps to ensure his or her role in the credit union is not influenced by any other interest.

(4) An officer of a credit union shall not, in any manner, directly or indirectly, participate in the consideration or determination of any matter which he or she, or a body with which he or she is connected, has a pecuniary interest or other conflict of interest or where a reasonably perceived conflict of interest exists and, accordingly, an officer shall withdraw from any meeting or part of the meeting during which such a matter is to be considered or determined.

(5) If, apart from this section, the withdrawal of an officer from a meeting in pursuance of subsection (4) would cause the meeting to become inquorate, the remaining members shall be treated as constituting a quorum while the matter in question is being considered or determined.

(6) An officer of a credit union who is or becomes interested, directly or indirectly, in

( a ) a contract that is made or proposed to be made by the credit union or proposed to be amended by the credit union,

( b ) any matter prescribed by the Bank for the purposes of this section, or

( c ) any other matter identified by the board of directors for the purpose of this section,

then the officer shall declare the nature of his or her interest

(i) where that officer is the chair of the board of directors, in writing to the board of directors and served on the secretary,

(ii) where that officer is the secretary, in writing to the board of directors and served on the chair,

(iii) where that officer is any other member of the board of directors, in writing to the board of directors and served on the secretary and the chair,

(iv) where that officer is the manager, in writing to the board of directors and served on the secretary, or

(v) in any other case, in writing to the board of directors and the manager and served on the secretary,

as soon as possible after the contract is so made or proposed to be made or so proposed to be amended or, as the case may be, after he or she becomes so interested.

(7) In the case of a declaration under subsection (6) by a member of the board of directors

( a ) where the contract or matter concerned comes before a meeting of the board, the declaration shall also be made in person by the member (if present) at the meeting at which the contract or matter is to be considered, and

( b ) in every other case, the secretary shall read the declaration made in writing under paragraph (i) or (ii) (as the case may be) of subsection (6) at the next meeting of the board of directors held after service of that declaration.

(8) Subject to subsection (9) , for the purposes of this section, a general notice in writing which is served by an officer of the credit union on the appropriate person to whom paragraph (i) , (ii) , (iii), (iv) or (v) of subsection (6) would relate if a declaration were served under that subsection and which is to the effect that

( a ) the officer is connected (whether as member, director, employee or otherwise) with a specified body and is regarded as interested in any contract, or other matter to which subsection (6) relates, which, after the date of the notice, may be made with or relate to that body; or

( b ) the officer is to be regarded as interested in any contract, or other matter to which subsection (6) relates, which, after the date of the notice, may be made with or relate to a specified person who is connected with him or her,

shall be deemed to be a sufficient declaration of interest in relation to any such contract or other matter.

(9) In the case of a general notice under subsection (8) and to which paragraph (i) , (ii) or (iii) of subsection (6) relates, notice under subsection (8) may be given

( a ) by the director concerned in person at a meeting of the board of directors, or

( b ) where the director concerned is the chair, in accordance with paragraph (i) of subsection (6) or where the director concerned is the secretary, in accordance with paragraph (ii) of that subsection, or, where the director concerned is any other director, in accordance with paragraph (iii) of that subsection,

and where a notice is given as mentioned in paragraph (b) , the secretary shall read the notice at the next meeting of the board of directors.

(10) For the purposes of this section

( a ) this section applies in relation to a transaction, arrangement or proposal in the same manner as it applies in relation to a contract, and

( b ) an officer of a credit union shall be regarded as connected with a particular body if the officer has an interest in the body, whether directly or indirectly and whether as a member, director, employee, shareholder or otherwise.

(11) Within 3 working days after a declaration or notice under this section is made or given, the secretary or manager (as the case may be) of the credit union concerned shall cause a copy of the declaration or notice to be entered in a register kept for that purpose, and that register shall

( a ) be open for inspection without charge by any officer, auditor or member of the credit union or the internal audit function, and

( b ) be available at every general meeting of the credit union and, if adequate notice in advance is given to the secretary by any director, at any meeting of the board of directors.

(12) In the case of a member of the board of directors of a credit union, where recurring or ongoing conflicts of interest arise for the member, then

( a ) where the member concerned is the chair, seek formal or informal guidance from some or all of the other directors, and

( b ) where the member concerned is not the chair, seek formal or informal guidance from the chair,

as to whether it is appropriate to resign and, following the consideration of such guidance by the member concerned, he or she shall resign as a member of the board of the credit union if he or she considers it appropriate to do so in the circumstances. ]

Annotations:

Amendments:

F119

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 25, S.I. No. 393 of 2013.

Required signatories etc.

70

70. (1) None of the documents specified in subsection (2) shall be effective in law to bind a credit union unless signed by at least two officers of the credit union, one of whom shall be a member of the board of directors.

F120 [ (2) The documents to which subsection (1) applies are any of the following, so far as not required by law to be under the seal of a credit union

( a ) a conveyance or transfer of property of any description by a credit union; and

( b ) any other document which does not fall within section 55(1)(o)(vi) but by which a credit union enters into an obligation of any description. ]

(3) If the rules of a credit union make provision as to the officers by whom documents to which subsection (1) applies are to be signed, a document which purports to be signed as required by that subsection shall not be invalid by reason of any failure to comply with any such provision of the rules.

(4) The provisions of this section are without prejudice to any additional provisions as to signatures imposed by the F121 [ Bank ] by way of condition under section 49 .

Annotations:

Amendments:

F120

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 57, S.I. No. 393 of 2013.

F121

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 38, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

Confidentiality of information.

71

71. (1) Subject to subsection (2), during his term of office or at any time thereafter, an officer F122 [ ] of a credit union shall not disclose or permit to be disclosed any information which concerns an account or transaction of a member with, or any other business of, the credit union.

(2) Subsection (1) does not apply to a disclosure of information—

( a) if or to the extent that it is necessary for the proper conduct of the business of the credit union; or

( b) which is required by a court in connection with any proceedings; or

( c) which is made with the consent of the person to whom the information relates and, where not the same person, of the person from whom the information was obtained; or

( d) which, in a case where the credit union is acting or has acted as agent for a person, is made to that person in respect of that capacity; or

( e) where the information is in the form of a summary or collection of information and is so framed as not to enable information relating to a particular member to be ascertained from it; or

( f) which, in the opinion of the F123 [ Bank ], is necessary for the protection of the funds of shareholders in or depositors with the credit union or to safeguard the interests of the credit union; or

F124 [ ( g ) which is made to the Bank for the purposes of its functions in relation to credit unions; or

( h ) which is made to the Credit Union Restructuring Board for the purposes of its functions under the Credit Union and Co-operation with Overseas Regulators Act 2012. ]

(3) As soon as practicable after the beginning of his term of office or, in the case of any person whose term of office began before the commencement of this section, after that commencement, every officer F125 [ ] of a credit union shall, in such manner as the F123 [ Bank ] may determine—

( a) be informed by the credit union of his obligations under this section; and

( b) in writing acknowledge that he has been so informed and understands his obligations.

(4) Any reference in the preceding provisions of this section to a term of office means—

( a) in relation to an officer who is an employee, the period of his employment; and

( b) in relation to a voluntary assistant, the period during which he is engaged in the operation of the credit union.

(5) A person who contravenes subsection (1) shall be guilty of an offence.

(6) In any proceedings for an offence under this section, the onus of proving that any of the paragraphs of subsection (2) excludes a disclosure from subsection (1) shall lie on the person who made or permitted the disclosure.

Annotations:

Amendments:

F122

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 58, S.I. No. 393 of 2013.

F123

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 39, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F124

Substituted and inserted (19.12.2012) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 59, S.I. No. 557 of 2012.

F125

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 60, S.I. No. 393 of 2013.

Editorial Notes:

E49

Previous affecting provision: subs. (2)(g) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 39, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Persons disqualified from acting.

72

72.F126 [ (1) A person who has been adjudicated bankrupt and whose bankruptcy still subsists or who has been convicted of an offence in relation to a credit union or an offence involving fraud or dishonesty shall not

( a ) sign an application form for the registration of a society as a credit union,

( b ) be qualified to be appointed or to act as an officer, auditor, receiver or liquidator of a credit union,

( c ) directly or indirectly take part in or be concerned in the management or operation of a credit union, or

( d ) permit his or her name to be put forward for election or appointment to any of the positions referred to in paragraph (b) . ]

F127 [ (2) If a person who is a member of

( a ) the board of directors,

( b ) the board oversight committee, or

( c ) a principal Committee,

of a credit union is adjudicated bankrupt or convicted of such an offence as is referred to in subsection (1) , then such person shall forthwith cease to hold office and the vacancy thereby created shall be deemed to be a casual vacancy and be filled accordingly. ]

(3) A decision of the board of directors of a credit union shall not be affected by the presence at a meeting of the board of a person who, by virtue of this section, is disqualified from being a director; but any vote which such a person purports to cast shall be disregarded.

(4) Any person who, in relation to a credit union, purports to act in a manner or capacity which, by virtue of his being disqualified under this section, he is prohibited from doing shall be guilty of an offence.

Annotations:

Amendments:

F126

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 61, S.I. No. 393 of 2013.

F127

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 62, S.I. No. 393 of 2013.

Giving of security by officers etc.

73

73. F128 [ ]

Annotations:

Amendments:

F128

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 63, S.I. No. 393 of 2013.

Editorial Notes:

E50

Previous affecting provision: subs. (3)(b) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 40, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; deleted as per F-note above.

Duty to account.

74

74. (1) Whenever required to do so in accordance with subsection (2), every officer F129 [ ] of a credit union who has the receipt or charge of money on behalf of the credit union shall—

( a) render such an account as may be required by the credit union or its board of directors;

( b) pay over all such money and deliver all such property of the credit union for the time being under his custody or control to such person as the credit union or its board of directors may appoint.

(2) Either or both of the requirements in subsection (1) shall arise—

( a) on demand; or

( b) on the service on the officer F130 [ ] of a notice in writing imposing the requirement or, as the case may be, both of the requirements;

and the requirement in paragraph (a) of that subsection shall also arise at such times as may be determined under the rules of the credit union.

(3) After the death of an officer F131 [ ] of a credit union, references in subsections (1) and (2) to the officer or voluntary assistant shall be taken to include references to his personal representatives.

F132 [ (4) If any person fails to comply with a requirement under subsection (1) , the Circuit Court, on the application to it of the credit union, may make an order requiring that person to comply with the requirement. ]

(5) The jurisdiction of the Circuit Court under subsection (4) shall be exercised by the judge for the time being assigned to the circuit in which the registered office of the credit union is situated.

Annotations:

Amendments:

F129

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 64, S.I. No. 393 of 2013.

F130

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 65, S.I. No. 393 of 2013.

F131

Deleted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 66, S.I. No. 393 of 2013.

F132

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 67, S.I. No. 393 of 2013.

Register of members and officers.

75

75. (1) Every credit union shall keep at its registered office a register in which shall be entered—

( a) the membership numbers, names and addresses of its members;

( b) a statement of the number of shares and amount of deposits held by each member and, if the shares are distinguished by numbers, the numbers of the shares so held;

( c) a statement of other property in the credit union, whether in loans or otherwise, held by each member;

( d) the date at which the name of any person was entered in the register as a member;

( e) the date at which any person ceased to be a member; and

F133 [ ( f ) the membership numbers, names and addresses of the officers of the credit union (excluding any person who is an officer solely by virtue of being an employee or a voluntary assistant), with the offices held by them respectively, the dates on which they assumed office and, where applicable, on which they ceased to hold office. ]

(2) The register may be kept either by making entries in bound books or by recording the matters in question in any other manner; but, where the register is not kept by making entries in a bound book but by some other means, adequate precautions shall be taken for guarding against, and facilitating the discovery of, any falsification.

(3) Every credit union shall either—

( a) keep at its registered office, for the purposes of inspection under section 76 , an abbreviated register, containing the particulars in the register kept under subsection (1), excluding those entered under paragraph (b) or paragraph (c) of that subsection; or

( b) so construct the register kept under subsection (1) that it is possible to open to inspection the particulars in the register, excluding those entered under paragraph (b) or paragraph (c) of that subsection and without exposing the particulars so entered.

(4) Where a credit union keeps a register pursuant to subsection (1) by recording the matters in question in any manner other than by making entries in bound books, the credit union shall keep at a place other than its registered office a duplicate register containing the particulars in the register kept under subsection (1).

F134 [ (5) The Bank or a person acting on its behalf may at all reasonable hours inspect any particulars in any register or duplicate register kept under this section. ]

(6) A credit union's register or duplicate register kept under this section, or any other register or list of members or shares kept by the credit union shall be prima facie evidence of any of the following particulars entered therein, that is to say—

( a) the membership numbers, names and addresses of members;

( b) the number of shares and the amount of deposits respectively held by the members, and the distinguishing numbers of those shares if they are distinguished by numbers;

( c) the date at which the name of any person was entered in the register as a member; and

( d) the date at which any person ceased to be a member.

(7) A credit union shall ensure that a register or duplicate register kept under this section is up to date and, in particular, shall ensure that, if an event occurs which gives rise to the need for the making of an entry in, a change to or a deletion from, the register, that entry, change or deletion is made within 28 days of the event in question.

(8) F135 [ ]

Annotations:

Amendments:

F133

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 68, S.I. No. 393 of 2013.

F134

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 69, S.I. No. 393 of 2013.

F135

Deleted (1.08.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 70, S.I. No. 280 of 2013.

Editorial Notes:

E51

Previous affecting provision: subs. (5) amended (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 41, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26; substituted as per F-note above.

Inspection of books.

76

76. (1) Notwithstanding anything in the rules of a credit union, except as provided by this Act or any other enactment, no-one (whether a member of the credit union or not) shall have the right to inspect the books of a credit union.

(2) Any member of a credit union or any other person having an interest in the funds of a credit union may, at any reasonable hour, inspect at the registered office of the credit union or at any other place where they may be kept—

( a) the register kept under section 75 , excluding the particulars entered therein under paragraph (b) or paragraph (c) of subsection (1) of that section; and

( b) his own account with the credit union;

but the right of inspection conferred by this subsection shall be exercisable subject to such conditions as to time and manner as may from time to time be determined by the board of directors.

(3) The rules of a credit union may make provision for the disclosure of its books and documents for the purpose of enabling it to enter into contracts for the benefit of the credit union.

(4) Subject to subsection (5), on the application of thirty members of a credit union, the F136 [ Bank ] may appoint an accountant to inspect and report on the books and documents of the credit union.

(5) An application under subsection (4) shall contain such particulars as the F136 [ Bank ] may require and shall not be valid unless—

( a) each of the members making the application has been a member throughout the whole of the twelve months immediately preceding the date of the application; and

( b) the members making the application deposit with the F136 [ Bank ] as security for the costs of the proposed inspection such sum as the F136 [ Bank ] may reasonably require.

(6) An accountant appointed under subsection (4) may make copies of, and take extracts from, any books or documents of the credit union at all reasonable hours at the credit union's registered office or at any other place where those books or documents are kept.

(7) All expenses of and incidental to an inspection by an accountant appointed under subsection (4) shall be defrayed in such proportions as the F136 [ Bank ] may direct—

( a) by the members making the application;

( b) out of the funds of the credit union; and

F137 [ ( c ) by the members or officers (other than any person who is an officer solely by virtue of being a voluntary assistant) or former members or officers (other than any person who was an officer solely by virtue of being a former voluntary assistant) of the credit union. ]

(8) The F136 [ Bank ] shall make known the results of an inspection by an accountant appointed under subsection (4) to the members who made the application and to the credit union.

Annotations:

Amendments:

F136

Substituted (1.05.2003) by Central Bank and Financial Services Authority of Ireland Act 2003 (12/2003), s. 35(1) and sch. 1 pt. 24 item 42, S.I. No. 160 of 2003, subject to transitional provisions in s. 36 and sch. 3 para. 26.

F137

Substituted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 35 and sch. 1 item 71, S.I. No. 393 of 2013.

F138 [ Additional requirements for credit unions ]

76A

F139 [ Strategic plan.

76A. (1) The board of directors of a credit union shall cause to be prepared and shall adopt a plan (in this Act referred to as a strategic plan ) which documents the strategy and objectives of the credit union (in this Act referred to as the strategic objectives ) and indicates how those strategic objectives are to be achieved.

(2) A strategic plan shall include

( a ) the objectives of the credit union s activities for a specified period of at least 3 years,

( b ) the nature and scope of the activities to be undertaken,

( c ) the strategies and policies for achieving those objectives,

( d ) the targets and criteria for assessing the performance of the credit union,

( e ) the financial projections for the credit union for a specified period of at least 3 financial years from, and including, the current financial year together with the supporting financial analysis and assumptions made,

( f ) the funding strategy proposed to support the projected balance sheet structure, and

( g ) such other matters as may be prescribed by the Bank.

(3) A credit union shall maintain adequate resources, both financial and non-financial, in relation to the nature, scale, complexity and risk profile of the activities being undertaken or to be undertaken in accordance with the strategic plan. ]

Annotations:

Amendments:

F139

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76B

F140 [ Risk management systems and systems and control.

76B. (1) In this section

compliance programme , in relation to a credit union, means the policies, procedures, systems and plans the credit union puts in place to monitor compliance, on an ongoing basis, with its obligations including requirements under all legal and regulatory requirements;

risk management system , in relation to a credit union, means the sum of those components that provide the basis (including organisational arrangements) for designing, implementing, monitoring, reviewing and continually improving risk management processes throughout the credit union;

systems and controls , in relation to a credit union, means a set of arrangements designed to provide reasonable assurance regarding the achievement of objectives in relation to the effectiveness and efficiency of operations, reliability of financial reporting and compliance with all legal and regulatory requirements.

(2) A credit union shall develop, implement, document and maintain a risk management system with such governance arrangements and systems and controls to allow it to identify, assess, measure, monitor, report and manage the risks which it is, or might reasonably be, exposed to.

(3) The risk management system

( a ) shall be clearly set out and documented, and

( b ) shall clearly set out the related tasks and responsibilities within the credit union.

(4) A credit union shall develop, adopt, implement, monitor, document and maintain systems and controls to manage and mitigate the risks identified by the risk management system.

(5) A credit union shall develop, implement, document and maintain a compliance programme that allows it to evaluate compliance with its obligations under this section including compliance with all legal and regulatory requirements. ]

Annotations:

Amendments:

F140

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76C

F141 [ Risk management officer.

76C. (1) The board of directors of a credit union shall appoint a person (in this Act referred to as a risk management officer ) with the necessary authority and resources to manage the risk management function within the credit union.

(2) Except where subsection (3)(a) applies or where otherwise prescribed by the Bank under subsection (3)(b) , nothing in this section shall be read as preventing the appointment of a person as risk management officer of a credit union who

( a ) holds another position as an officer in the credit union, or

( b ) is the risk management officer for one or more than one other credit union.

(3) The risk management officer of a credit union shall not

( a ) be a director, a member of the board oversight committee or the auditor of the credit union, or

( b ) hold such other position (whether within the credit union or otherwise) that the Bank may prescribe as being inappropriate to hold while being a risk management officer.

(4) The risk management officer of a credit union shall be responsible for identifying, assessing, reporting and monitoring all internal and external risks that could affect the credit union to which the risk management system referred to in section 76B relates, including risks to its employees, members, reputation and assets, and assisting the manager with managing and mitigating those risks.

(5) The board of directors of a credit union shall ensure that the risk management officer

( a ) has clearly documented reporting lines to the board,

( b ) has access to the board,

( c ) is independent in the exercise of his or her functions and, subject to paragraph (d) , shall be free from influence, and

( d ) is subject to internal oversight by the internal audit function.

(6) The board of directors of a credit union shall ensure that the role and functions of the risk management officer are documented in writing and include any role or function that may be prescribed by the Bank or be otherwise duly provided for by the Bank under any other enactment. ]

Annotations:

Amendments:

F141

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76D

F142 [ Compliance officer.

76D. (1) The board of directors of a credit union shall appoint a person (in this Act referred to as a compliance officer ) with the necessary authority and resources to manage the compliance programme, as provided for by section 76B , within the credit union.

(2) Except where subsection (3)(a) applies or where otherwise prescribed by the Bank under subsection (3)( b ), nothing in this section shall be read as preventing the appointment of a person as compliance officer of a credit union who

( a ) holds another position as an officer in the credit union, or

( b ) is the compliance officer for one or more than one other credit union.

(3) The compliance officer of a credit union shall not

( a ) be a director, a member of the board oversight committee or the auditor of the credit union, or

( b ) hold such other position (whether within the credit union or otherwise) that the Bank may prescribe as being inappropriate to hold while being a compliance officer.

(4) The compliance officer of a credit union shall be responsible for managing compliance at all levels in the credit union including

( a ) ensuring that the credit union complies with all statutory and regulatory requirements, and

( b ) monitoring such compliance to ensure that no conflict of interest arises.

(5) A credit union shall ensure that the compliance officer

( a ) has clearly documented reporting lines to the board,

( b ) has access to the board,

( c ) is independent in the exercise of his or her functions and, subject to paragraph ( d ), shall be free from influence, and

( d ) is subject to internal oversight by the internal audit function.

(6) The board of directors of a credit union shall ensure that the role and functions of the compliance officer are documented in writing and include any role or function that may be prescribed by the Bank or be otherwise duly provided for by the Bank under any other enactment. ]

Annotations:

Amendments:

F142

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76E

F143 [ Operational risk.

76E. (1) In this Act operational risk , in relation to a credit union, means the risk of loss (financial or otherwise) resulting from

( a ) inadequate or failed internal processes or systems of the credit union,

( b ) any failure by persons connected with the credit union,

( c ) legal risk (including exposure to fines, penalties or damages as well as associated legal costs), or

( d ) external events,

but does not include reputational risk.

(2) A credit union shall identify the operational risks it is exposed to, or is likely to be exposed to, and provide for the management and mitigation of those risks in the credit union s risk management system as provided for by section 76B . ]

Annotations:

Amendments:

F143

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76F

F144 [ Records management.

76F. (1) Without prejudice to sections 108 and 109 , a credit union shall ensure

( a ) that it makes, maintains and retains in books and documents proper and secure records of all matters that are required to enable the credit union, including the board of directors, board committees, nomination committee and officers and its board oversight committee and auditor to discharge their respective functions and as required by law,

( b ) that those records are made in a timely, accurate and consistent manner so that

(i) they contain the information necessary to enable persons discharging functions to which paragraph (a) relates to discharge their respective functions and that those records are sufficiently accurate and available with sufficient regularity and sufficient promptness for the purpose of so discharging, and

(ii) any information furnished or caused to be furnished by or on behalf of the credit union to the Bank is sufficiently accurate for the purposes for which it was so furnished and is available as and when required by the Bank,

and

( c ) that those records are produced when duly called upon

(i) by or under this Act, or

(ii) for the purposes of any other statutory obligation to produce them. ]

Annotations:

Amendments:

F144

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76G

F145 [ Information systems.

76G. (1) In this section information systems , in relation to the business of a credit union, means all the technical and non-technical methods of establishing, implementing, documenting and maintaining data and information within the credit union in a coherent and informative way which is in, or capable of being reproduced in, a legible form.

(2) For the purpose of supporting the strategic plan and enabling the board of directors of a credit union and other persons involved in the management of the credit union to control, direct and manage its affairs, a credit union shall, taking account of the nature, scale and complexity and risk profile of its business but without prejudice to any other statutory obligation to the like effect as this section

( a ) develop, prepare, implement and maintain secure and reliable information systems, or

( b ) where such systems already exist within the credit union, continue to implement and maintain such systems. ]

Annotations:

Amendments:

F145

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76H

F146 [ Management information.

76H. Without prejudice to any other statutory obligation to the like effect as this section, a credit union shall ensure that its information systems (within the meaning of section 76G) produce management information and other reports that are accurate, reliable, consistent, and timely so as to enable the board of directors and management team to

( a ) direct, control and manage the credit union s business efficiently and effectively,

( b ) make informed strategic and operational decisions, and

( c ) provide accurate information to the Bank on a timely basis, as and when required. ]

Annotations:

Amendments:

F146

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76I

F147 [ Business continuity plan.

76I. (1) In this section

business continuity , in relation to the occurrence of one or more abnormal events which could cause a material interruption to the business of a credit union, means the continuation of its business during and after such an occurrence;

business continuity plan , in relation to a credit union, means the contingency arrangements put in place to ensure that its essential functions can continue during and after the occurrence of one or more abnormal events which could cause a material interruption to the business of the credit union.

(2) A credit union shall put in place a business continuity plan

( a ) to ensure its business continuity if there occurs one or more abnormal events which could cause a material interruption to its business, and

( b ) to enable it to continue to meet all requirements imposed on it under the Credit Union Acts 1997 to 2012 and other financial services legislation if any such interruption occurs,

and such plan shall include, where appropriate, comprehensive testing at regular intervals of recovery procedures by officers of the credit union and testing of backup facilities. ]

Annotations:

Amendments:

F147

Inserted (11.10.2013) by Credit Union and Co-operation with Overseas Regulators Act 2012 (40/2012), s. 26, S.I. No. 393 of 2013.

76J

F148 [ Outsourcing.

76J. (1) Subject to the other provisions of this section, a credit union may by an agreement in writing entered into with any person (in this section referred to as a service provider ) and upon such terms and conditions as may be specified in the agreement, provide for the performance by that person, subject to such terms and conditions (if any) as may be so specified, of such process, service or activity (in this section referred to as outsourced activities ) of the credit union as may be so specified.

(2) The respective rights and obligations of the credit union and of the service provider shall be clearly allocated and set out in a written agreement.

(3) A credit union shall exercise due skill, care and diligence when entering into, managing or terminating any outsourced activities with a service provider.

(4) A credit union shall not enter into an agreement with a service provider for the performance of any of the functions exercisable by the board of directors of the credit union under section 55(1) but, subject to any matter that may be prescribed by the Bank, this shall not prevent the credit union from entering into an agreement under subsection (1) with a service provider for the provision of services in respect of any business activity (other than any such function) that is preliminary to or consequential upon the exercise by that board of the function concerned.

(5) The following conditions shall form part of every agreement to provide outsourced activities between a credit union and a service provider:

( a ) the service provider has the ability, capacity and any authorisation required by law to perform those activities reliably and professionally;

( b ) the service provider will carry out those activities effectively;

( c ) the service provider shall properly supervise the carrying out of those activities, and adequately manage the risks associated with the outsourcing;

( d ) appropriate action shall be taken by the credit union if it appears to it or to the Bank that the service provider may not be carrying out those activities effectively and in compliance with any applicable laws and regulatory requirements;

( e ) the service provider shall disclose to the credit union any development that may have a material impact on its ability to carry out the outsourced activities effectively and in compliance with applicable laws and regulatory requirements;

( f ) the credit union may terminate the arrangement for outsourcing, where necessary, without detriment to the continuity and quality of its provision of services to members;

( g ) the service provider shall, when required, co-operate with the Bank in connection with the outsourced activities;

( h ) the credit union, its auditors and the Bank shall have effective access to data related to the outsourced activities, as well as to the business premises of the service provider;

( i ) the Bank shall have without notice the right of access to the business premises of the service provider for the purposes of paragraph (g) ;

( j ) the service provider shall keep any confidential information relating to the credit union or its members in a safe and secure manner.

(6) For the purposes of every agreement to provide outsourced activities between a credit union and a service provider, the credit union shall

( a ) ensure that the service provider has no conflicts of interest in relation to the outsourced activity,