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Minister for Finance commences certain sections of the Credit Union and Co-operation with Overseas Regulators Act 2012

11 October 2013
The Minister for Finance, Mr. Michael Noonan, TD, has today signed an Order commencing certain sections of the Credit Union and Co-operation with Overseas Regulators Act 2012. The sections which are commenced are:
(a)               sections 6, 9, 16, 17, 18, 19, 20, 21, 22, 23, 25, 26, 28, 29 and 33;
(b)               section 15(2);
(c)               section 24 in so far as it relates to the insertion of sections 66A and 66B into the Credit Union Act 1997 (No. 15 of 1997);
(d)               section 27(1), in so far as it relates to the insertion of sections 76L, 76M, 76N, 76P, 76Q, 76R and subsections (1),(2),(3),(4), (5) and( 6) of section 76O into the Credit Union Act 1997, and section 27(2);
(e)                section 31 in so far as it relates to the insertion of subsection (5) of section 95A into the Credit Union Act 1997; and
(f)                 Schedule 1, other than-
(i)      the  items in that Schedule already in operation; and
(ii) items 9, 10, 31, 46, 56, 76, 102, 134, 135 and 143.
This Order provides for the commencement of particular provisions of the Act mainly in relation to new governance and prudential requirements for credit unions. These include provisions which relate to the new governance framework which sets out the roles and responsibilities of those in key positions in credit unions including the board of directors, chair, manager, board committees, credit officer and credit control officer and board oversight committee. These also include prudential requirements to address gaps in the existing regulatory framework including requirements relating to risk management, compliance and internal audit.
This Order also provides for the commencement of a number of miscellaneous and consequential amendments to the Credit Union Act 1997 in Schedule 1.
Commencement of these sections varies somewhat from the Implementation Plan as published. This is mainly in reference to section 15(1), board of directors, which is not commencing with this tranche. To address any queries that may arise, a Q&A is attached.
ENDS
Notes to editors:
The Credit Union and Co-operation with Overseas Regulators Act 2012 was passed in both Houses of the Oireachtas on 13 December 2012 and was signed by President Higgins on 19 December 2012. A number of sections, mainly in relation to restructuring and stabilisation commenced on 1 January 2013 and a further tranche was commenced on 1 August 2013.
Section 2(1) of the Credit Union and Co-operation with Overseas Regulators Act 2012 allows the Minister for Finance to commence certain provisions of the Act on different days.
Other measures in the 2012 Act will be commenced in the first half of 2014.
Q&A
Which sections of the Credit Union and Co-operation with Overseas Regulators Act 2012 have commenced on 11 October 2013?
All sections of the Credit Union and Co-operation with Overseas Regulators Act 2012 (2012 Act) as published in the Implementation Plan for the 2012 Act, which were scheduled to commence on 1 October 2013, have commenced on 11 October 2013, with the exception of section 15(1) and Items 46 and 102 of Schedule 1.
Which Sections have still to be commenced?
Parts of sections 15, 24 and 27 have yet to be commenced. Section 15(1) relates to reduction in board size, the election of the board, term of office of directors, exclusions from the board and length of office of a director. Section 66C of section 24 relates to credit unions reporting to the Central Bank. Section 76(O)(7) of section 27 refers to the Board Oversight Committee reporting to the members at the Annual General Meeting.
Sections in relation to prudential measures have not yet commenced. Commencement of prudential measures will begin in Q2 2014, allowing for meaningful consultation between the Central Bank and credit unions prior to implementation. These measures relate to savings, borrowing, lending, investments, reserves and liquidity. A number of consequential amendments to the Credit Union Act 1997 will also commence at this time.
Where can we get more information regarding the implications of the commencement of these sections?
The Central Bank will issue any updates to the ‘Credit Union Handbook’ and the ‘Implementation of the New Governance and Prudential Requirements for Credit Unions Frequently Asked Questions’ that are required, in relation to the commencement of these sections.