Supervisory Powers, Administrative Sanctions and the Prospectus Regulation

Supervisory Powers

Overview

Article 32 of Regulation (EU) 2017/1129 (“Prospectus Regulation”) as amended, outlines supervisory and investigatory powers that competent authorities, including Central Bank of Ireland, possess to fulfil their regulatory duties under the Prospectus Regulation.

Key Powers

Central Bank of Ireland has been granted a comprehensive range of powers to protect investors and maintain market integrity. Some of these powers are detailed below. For a complete overview of our powers, please see Article 32 of the Prospectus Regulation.

  • Require Publication of Information:  Require issuers, offerors or persons asking for admission to trading on a regulated market to include in the prospectus supplementary information, where necessary for investor protection.
  • Request information: Require issuers, offerors, auditors and financial intermediaries to provide necessary information and documentation.
  • Suspend or prohibit offerings:   to prohibit an offer of securities to the public or admission to trading on a regulated market  where an infringement has occurred or where there are reasonable grounds for r suspicion of regulatory breaches. Temporarily suspend securities offerings or trading for up to 10 consecutive working days where there are reasonable grounds for suspicion of regulatory breaches.
  • Restrict advertising: Prohibit or suspend advertisements for a maximum of 10 consecutive working days where there are reasonable grounds for suspicion of a breach the Prospectus  Regulation.
  • Suspend or refuse prospectus approval: Suspend to suspend the scrutiny of a prospectus submitted for approval or refuse approval of prospectuses for up to five years in cases of repeated and severe infringements.
  • Public disclosure: Make public any failures to comply with regulatory obligations.

The Central Bank also has broad powers under the Central Bank Act 1942 as amended, including , to hold inquiries, to investigate the business, or any aspect of the business, of a financial service provider, and to monitor the provision of financial services to consumers of those services to the extent that the Bank considers appropriate, for the purposes of protecting the public interest and the interests of consumers.

The above powers sit within a broader framework. A successful regulatory model is composed of a number of interlocking components, namely regulation (the rules), on-going supervision and enforcement. All components must interact with each other to ensure effective financial system governance.

Administrative Sanctions

Part 23 of the Companies Act 2014 and the European Union (Prospectus) Regulations 2019 provides powers for the Central Bank to impose administrative sanctions for prescribed contraventions of European Union (Prospectus) Regulations 2019 or Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017 or Part 4 of the Central Bank (Investment Market Conduct) Rules 2019.

Appointment of Assessor(s)

Where the Central Bank has reason to suspect that a prescribed contravention of the European Union (Prospectus) Regulations 2019 or Regulation (EU) 2018/1129 of the European Parliament and of the Council of 14 June 2017 or Part 4 of the Central Bank (Investment Market Conduct) Rules 2019 is being or has been committed, the Central Bank may appoint one or more assessors.

The assessor(s) will decide if the prescribed contravention is being or has been committed and determine the appropriate sanction(s) to be imposed.

Resolution by Agreement

Prior to an assessment being made, the Central Bank may enter into a written agreement with the subject of the assessment to resolve the matter.