Corporate Crime Law Review - Highlights of 2018 and what to expect in 2019Monday, 18 February 2019
In this review of 2018, we outline some of the major developments that occurred in Corporate Crime Law:
Tougher Measures to Combat White Collar Crime
A measure which had been proposed by Government to combat white collar crime was to consolidate and modernise anti-corruption and bribery legislation. This was achieved with the enactment and commencement of the Criminal Justice (Corruption Offences) Act 2018 over summer 2018. The Act introduced a number of new offences including a strict liability offence whereby companies may now be held liable for the actions of directors, managers, employees, agents or subsidiaries who commit a corruption offence with the intention of obtaining business or gaining an advantage for the company. To defend itself against a conviction for this offence, a company must show that it took all reasonable steps and exercised all due diligence to avoid commission of the offence. Companies now ought to ensure comprehensive anti-corruption polices are in place and their efficacy regularly monitored.
Anti-Money Laundering Reforms Introduced
On 9 July 2018, the Fifth Anti-Money Laundering Directive (5AMLD) came into force. 5AMLD amends the Fourth Anti-Money Laundering Directive (4AMLD) by introducing reforms to those existing anti-money laundering and counter-terrorist rules. 4AMLD has now mostly been transposed in Ireland by the European Union (Anti-Money Laundering: Beneficial Ownership of Corporate Entities) Regulations 2016, the Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2018 and the European Union (Anti-Money Laundering: Beneficial Ownership of Trusts) Regulations 2019. One aspect of 4AMLD not yet transposed is the requirement of each EU member state to establish a central register of beneficial ownership of corporate and other legal entities, and trusts (the Register of Beneficial Ownership or RBO), which was to be done by June 2018. The 2016 and 2019 Regulations referred to above require corporate entities and trusts to maintain their own RBOs but the deadline for the establishment of a central register has been extended by 5AMLD to 10 January 2020 for corporate and other legal entities, and to 10 March 2020 for trusts.
The European Commission will facilitate interconnectivity of the central registers of member states by 10 March 2021. We have previously analysed the key rights and obligations of companies arising from 4AMLD and the forthcoming central beneficial ownership register. Under 4AMLD, whether to permit public access to the RBO was left to the discretion of each member state. 5AMLD now requires that public access be afforded to the RBO in respect of corporate and other legal entities. The Department of Finance is currently developing implementing legislation for the RBO which is expected to be enacted in 2019. The RBO is scheduled to go live by end of Q2 2019. Other key changes introduced by 5AMLD are the extension of the anti-money laundering and counter-terrorism regime’s application to virtual currencies, custodian wallet providers, tax-related services, letting agents, and art dealers and the enhancement of restrictions concerning pre-payment cards.
Proposal to Transform and Enhance the ODCE
In December 2018, the Minister for Business, Enterprise and Innovation published the General Scheme of the Companies (Corporate Enforcement Authority) Bill 2018 (the Scheme). The Scheme proposes that the Office of the Director of Corporate Enforcement (ODCE), which currently sits within the Department of Business, Enterprise and Innovation, will be replaced by a stand-alone agency, the Corporate Enforcement Authority. The Authority will be vested with the powers and functions of the current ODCE but will take the form of a commission, modelled on the Competition and Consumer Protection Commission. It will be conferred with greater independence and enhanced investigatory powers. The legislation has been scheduled by Government to be enacted by end of June 2019. We will be monitoring the Scheme’s legislative progress and continue to provide updates.
For more information on the above, or for general Corporate Crime Law advice, contact any member of the ByrneWallace Corporate Crime Team or contact our Corporate Governance team for information on Corporate Governance.
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Key Reforms to Anti-Money Laundering and Counter-Terrorist Rules Signed into Law
New Act Brings Tougher Measures to Combat White Collar Crime