Corporate Governance and Administration Conference

Jury’s Hotel, Ballsbridge

25 March 2003

“Ensuring Compliance in Your Company”

Paul Appleby

Director of Corporate Enforcement

Outline of Presentation

Role of the ODCE Interaction with Agencies/Professional Bodies Directors’ Duties to ensure Compliance ODCE’s Investigative/Enforcement Role What to do if approached by ODCE

Role of the ODCE

Encouraging Compliance Uncovering Company Law Breaches Prosecuting Detected Breaches Sanctioning Improper Conduct in

Insolvent Companies Delivering Quality Services

Interaction with Agencies/Bodies

(1) Compliance Development of Guidance for Company

Directors, Auditors, Liquidators, etc. Promotion of Compliance Message Legislative Change/Implementation

Interaction with Agencies/Bodies

(2) Investigation/Enforcement Persons subject to a Reporting Obligation Information-Sharing Arrangements CRO, Courts, DPP’s Office, etc.

Directors’ Duties (1)

The Company – a Separate Legal Person General Duties of Directors

Act in the Company’s (not Personal) Interest Act with Due Care, Skill and Diligence

Defined Legal Obligations/Constraints Disclosure Requirements

Directors’ Duties (2)Company Documents to be kept,

updated and made available Register of Members Register of Directors and Secretary Register of Directors’/Secretary’s interests Register of debenture holders Directors’ Service Contracts Minute Books

Directors’ Duties (3)

Basic Operational Obligations Keeping proper books of account Holding the annual general meeting (AGM) Circulating to members before every AGM a

signed copy of the balance sheet, profit and loss account, director's and auditor's report

Holding an extraordinary general meeting when circumstances require

Directors’ Duties (4)

General Filing Obligations Change in constitution of company Change in registered office Change of directors/secretary Increase in Nominal/Issued Capital Annual return Mortgages and charges

Directors’ Duties (5)

Burden of Proof 1963-2001: Burden with the Prosecutor

to prove “knowing and wilful default” Now: Burden with the Defendant to

prove that he took “all reasonable steps to prevent” default

Investigative/Enforcement Role (1)

Main Triggers for Investigation Auditor Reports of Indictable Offences Liquidator Reports on Insolvent Companies Public Complaints Matters in the Public Domain

Investigative/Enforcement Role (2)

Process of Investigation Filtering Assessment Collection of Evidence Decision-Making

Investigative/Enforcement Role (3)

Decision Options Voluntary Compliance Insufficient Evidence Civil Remedy Restriction/Disqualification Summary Prosecution Prosecution on Indictment

What to do if contacted by ODCE

Don’t Panic! May be no element of culpability

Co-operate! Entitled to seek certain registers, etc. Seek professional advice in case of doubt May require search warrant in other cases

Sources of Information

www. odce .ie About the ODCE ODCE Services ODCE Publications/Statements Legislation Court Decisions