Director of Corporate Enforcement formally established

"New era in corporate governance" – Tánaiste

"We are sending a clear message – we will no longer tolerate those who flout the law" - Harney

Mary Harney, T.D., Tánaiste and Minister for Enterprise, Trade and Employment, today (Tuesday 27 November, 2001) ushered in what she described as "a new era" in corporate governance by formally establishing the Office of the Director of Corporate Enforcement (ODCE).

The Tánaiste announced that she had signed the Order establishing the new Office with effect from midnight tonight. The new Office will be formally launched at a reception to be held in Dublin Castle this evening.

The new Director of Corporate Enforcement is Mr Paul Appleby, who up to now has been a senior civil servant in charge of the Company Law Division at the Department of Enterprise, Trade & Employment. His mandate as Director is to improve the level of compliance with the requirements of the Companies Acts and to bring to account all those who disregard the law.

Speaking of Mr Appleby's appointment, the Tánaiste said: “The establishment of the Office of the Director of Corporate Enforcement is sending a clear message. That message is that the Government no longer tolerates those who are guilty of corporate crime and malpractice in Ireland. Indeed, society no longer tolerates those who in the past may have felt that they could flout the law with impunity. Through the establishment of this Office we signal our clear intention to address in a serious way the issue of compliance with the provisions of company law."

The Tánaiste continued, "I am confident that the work of the new Director, Paul Appleby, and his staff will give rise to positive economic and social benefits. His Office will help create the confidence nationally as well as throughout Europe and around the globe that Ireland is a place that operates the highest possible international standards of corporate governance. We want the world to know that Ireland is a good place to do business, a safe place to do business, and a profitable place to do business"

The functions assigned to the Director include enforcing and encouraging compliance with the Companies Acts, investigating suspected offences under the Acts and initiating summary prosecutions. The Director will also have a general supervisory role in respect of liquidators and receivers.

In his remarks to the Reception, the Director of Corporate Enforcement spoke of his belief that there was insufficient awareness of the obligations which company law imposes and indicated his initial plans to bridge that knowledge gap: “My staff and I are currently engaged in arranging for the production of concise statements of the principal duties and powers of companies, company directors, creditors and other actors within the company law environment. I see the ODCE website which is being developed as an important platform for communication and information sharing in support of our compliance and enforcement remit. The website is now available in a preliminary form at www.odce.ie/ and will be formally launched in a few weeks' time.”

Notes for Editors

The Director will be conferred with the first tranche of his statutory powers on 28 November, following the signing by Tánaiste of a commencement order under the Company Law Enforcement Act 2001. These initial powers will relate to company law compliance, investigations and prosecutions.

Further powers relating to insolvent companies and the restriction and disqualification of directors will be assigned to the Director in early 2002.

The establishment of the ODCE follows:

• significant disclosures of corporate malpractice in recent years, including with respect to company law;
• recommendations in 1998 from a Government Working Group chaired by Mr Michael McDowell, S.C., (now Attorney General) to improve compliance with, and enforcement of, the Companies Acts;
• the acceptance by Government in 1999 of the thrust of the Working Group's Report;
• the subsequent publication by the Government of the Company Law Enforcement Bill 2000 to give effect to the Working Group's recommendations;
• the enactment last July of the Company Law Enforcement Act 2001.

The primary mandate of the ODCE is to improve the compliance environment for corporate activity in the Irish economy by encouraging adherence to the requirements of the Companies Acts and bringing to account those who disregard the law.

The ODCE will have 30 administrative, accounting and legal staff and an annual budget of about 3.68 million euro (£2.9 million) over the 2002-2004 period. In addition, seven members of the Garda Siochana are being assigned to the Office on a full-time basis to assist with its work.