17 1989

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Number 17 of 1989


BUILDING SOCIETIES ACT, 1989


ARRANGEMENT OF SECTIONS

PART I

Preliminary and General

Section

1.

Short title and commencement.

2.

Interpretation.

3.

Regulations, directions, etc.

4.

Regulations to remove difficulties.

5.

Modification of Act to conform with changes in company and banking law.

6.

Repeals and consequential provisions.

7.

Service of notices.

8.

Expenses.

PART II

Formation and Authorisation of Building Societies

9.

Objects and general powers of a building society.

10.

Formation, registration and incorporation.

11.

Supplemental provisions relating to memorandum and rules.

12.

Acts of a society.

13.

Registered name.

14.

Alteration of memorandum and rules.

15.

Chief office of society.

16.

Membership and liability of members.

17.

Authorisation to raise funds.

PART III

Powers of a Building Society

18.

Power to raise funds and borrow money.

19.

Death of shareholder or depositor.

20.

Premises.

21.

Holding and developing land.

22.

Housing loans.

23.

Other loans.

24.

Tiered interest rates.

25.

Assessment of security for loans.

26.

Sale or retention of mortgaged property.

27.

Discharge of mortgage.

28.

Investment in and support of bodies corporate, etc.

29.

Financial services.

30.

Bonds and sureties.

31.

Conveyancing services.

32.

Auctioneering services and other services relating to land.

33.

Power to operate outside the State.

34.

Power to hedge.

35.

Prohibition on linking services.

36.

Exercise of powers.

PART IV

Control and Supervision of Building Societies by Central Bank

37.

Duty of the Central Bank as respects building societies.

38.

Supply of mortgage finance.

39.

Asset and liability ratios and structures.

40.

Revocation of authorisation and giving of direction by Central Bank.

41.

Inspections, information, etc.

42.

Control of advertising.

43.

Power of Court to prohibit certain contraventions of Act.

44.

Disclosure of information.

45.

Appointment of inspector and calling of special meeting.

46.

Provisions supplemental to section 45.

47.

Inspectors' reports and proceedings thereon.

PART V

Management of Building Societies

48.

Directors.

49.

Chief executive and secretary.

50.

Directors: Appointment and retirement.

51.

Directors: Supplementary provisions as to elections, etc.

52.

Connected persons.

53.

Disclosure by directors of interests in contracts.

54.

Contracts of employment of directors.

55.

Inspection of directors' service contracts.

56.

Substantial property transactions involving directors and connected persons.

57.

Restrictions on loans etc. to directors and connected persons.

58.

Sanctions for breach of section 57.

59.

Records of loans etc. falling within section 57.

60.

Record and disclosure of certain business.

61.

Particulars of directors' salaries etc. to be given in accounts.

62.

Prohibition of tax-free payments.

63.

Directors' names on business letters.

64.

Disqualification of certain persons from acting as directors or auditors of or managing building societies.

65.

Register of members.

66.

Register of directors, etc.

PART VI

Meetings, Resolutions, Voting, etc.

67.

Annual general meeting.

68.

Notice of meetings.

69.

Members' entitlement to vote on resolutions.

70.

Special resolutions.

71.

Conversion resolutions.

72.

Proxies.

73.

Right to demand a poll.

74.

Members' right to propose and circulate resolutions.

75.

Postal ballots.

PART VII

Accounts and Audit

76.

Accounting records, systems of business control and keeping of title deeds.

77.

Annual accounts.

78.

Directors' report.

79.

Summary financial statement.

80.

Display of statement.

81.

Signing of balance sheet.

82.

Documents to be laid before annual general meeting.

83.

Appointment and removal of auditors.

84.

Resolutions relating to appointment and removal of auditors.

85.

Resignation of auditors.

86.

Requisitioning of general meeting of society by resigning auditor.

87.

Qualifications for appointment as auditor.

88.

Auditors' report, right of access to books and to attend general meeting.

89.

Duties of auditor.

90.

Penalty for false statements to auditors.

PART VIII

Disputes and Complaints

91.

Settlement of disputes.

92.

Investigation of complaints.

PART IX

Savings Protection

93.

Deposit at Central Bank.

94.

Protection of shareholders' and depositors' funds.

PART X

Amalgamations and Transfers of Engagements

95.

Amalgamation of societies.

96.

Transfer of engagements.

97.

Statement for members relating to proposed amalgamation or transfer of engagements.

98.

Confirmation of amalgamation or transfer.

99.

Compensation for loss of office and bonuses to members.

PART XI

Conversion to Public Limited Company

100.

Interpretation of this Part.

101.

Conversion of a society to a public limited company.

102.

Protective provisions.

103.

Conversion statement.

104.

Confirmation and registration of conversion scheme by Central Bank.

105.

Petition to High Court against conversion scheme.

106.

Registration of society as a company.

107.

Consequential provisions on conversion of society.

108.

Conversion regulations.

PART XII

Winding up, etc.

109.

Winding up.

110.

Cancellation of registration.

111.

Liability of officers of society to penalty where proper accounting records not kept.

112.

Personal liability of officers of society where proper accounting records not kept.

PART XIII

Miscellaneous

113.

Financial year of a society.

114.

Liability of officer.

115.

Court's power to grant relief to an officer of a society.

116.

Provisions as to evidence.

117.

Form of registers, records, etc.

118.

Exemption from stamp duty.

119.

Offences.

120.

Furnishing false information, etc.

121.

Judgments against a society.

122.

Public file of a society.

123.

Subsidy by Minister in respect of interest on housing loans made by a society.

124.

Savings and transitional provisions.

125.

Transfer of functions to Central Bank.

126.

Amendments to the Bankers' Books Evidence Acts, 1879 and 1959, and the Bills of Exchange Act, 1882.

127.

Recognition of building society accounts.

FIRST SCHEDULE

Enactments Repealed

SECOND SCHEDULE

Provisions applicable as respects the memorandum and rules

THIRD SCHEDULE

Supplementary provisions in relation to authorisation

FOURTH SCHEDULE

Supplementary provisions in relation to revocation of an authorisation

FIFTH SCHEDULE

Supplementary provisions in relation to a direction by the Central Bank under Section 40


Acts Referred to

Age of Majority Act, 1985

1985, No. 2

Arbitration Act, 1954

1954, No. 26

Arbitration Act, 1980

1980, No. 7

Auctioneers and House Agents Act, 1947

1947, No. 10

Auctioneers and House Agents Act, 1967

1967, No. 9

Bankers' Books Evidence Act, 1879

42 & 43 Vict., c. 11

Bankers' Books Evidence (Amendment) Act, 1959

1959, No. 21

Bills of Exchange Act, 1882

45 & 46 Vict., c. 61

Building Societies Act, 1976

1976, No. 38

Building Societies (Amendment) Act, 1980

1980, No. 31

Building Societies (Amendment) Act, 1983

1983, No. 25

Building Societies (Amendment) Act, 1986

1986, No. 36

Central Bank Act, 1942

1942, No. 22

Central Bank Act, 1971

1971, No. 24

Companies Act, 1963

1963, No. 33

Conveyancing Act, 1881

44 & 45 Vict., c. 41

Currency Act, 1927

1927, No. 32

European Communities Act, 1972

1972, No. 27

Housing (Miscellaneous Provisions) Act, 1979

1979, No. 27

Housing Act, 1988

1988, No. 28

Industrial Credit Act, 1933

1933, No. 25

Land Act, 1984

1984, No. 24

Petty Sessions Ireland Act, 1851

14 & 15 Vict., c. 93

Registration of Title Act, 1964

1964, No. 16

Registry of Deeds Act, 1707

6 Anne, c.2

Registry of Deeds (Ireland) Act, 1832

2 & 3 Will. 4. c.87

Solicitors Act, 1954

1954, No. 36

Succession Act, 1965

1965, No. 27

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Number 17 of 1989


BUILDING SOCIETIES ACT, 1989


AN ACT TO MAKE FURTHER AND BETTER PROVISION WITH RESPECT TO BUILDING SOCIETIES AND TO PROVIDE FOR RELATED MATTERS. [12th July, 1989]

BE IT ENACTED BY THE OIREACHTAS AS FOLLOWS:

PART I

Preliminary and General

Short title and commencement.

1. —(1) This Act may be cited as the Building Societies Act, 1989.

(2) This Act shall come into operation on such day or days as may be fixed by order or orders of the Minister, either generally or with reference to a particular purpose or provision, and different days may be so fixed for different purposes and different provisions.

Interpretation.

2. —(1) In this Act, unless the context otherwise requires—

Act of 1963” means the Companies Act, 1963 ;

Act of 1971” means the Central Bank Act, 1971 ;

alteration”, in relation to the memorandum or rules of a building society, includes any addition to or variation of the memorandum or rules, the rescission of any provision of the memorandum or rules, whether with or without the substitution of one or more than one provision in the memorandum or rules for any provision so rescinded, and cognate words shall be construed accordingly;

adoptable powers” means powers which, under any provision of this Act, must, in order to be exercisable, be adopted by the society and “adopt” or “adopted” means adopt or adopted by agreement on the formation of the society or subsequently by a special resolution;

the annual accounts” has the meaning assigned to it by section 77 ;

associated body” means a body in which the society holds shares or corresponding membership rights under section 28 ;

authorisation” means authorisation under section 17 ;

bank” means the holder of a licence under section 9 of the Act of 1971;

building society” means a building society incorporated or deemed by section 124 (2) to be incorporated under this Act;

Central Bank” means the Central Bank of Ireland;

commission” includes any gift, bonus, fee, payment or other benefit;

the Companies Acts” means the Companies Act, 1963 and every enactment which is to be construed with it as one Act;

contravention” includes failure to comply;

conversion resolution” has the meaning assigned to it by section 71 ;

Court” means the High Court;

deposit” includes loan and cognate expressions shall be construed accordingly;

dispose” and “disposition”, in relation to any property, include the granting of any interest in or right over it;

director” includes any person occupying the position of director, by whatever name called;

functions” includes powers and duties;

house” includes any building or part of a building used or suitable for use as a dwelling and any outoffice, yard, garden, or other land appurtenant thereto or usually enjoyed therewith and “housing” shall be construed accordingly;

housing loan” means a loan within the meaning of section 22 ;

member”, in relation to a society, means a member within the meaning of section 16 ;

Minister” means the Minister for the Environment;

mortgage” includes charge;

officer”, in relation to a building society or other body corporate, means a director, chief executive or secretary, by whatever name called, and, in relation to any offence, also includes any person who purports to act as an officer of the body;

prescribed” means prescribed by regulations made under this Act;

the public file”, in relation to a building society, has the meaning assigned to it by section 122 ;

repealed enactments” means the enactments repealed by section 6 ;

society” means a building society;

special resolution” has the meaning assigned to it by section 70 ;

subsidiary” has the same meaning as it has in the Companies Acts;

summary financial statement” has the meaning assigned to it by section 79 .

(2) In this Act in any reference to a person's shareholding in a society the value of the person's shares shall be taken as the amount standing to his credit in respect of payments made by him on the shares and interest credited to them by way of capitalisation.

(3) In this Act a reference to a Part, section, or Schedule is to a Part, section, or Schedule of this Act, unless it is indicated that reference to some other enactment is intended.

(4) In this Act a reference to a subsection, paragraph or subparagraph, is to the subsection, paragraph or subparagraph of the provision in which the reference occurs, unless it is indicated that reference to some other provision is intended.

(5) In this Act a reference to an enactment shall be construed as a reference to that enactment as amended, adapted or extended by or under any subsequent enactment including this Act or regulations made under this Act.

(6) In this Act a reference to any provision of this Act shall, where appropriate, be construed as a reference to that provision as modified by regulation.

Regulations, directions, etc.

3. —(1) Regulations may be made by the appropriate authority, being the Minister, the Minister for Finance, the Minister for Justice or the Central Bank—

(a) for the general purposes or for any particular purpose of this Act, or

(b) prescribing any matter referred to in this Act as prescribed or to be prescribed, or in relation to any matter referred to as the subject of regulations.

(2) Regulations under this Act may apply either generally or by reference to a specified class or classes of societies, loans, assets, liabilities or powers of societies, or to a specified time or times, or during a specified period or periods or by reference to any other matter as the appropriate authority may consider appropriate.

(3) Without prejudice to any specific provision of this Act, any regulations thereunder may contain such incidental, consequential, transitional or supplementary provisions (including provisions for the purpose of effecting the transition from the repealed enactments to this Act) as may appear to the appropriate authority to be necessary or proper for any purpose of this Act or in consequence of, or to give full effect to, any provision of this Act.

(4) Every regulation made under this Act shall be laid before each House of the Oireachtas as soon as may be after it is made and, if a resolution annulling the regulation is passed by either House within the next 21 days on which that House has sat after the regulation is laid before it, the regulation shall be annulled accordingly, but without prejudice to the validity of anything previously done thereunder.

(5) The Central Bank may specify matters or give a direction in relation to any provision of this Act or of regulations made thereunder which provides for the specifying of such matters or the giving of such directions by it to a society and the following provisions shall apply—

(a) such specification or direction shall be given by an officer of the Central Bank duly authorised for that purpose,

(b) the provisions of subsections (2) and (3) shall, subject to any necessary modifications, apply to such specifications or directions as they apply to regulations but a specification or direction may also apply to an individual society.

Regulations to remove difficulties.

4. —If, in any respect, any difficulty arises in bringing any provision of this Act into operation or in relation to the operation of any such provision, the Minister may by regulations do anything which appears to him to be necessary or expedient for removing that difficulty, for bringing that provision into operation, or for securing or facilitating its operation, and any such regulations may modify any provision of this Act so far as may be necessary or expedient for carrying such provision into effect for the purposes aforesaid but no regulations shall be made under this section in relation to any provision of this Act after the expiration of 3 years commencing on the day on which the relevant provision of this Act came into operation.

Modification of Act to conform with changes in company and banking law.

5. —(1) If, on any modification of the enactments in force relating to companies or banks, it appears to the Minister to be expedient to modify the provisions of this Act for the purpose of assimilating the law relating to building societies to the law relating to companies or banks, the Minister may by regulations made with the consent of the Minister for Finance make such modifications of any provisions of this Act as he thinks appropriate for that purpose.

(2) The power conferred by subsection (1) includes power to modify the relevant provisions of this Act so as to—

(a) confer power to make orders, regulations, or other instruments;

(b) provide for the charging of fees but not any charge in the nature of taxation.

(3) Regulations under this section may—

(a) make consequential amendments to or repeals of other provisions of this Act;

(b) make such transitional or saving provisions as appear to the Minister to be necessary or expedient.

(4) In this section “modification” includes any addition and, as regards modifications of the enactments relating to companies or banks, any modification whether effected by any future Act or by a statutory instrument made after the passing of this Act under an Act whenever passed.

Repeals and consequential provisions.

6. —(1) Subject to subsections (2), (4) and (5), the enactments specified in column (2) of the First Schedule are hereby repealed to the extent specified in column (3) of the Schedule.

(2) Subject to subsection (3), Part III of the Building Societies Regulations, 1987 (S.I. No. 27 of 1987) as amended by the Building Societies Regulations (Amendment) Regulations, 1987 (S.I. No. 339 of 1987) shall continue in force, as if made by the Central Bank under section 11 (2) and with the substitution of “Central Bank” for “Registrar”, in relation to—

(a) loans made prior to the commencement of section 22 on the security of a mortgage of freehold or leasehold estate or interest in a house, and

(b) housing loans made on or after the said commencement.

(3) Rule I of the First Schedule to the said Regulations (redemption of loans) shall not apply to a housing loan, made on or after the commencement of section 22 , in respect of which the mortgage or loan agreement provides that the rate of interest may not be changed or may only be changed at intervals of not less than one year.

(4) A society that, immediately before the repeal of section 3 of the Building Societies (Amendment) Act, 1986 , is entitled, by virtue of that section and regulations thereunder, to make loans to members for the purpose of carrying out improvement works to a dwelling shall continue to be entitled to make such loans as if that section had not been repealed until, but only until—

(a) the date on which the memorandum of the society takes effect in accordance with section 124 (8), or

(b) the date on which the power to make loans under section 23 (1) (e) becomes exercisable by the society,

whichever is the earlier.

(5) Notwithstanding the repeal of the Building Societies Act, 1976 , sections 20, excepting subsections (9) and (11), and 21 of that Act, shall continue to apply in relation to the exercise by a building society of any function to which an authorisation under section 17 relates pending the coming into force of Part IX .

Service of notices.

7. —(1) Where a notice, direction or other document is authorised or required by or under this Act or regulations made thereunder to be served on a person, it shall, unless otherwise specified in this Act, be addressed to him and shall be served on or given to him in one of the following ways—

(a) where it is addressed to him by name, by delivering it to him;

(b) by leaving it at the address at which he ordinarily resides or, in a case in which an address for service has been furnished, at that address;

(c) by sending it by ordinary prepaid post addressed to him at the address at which he ordinarily resides or, in a case in which an address for service has been furnished, at that address; or

(d) in the case of an officer of a building society, by sending it to him by ordinary prepaid post addressed to him at the address of the chief office of the society.

(2) Any such document may—

(a) in the case of a building society or any other body corporate, be served on the secretary of the society or the body corporate;

(b) in the case of a partnership, be served on any partner; and

(c) in the case of an unincorporated association other than a partnership, be served on any member of its governing body.

Expenses.

8. —(1) The expenses incurred by the Minister and the Minister for Justice in the administration of this Act shall, to such extent as may be sanctioned by the Minister for Finance, be paid out of moneys provided by the Oireachtas.

(2) The expenses incurred by the Minister for Finance in the administration of this Act shall be paid out of moneys provided by the Oireachtas.

(3) The expenses incurred by the Central Bank in the administration of this Act shall be paid out of the general fund of the Bank.

PART II

Formation and Authorisation of Building Societies

Objects and general powers of a building society.

9. —(1) A building society may have as its objects the undertaking of any of the activities permitted by or under this Act and shall have as one of its objects the raising of funds for making housing loans.

(2) A society shall have the powers conferred by or under this Act and any incidental powers that are necessary for the achievement of its objects subject to—

(a) compliance with any requirement that, for a power to be exercisable by a society, it must be adopted by the society; and

(b) the exercise by the Central Bank of its functions under this Act, the Currency and Central Bank Acts, 1927 to 1971, or regulations made under any such Act.

Formation, registration and incorporation.

10. —(1) A building society is formed under this Act on compliance by the persons forming it with the requirements of this Act in relation to the formation of a society and is incorporated under this Act on this issue of a certificate of incorporation.

(2) Any 10 or more persons not disqualified under section 64 may form a society by—

(a) agreeing on the objects of the society and on the extent of its powers in a memorandum the provisions of which comply with the requirements for the time being of Part I of the Second Schedule ;

(b) agreeing on rules for the regulation of the society which comply with the requirements of Part II of the Second Schedule and any regulations for the time being made under section 11 (2); and

(c) delivering to the Central Bank 3 copies of the memorandum and rules, each copy signed by not less than 10 of those persons and by the intended secretary.

(3) Where copies of the memorandum and rules are delivered to the Central Bank in accordance with subsection (2), the Bank, if—

(a) it is satisfied that the memorandum and rules are in conformity with this Act and any regulations made thereunder and that the name of the proposed society is not undesirable,

(b) it has no reason to believe that the society will not be authorised under section 17 , and

(c) it is satisfied that registration would not be prejudicial to the orderly and proper regulation of building societies generally,

shall register the memorandum and rules and issue the society with a certificate of incorporation.

(4) Whenever the Central Bank decides to refuse to register a memorandum and rules it shall, within 6 months of the date of delivery of the rules and memorandum or of the date of receipt of such other information as it may require, whichever is the later, notify the signatories of the memorandum and the rules of its decision and of its reasons for it, and an appeal may be made to the Court against the decision within one month of the receipt of the Bank's decision by not less than 10 such persons.

(5) Where the Central Bank decides to register the memorandum and rules delivered to it under subsection (2) it shall retain and register one copy, return another copy to the secretary of the society together with a certificate of incorporation, keep another copy together with a copy of the certificate of incorporation in the public file of the society and notify the incorporation to the Minister and the Minister for Finance.

(6) From the date of its incorporation a society shall be a body corporate (with the name contained in its memorandum and rules) having perpetual succession and a seal and the power to hold land.

(7) A certificate of incorporation given under this section by the Central Bank shall be sufficient evidence until the contrary is shown that all the requirements of this Act in respect of registration and of matters precedent and incidental thereto have been complied with and that the society is a society duly registered and incorporated under this Act.

Supplemental provisions relating to memorandum and rules.

11. —(1) The provisions of the memorandum and rules of a building society, as read with the provisions of this Act and such regulations made thereunder as are in force for the time being, are binding upon—

(a) the society, every member and officer of the society; and

(b) all persons claiming on account of a member or under the rules;

and all such members, officers, and persons shall be taken to have notice of those provisions.

(2) The Central Bank may, in the interests of the orderly and proper regulation of building societies, by regulation—

(a) make further provision as respects the form and content of the memorandum and such provision may amend, extend or rescind any provision of Part I of the Second Schedule ;

(b) prescribe rules in respect of any of the matters in Part II of the Second Schedule or any of the following matters as respects housing loans or loans of the type referred to in section 6 (2) (a)

(i) the prohibiting or restricting of the charging of redemption fees;

(ii) the making available to a member to whom a loan is to be made of the report made under section 25 relating to the value of the security for the loan;

(iii) removing or restricting the right of a society to require a member to effect and keep effected insurance on the security for a loan with an insurer directed by the society or through the agency of the society or of any intermediary directed by the society;

(iv) precluding or restricting a society from requiring a member to pay its costs of legal investigation of title to the security;

(v) the arranging by a society through an insurer or intermediary nominated by it for the provision of mortgage protection insurance.

(3) Rules prescribed under subsection (2) (b) shall, with effect from one month after the commencement of the regulations, be part of the rules of any society to which they are declared to be applicable by the regulations, notwithstanding any provision of the rules of the society.

(4) Where the memorandum of a society registered before the commencement of regulations under subsection (2) (a) is not, in the opinion of the Central Bank, in accordance with any regulations under that subsection the Bank shall notify the society of its opinion within 6 months after the commencement of the regulations and in such a case the society shall forthwith take all necessary action to alter its memorandum accordingly within such time as the Bank may direct.

(5) If a society fails to comply with a notification by the Central Bank under subsection (4) the powers conferred on the Bank by section 40 shall become exercisable in relation to the society or the Bank may apply to have the society wound up under section 109 .

(6) A society shall supply to any person requiring them a copy of its memorandum and rules for such fee as may, from time to time, be fixed by the Central Bank.

(7) In this section “redemption fee” means, in relation to a loan, any sum in addition to principal and any interest due on such principal (without regard to the fact of the redemption of the loan) at the time of redemption of the whole or part of the loan.

Acts of a society.

12. —(1) Any act or thing done by a building society, which if the society had been empowered to do the same would have been lawfully and effectively done, shall, subject to section 11 (1), be effective in favour of any person relying on such act or thing who dealt with the society in good faith notwithstanding that the society had no power to do such act or thing.

(2) The Court may, on the application of a member, the Central Bank or any person having a material interest, restrain a society from doing any act or thing which it has no power to do.

Registered name.

13. —(1) The words “building society” or the words “cumann foirgníochta” shall be included in the name of a society.

(2) A person, not being a building society and not being a public utility society in existence at the commencement of this section, shall not use in reference to itself or himself a name, title or descriptive expression containing the words “building society” or the words “cumann foirgníochta” or any translation, variant or derivative of those words.

(3) A society shall not use any name or title other than its registered name.

(4) A society shall—

(a) paint or affix its name in a conspicuous position in easily legible letters on the outside of each of its offices or places of business,

(b) have its name engraved in legible characters on its seal,

(c) mention its name in all notices, letters, cheques, receipts or other documents purporting to be issued or sent by or on behalf of it, and

(d) include in all its letters the number with which it is registered and the address of its chief office.

(5) The use by a society, in addition to its registered name, of an abbreviated version of that name shall not be in breach of the provisions of this section.

(6) Where, in the opinion of the Central Bank, a society incorporated before the commencement of this section is registered or a society, on its first registration or on its registration by a new name, is registered (through inadvertence or otherwise) by a name which, in the opinion of the Bank, is undesirable, the Bank may require the society to change its name by giving it notice to that effect.

(7) Where notice is given under subsection (6) to a society, it shall be allowed such period, not being less than one month, as the Central Bank may direct to comply with the notice and, in the event of the society's failure to comply with the notice in that period, the powers conferred on the Bank by section 40 shall become exercisable in relation to the society or the Bank may apply to have the society wound up under section 109 .

Alteration of memorandum and rules.

14. —(1) A building society may by special resolution (and only by special resolution) alter its memorandum or its rules.

(2) A society so altering its memorandum or rules shall deliver to the Central Bank 3 copies of the alteration signed by 3 members and the secretary, together with a letter signed by the secretary confirming that a special resolution has been passed approving the alteration.

(3) Where copies are delivered to the Central Bank in accordance with subsection (2) and—

(a) it is satisfied that—

(i) the memorandum and rules as so altered are in conformity with this Act and any regulations made thereunder,

(ii) registration would not be prejudicial to the orderly and proper regulation of building societies generally, and

(iii) where the alteration involves a change of name, the changed name is not undesirable,

and

(b) in the case of a society that has not been authorised under section 17 , it has no reason to believe that the society will not be authorised under that section,

it shall retain and register one copy, return another copy to the secretary together with a certificate of registration, and keep another copy together with a copy of the certificate of registration in the public file of the society.

(4) An alteration under this section shall not have effect until registered under subsection (3) or until such later date following registration as may be specified in the special resolution unless the Central Bank otherwise directs.

(5) Where the Central Bank refuses to register under subsection (3) a copy of an alteration delivered to it under subsection (2), it shall, within 2 months of the receipt by it of the copies, notify the society of its decision and of its reasons for it, and an appeal may be made to the Court against the decision within one month of the receipt of the Bank's decision.

(6) An alteration of the memorandum or rules shall not affect any subsisting right or obligation of a society or of any member or other person concerned, or render defective any legal proceedings by or against the society, and any legal proceedings commenced by or against it under its former memorandum or rules may be continued by or against it under its altered memorandum or rules.

Chief office of society.

15. —(1) A building society shall, as from the date of its incorporation, have an office in the State (to be known as its chief office) to which all communications and notices may be addressed.

(2) Notice of any decision to change the location of the chief office and of the date on which it will become effective shall, within 7 days of the decision, be sent by the society to the Central Bank which shall register the notice and keep a copy of the notice in the public file of the society.

Membership and liability of members.

16. —(1) Every person holding one or more shares in a building society shall be a member of the society.

(2) Subject to its rules, a society may allow a person to whom a housing loan is made or to whom a loan secured by the mortgage of freehold or leasehold estate or interest has been made under the repealed enactments, to be a member without holding a share in the society, and the liability of such a member shall be no greater than it would be if the rules treated him as being, by reason of the making of the loan, the holder of a share in the society.

(3) Two or more persons may jointly hold shares in a society.

(4) The liability of a member of a society in respect of any share in the society on which no loan has been made shall be limited to the amount actually paid and in arrear on the share and, in respect of any share on which a loan has been made, shall be limited to the amount payable thereon under any mortgage or other security or under the rules of the society.

(5) A person who is not of full age within the meaning of the Age of Majority Act, 1985 , may be admitted as a member of a society the rules of which do not prohibit such admission and can give all necessary receipts, but while he is not of such age he shall not be entitled to vote, hold any office in the society or nominate or join in nominating a person for election as a director of the society.

(6) Where two or more persons jointly hold shares in a society, the following provisions shall apply—

(a) the person whose name first appears in the records of the society in relation to shares jointly held shall be the representative joint holder;

(b) except where the rules of a society otherwise provide, any notice or other document required by this Act to be sent by a society to the holders of shares in the society shall be deemed to have been sent to the joint holders if it is sent to the representative joint holder;

(c) where under this Act a member of a society may vote at a meeting or under a postal ballot by virtue of being a holder of shares in the society and such person is a joint holder of such shares, the person entitled to exercise the rights conferred by sections 68 , 69 and 72 to 74 shall, notwithstanding anything in those sections, be the representative joint holder;

(d) in the register required to be kept under section 65 the entry of that one of the joint holders who is the representative joint holder shall indicate that fact;

(e) for the purposes of Parts X and XI , the shares shall be deemed to be held by the representative joint holder alone, and a joint holder of the shares (other than a representative joint holder) shall not be regarded as a member of the society for the purposes of those Parts;

(f) the representative joint holder, but not the other joint holders, shall have the right to join in making an application under section 45 and any reference in that section to the total membership shall be construed accordingly;

(g) paragraph (b) shall not operate so as to prevent any of the joint holders from obtaining from the society, on demand, a copy of its annual accounts or summary financial statement;

(h) the joint holders shall be entitled to choose the order in which they are named in the records of the society.

(7) Where a loan, being a loan made under the repealed enactments secured by the mortgage of freehold or leasehold estate or interest or a housing loan, is made by a society to two or more persons jointly, the following provisions shall apply—

(a) the person whose name first appears in the records of the society in relation to such a loan shall be the representative joint borrower;

(b) except where the rules of a society otherwise provide, any notice or other document required by this Act to be sent to borrowers shall be deemed to be sent to the joint borrowers if it is sent to the representative joint borrower;

(c) where under this Act a borrower may vote at a meeting of the society or under a postal ballot and such a person is a joint borrower the person entitled to exercise the rights conferred by sections 68 , 69 , 72 and 73 shall, notwithstanding anything in those sections, be the representative joint borrower;

(d) in the register required to be kept under section 65 the entry of that one of the joint borrowers who is the representative joint borrower shall indicate that fact;

(e) for the purposes of Part XI , the rights of the joint borrowers as borrowing members of the society shall be treated as the rights of the representative joint borrower alone and a joint borrower (other than a representative joint borrower) shall not be regarded as a borrowing member of the society for the purposes of that Part;

(f) paragraph (b) shall not operate so as to prevent any of the joint borrowers from obtaining from the society, on demand, a copy of its annual accounts of summary financial statement;

(g) the joint borrowers shall be entitled to choose the order in which they are named in the records of the society.

Authorisation to raise funds.

17. —(1) Except to the extent permitted by subsection (3), a building society or a person acting or purporting to act on its behalf shall not raise funds, or advertise for or otherwise solicit deposits or subscriptions for shares unless there is in force an authorisation granted by the Central Bank or deemed to be granted under this section.

(2) A society which, immediately before the repeal of that section, had permission to advertise under section 19 of the Building Societies Act, 1976, is deemed to have been granted an authorisation under this section and any restriction imposed on the permission shall apply as if it were a condition on the authorisation.

(3) Authorisation is not required for—

(a) the acceptance of payments by way of subscription for deferred shares unless the aggregate of the payments exceeds £250,000 or such higher amount as may be specified by the Central Bank;

(b) the acceptance of payments for amounts due in respect of shares which represent interest on, or the repayment of, loans made to the holders of shares; or

(c) borrowing from another society or a bank or from an officer of the society, if the society has obtained the prior consent in writing of the Central Bank.

(4) On an application duly made by a society for authorisation under this section, the Central Bank may, as it thinks proper and having regard to section 37

(a) if it is satisfied that—

(i) the society has qualifying capital of an amount that is not less than the prescribed minimum,

(ii) the chairman and members of the board of directors, the chief executive and secretary are each fit and proper persons to hold their respective offices in the society, and

(iii) the board of directors, with the chief executive and secretary, have the capacity and intention to direct and manage the affairs of the society with prudence, integrity and adequate professional skills,

grant an authorisation;

(b) grant an authorisation subject to such conditions as will make it so satisfied or as it otherwise considers necessary; or

(c) refuse to grant an authorisation.

(5) The conditions of an authorisation may be revoked, amended or added to and conditions may be imposed by the Central Bank in relation to an authorisation granted or deemed to have been granted under this section where the Bank so thinks proper.

(6) Without prejudice to the generality of subsections (4) and (5), conditions may relate to any matter which the Central Bank considers relevant and may in particular—

(a) impose limitations on the issue of shares or debt instruments, the acceptance of deposits or the employment of assets;

(b) require the society to take specified steps with regard to the conduct of the business of any subsidiary or other associated body;

(c) require the removal of any director or other officer;

(d) relate to any activities of the society or a subsidiary or other associated body; or

(e) require the society to take certain steps or to refrain from adopting or pursuing a particular course of action or to restrict the scope of its business in a particular way.

(7) The provisions of the Third Schedule shall have effect for the purposes of this section.

(8) If a society raises, advertises for or solicits any funds without having an authorisation under this section, the Central Bank may make an application to the Court under section 109 for the winding up of the society.

(9) The grant of an authorisation to a society by or under this section shall not constitute a warranty as to the solvency of the society to which it is granted and the State or the Central Bank, without prejudice to section 94 , shall not be liable in respect of any losses incurred through the insolvency of a society to which an authorisation is deemed granted under this section or granted by the Bank.

(10) In this section—

deferred shares” means shares that—

(a) are not redeemable or are redeemable only in circumstances approved by the Central Bank,

(b) bear rights to participate in distributions of interest, profits or assets only after the claims of other shareholders are met,

(c) are issued on terms that they will be used in full to meet any loss or deficit in the funds of a society before the funds of other shareholders are called upon, and

(d) are issued in accordance with such other requirements as may be specified by the Central Bank for such shares;

the prescribed minimum”, in relation to qualifying capital, is £250,000 or such other sum as may be prescribed by the Central Bank in regulations made after consultation with the Minister;

qualifying capital”, in relation to a society applying for authorisation, means—

(a) the aggregate of the nominal value of the deferred shares issued and paid up at the date of the application and the amount of the reserves as shown in the last balance sheet of the society less any accumulated deficit as so shown; or

(b) where there is no such balance sheet, the aggregate of the nominal value of the deferred shares issued and paid up at the date of the application, such shares being held by not less than 10 members of whose number at least 10 each hold shares to the value of £10,000 or more.

PART III

Powers of a Building Society

Power to raise funds and borrow money.

18. —(1) Subject to section 17 , a building society may raise funds including, with the approval of the Central Bank, funds in a currency other than the currency of the State, to be used for the objects of the society—

(a) by the issue of shares of one or more than one denomination, either with or without accumulating interest, and may repay such funds, and

(b) by borrowing money and accordingly receiving deposits from any person.

(2) A repayment of funds under subsection (1) (a) may not be made to a shareholder (other than at his request) between the date on which he has indicated his intention to propose a resolution or a special resolution or to support a nomination at a meeting of the society and the date of the meeting.

(3) (a) Subject to paragraph (b), a society's aggregate liabilities under subsection (1) (b) shall not at any time exceed its aggregate liabilities under subsection (1) (a).

(b) Where, in the circumstances of a society, the Central Bank considers it expedient to do so, it may grant to the society a dispensation from paragraph (a), to such extent and on such terms as it thinks proper.

(4) A society shall not issue shares under subsection (1) (a) to which voting rights do not attach.

(5) A society may give security for money borrowed, including (subject to any regulations under subsection (6), the approval of the Central Bank and the terms of the mortgage) the security of mortgages held by the society.

(6) The Minister may, with the consent of the Minister for Finance and after consultation with the Central Bank, make regulations in relation to the transfer, sale or assignment of mortgages held by a society.

(7) If a society contravenes subsection (3) the powers conferred on the Central Bank by section 40 shall become exercisable in relation to the society but exceeding the limit shall not affect the validity of transactions effected in excess of it.

(8) A society shall notify the Central Bank of all loans received by it from other societies in such a manner as may be specified by the Bank.

Death of shareholder or depositor.

19. —(1) Where a shareholder in or a depositor with a building society dies and has in the funds of the society a sum of money, the sum or part of it, not exceeding such amount as may from time to time be fixed by the Central Bank after consultation with the Minister for Finance for the purposes of this section, may be paid by the society, without representation within the meaning of the Succession Act, 1965 , having been granted in respect of the estate of the deceased person, to the person who appears to the society to be entitled to receive it, whether as personal representative of the deceased person or otherwise, upon the society's being satisfied by evidence contained in a statutory declaration of the occurrence of the death and of the entitlement of the person, by or on whose behalf the sum is claimed, to the receipt thereof.

(2) Where a payment is made under this section by a society to a person who is not the executor of the deceased person concerned, the society shall, as soon as may be, give to the President of the High Court particulars in writing of the payment.

(3) Where a society duly makes a payment under this section, the payment shall be valid and effectual with respect to any demand against the funds of the society from any person making a claim as regards the estate of the deceased person concerned but the person claiming shall have his remedy for the amount of the payment against the person to whom the payment was made.

Premises.

20. —(1) A building society may acquire or provide itself with premises for the purpose of—

(a) conducting its business, or

(b) enabling a subsidiary or other associated body of the society to conduct the business of the society or of that body from the premises.

(2) If the premises are acquired or provided for the purpose of the business of a society, a subsidiary or other associated body, the society may acquire or otherwise provide itself with and hold the premises notwithstanding that part only of the premises is or will be required for that purpose.

(3) A society—

(a) may dispose of the whole or part of any premises held under this section, and

(b) if no part of the premises comes to be or, as the case may be, is any longer occupied for the business of the society, a subsidiary or other associated body, shall, subject to subsection (4), sell its estate or interest in the premises as soon as it is practicable to do so without undue loss.

(4) Subsection (3) (b) does not require a society to sell any premises if the society may hold it under section 21 and elects to do so by a resolution of the board of directors.

Holding and developing land.

21. —(1) Subject to section 36 , a building society may acquire, hold, dispose of, and develop or participate in developing land where the land is to be used—

(a) for residential purposes and purposes ancillary or incidental thereto, or

(b) for other commercial purposes.

(2) A society which is not for the time being entitled to exercise the powers referred to in this section may acquire, hold and dispose of land which is, or is to be, used for residential purposes if the purpose of the acquisition and holding of the land is to enable the society to make loans on the security of equitable interests in the land in circumstances authorised by the Central Bank.

(3) A society shall dispose of land held under this section if the Central Bank so directs.

(4) The powers referred to in paragraphs (a) and (b) of subsection (1) are separate powers, each of which, if available to a society, must, in order to be exercisable, be adopted by the society in accordance with section 36 .

(5) Premises held under section 20 may, either on application by a society or at the discretion of the Central Bank, be treated in their entirety and regardless of their use as land held under this section for the purposes of the exercise of the Bank's functions under section 39 .

Housing loans.

22. —(1) A building society may make to members loans (referred to in this Act as “housing loans”) including, with the approval of the Central Bank, loans in a currency other than the currency of the State, on the security of a mortgage of a freehold or leasehold estate or interest in a house for the purpose of enabling the member to provide or improve the house or to purchase the said estate or interest.

(2) The power to make housing loans includes power to make them on such terms as may be approved by the Central Bank even if the amount due to the society may exceed the value of the security at any time after the loan has been made and, where the amount due to the society in respect of capital exceeds the amount of the loan, any reference in this Act to the repayment of the loan includes reference to payment of the excess.

(3) Subject to subsection (2), a loan made to a member under this section shall be made on terms such that the capital element of the mortgage debt shall not exceed the value of the security.

(4) A society shall not make a loan under this section on the security of any freehold or leasehold estate or interest which is subject to a prior mortgage unless the prior mortgage is in favour of the society.

(5) (a) The Central Bank may, by regulations, specify charges or descriptions of charges which in its opinion would not materially affect the security and “prior mortgage” in subsection (4) shall not include any charge so specified.

(b) Pending the making of regulations by the Central Bank under paragraph (a)prior mortgage” shall not include any of the charges specified in the Building Societies (Amendment) Act, 1983 , or in section 4 (2) of the Land Act, 1984 , notwithstanding the repeal of both by this Act.

(6) Nothing in this section shall be construed as precluding a society from accepting additional security for further securing a housing loan as the society may determine.

Other loans.

23. —(1) Subject to this section, a building society may make loans, including, with the approval of the Central Bank, loans in a currency other than the currency of the State, other than housing loans, of the following categories—

(a) loans fully secured by the mortgage of freehold or leasehold estate or interest;

(b) loans to members, before the mortgage has been created, not exceeding the amount which the society has agreed to lend by way of a housing loan;

(c) loans fully secured by one or more securities or guarantees of such description as are from time to time specified by the Central Bank;

(d) loans to be applied in or towards payment of the deposit for the purchase of freehold or leasehold estate or interest that will secure a loan by way of mortgage but such a loan may not exceed 15 per cent., or such other percentage as may be prescribed by the Central Bank, of the amount to be paid for the purchase of the estate or interest;

(e) loans, whether unsecured or secured to any extent, to an individual for the provision or improvement of accommodation for himself or his family; and

(f) loans, including loans on overdraft or other facility accounts, whether unsecured or secured to any extent, to any person.

(2) The power to make loans under subsection (1) is subject to—

(a) section 36 in the case of loans under paragraphs (e) and (f) of that subsection, and

(b) any limit which may be specified by the Central Bank in relation to—

(i) the amount of a loan under any of the categories referred to in subsection (1),

(ii) the amount outstanding at any time, to a person or persons acting in concert, on a loan or loans of a particular category or combination of categories,

by reference to such matters as the Bank considers appropriate.

(3) A society shall take all reasonable steps to ensure that the mortgage referred to in paragraph (b) of subsection (1) is created as soon as may be after the making of a loan under the said paragraph.

Tiered interest rates.

24. —(1) A building society shall not charge a tiered interest rate—

(a) on a loan made under the repealed enactments, unless a tiered interest rate was lawfully charged on the date of the repeal; or

(b) on a housing loan made under this Act, unless a tiered rate is charged from the day on which the mortgage securing the loan is created, the charging of a tiered rate is specifically mentioned in the mortgage and is acknowledged in writing by the member in a form to be specified by the Central Bank.

(2) In this section—

(a) “tiered interest rate” means the rate of interest on a loan where the rate—

(i) is determined by reference to the amount of the loan made or to the amount outstanding at any time on foot of the loan, or to the income of the member to whom the loan is made, as the case may be, and

(ii) is greater than the lowest rate of interest applicable at the time to loans of the same type made by the society to members generally, and

(b) “a loan made under the repealed enactments” means a loan made by the society to a member on the security of a mortgage of a freehold or leasehold estate or interest in a house.

Assessment of security for loans.

25. —(1) A building society shall make such arrangements for assessing the adequacy of the security for loans to be secured by the mortgage of freehold or leasehold estate or interest (referred to in this section as “security”) as may be reasonably expected to ensure that—

(a) an assessment will be made on the occasion of each loan whether or not any previous assessment was made with a view to further loans,

(b) each assessment will be made by a person holding office in or employed by the society who is competent to make the assessment and is not disqualified under this section from making it,

(c) each person making the assessment will have furnished to him a written report on the value of the security and any factors likely to affect its value made by a person who is competent to value, and is not disqualified under this section from making a report on, the security in question,

but the arrangements need not require each report to be made with a view to a particular assessment so long as it is adequate for the purpose of making the assessment.

(2) The following persons are disqualified from making a report on the value of a security under this section, that is to say—

(a) an officer or employee of the society who makes assessments of the adequacy of securities for loans or authorises the making of loans;

(b) where the society has made, or undertaken to make, to any person a payment for introducing to it an applicant for the loan, that person;

(c) where the loan is to be made following a disposition of the security, any person having a financial interest in the disposition and any director, other officer or employee of his or of an associated employer; and

(d) where the loan is to be made following a disposition of the security, any person receiving a commission for introducing the parties to the transaction involving the disposition and any director, other officer or employee of his.

(3) In relation to any security which is to secure a loan following its disposition, the following persons are disqualified from making an assessment of the security or authorising the making of the loan, that is to say—

(a) any person, other than the society making the loan, having a financial interest in the disposition and any director, other officer or employee of his or of an associated employer; and

(b) any person receiving a commission for introducing the parties to the transaction involving the disposition and any director, other officer or employee of his.

(4) An officer, solicitor, surveyor or valuer of a society or other person engaged by a society in making reports on the value of securities or in connection with the assessment of the adequacy of securities or the authorisation of the making of loans shall not accept any commission for or in connection with any loan made or proposed to be made by the society.

(5) Any person who, being disqualified from doing so—

(a) makes a report on a security for a loan,

(b) makes an assessment of the adequacy of a security for a loan, or

(c) authorises the making of a loan,

and, in the case of a person making a report, does so knowing or having reason to believe that the report will be used or is likely to be used for the purposes of a loan, shall be guilty of an offence.

(6) For the purpose of this section any 2 employers are associated if one is a body corporate of which the other (directly or indirectly) has control or if both are bodies corporate of which a third person directly or indirectly has control; and the expression “associated employer” shall be construed accordingly.

(7) In this section a person shall be taken to have a financial interest in the disposition of any security if, but only if, he would, on a disposition of that security, be entitled (whether directly or indirectly, and whether in possession or not) to the whole or part of the proceeds of the disposition.

Sale or retention of mortgaged property.

26. —(1) Where any estate or interest in land mortgaged to a building society is sold by the society in exercise of a power of sale, the society shall ensure as far as is reasonably practicable that the property is sold at the best price reasonably obtainable.

(2) Where a society decides to retain any estate or interest in land mortgaged to the society in exercise of a power under the mortgage, the value of the property shall be determined by an independent and competent person appointed by the society and agreed to by the mortgagor and any other mortgagee and the value so determined shall be treated as if it were money received by a mortgagee arising from a sale.

(3) Where the society is unable to obtain the agreement of the mortgagor or other mortgagee to the appointment of a person under subsection (2), the society may apply to a court of competent jurisdiction to appoint an independent and competent person to determine the value of the property and the costs incurred in such application shall be defrayed equally by the applicant and the persons who do not agree to the person proposed for appointment by the society under subsection (2).

(4) To the extent that any agreement relieves (or may have the effect of relieving) a society or any person from the obligation imposed by subsection (1) or (2) the agreement shall be void.

(5) Where property to which this section relates is sold or its value determined in accordance with subsection (2), the society shall send a notice by registered post to the mortgagor and any other mortgagee at his last known address within 21 days after the completion of the sale or the date on which the report on the value of the property is received by the society, as the case may be, containing particulars of the sale or the value of the property, as the case may be.

(6) Nothing in this section shall affect the operation of any rule of law relating to the duty of a mortgagee to account to a mortgagor.

(7) In this section, “mortgagor” means a person to whom a loan is made by a society, and includes the successor in title of that person.

Discharge of mortgage.

27. —(1) Where, in relation to unregistered land within the meaning of the Registration of Title Act, 1964 , all moneys secured by a mortgage have been fully paid or discharged a building society may endorse on, or annex to, such mortgage either a reconveyance of the mortgaged property to the owner of the equity of redemption (or to such persons and to such uses as such owner may direct) or a receipt under the seal of the society.

(2) Where, in relation to registered land within the meaning of the Registration of Title Act, 1964 , all moneys secured by a mortgage have been fully paid or discharged, a society may issue to the registered owner of the land a receipt under the seal of the society which shall, for the purposes of section 65 of that Act, be sufficient proof of the satisfaction of the mortgage.

(3) A receipt under this section shall operate to vacate the mortgage and shall, without any reconveyance or re-surrender, vest the estate or interest in the property comprised in the mortgage in the person for the time being entitled to the equity of redemption.

(4) Where a mortgage has been registered in the Registry of Deeds established by the Registration of Deeds Act, 1707, the Registrar under that Act shall, on production of a receipt under subsection (1), make an entry opposite the entry of the mortgage to the effect that the mortgage is satisfied and shall grant a certificate (either on the mortgage or separately) to the like effect.

(5) A certificate under subsection (4) shall be received in evidence in all courts and proceedings without any further proof, and an entry under that subsection shall have the effect of clearing the register or record of the relevant mortgage.

(6) The power conferred on the Minister for Justice by section 35 of the Registry of Deeds (Ireland) Act, 1832 (as adapted by the Registry of Deeds (Ireland) Act, 1832 (Adaptation) Order, 1956 (S.I. 281 of 1956)) to fix fees shall include power to fix fees to be paid for making the entry and granting the certificate under subsection (4), and any moneys received under this subsection shall be paid into the Exchequer.

Investment in and support of bodies corporate, etc.

28. —(1) Subject to section 36 , a building society may—

(a) invest in bodies corporate, that is to say, acquire and hold shares or corresponding membership rights in bodies corporate, or form or take part in forming bodies corporate; and

(b) support bodies corporate or approved housing bodies, that is to say, provide bodies corporate in which it invests or approved housing bodies with any of the following services—

(i) loans with or without security and whether or not at interest,

(ii) grants of money,

(iii) guarantees of the discharge of their liabilities, and

(iv) the use of services or property, whether or not for payment.

(2) (a) Subject to paragraph (b) a society shall not, under this section, invest in a body corporate whose objects enable it to—

(i) carry on activities which are outside the powers of the society, or

(ii) invest in other bodies corporate,

but this shall not prevent a society from investing in and supporting a body for a period of 3 months, pending the alteration of the objects of that body.

(b) Where the Central Bank considers it expedient to do so, it may on application by a society grant a dispensation from paragraph (a) to such extent and on such terms and conditions as it considers appropriate.

(3) The Central Bank may specify a percentage of the share capital or corresponding membership rights of a body corporate which a society must hold as a minimum in order to exercise the power available under this section.

(4) Where a body corporate in which a society invests or proposes to invest is, at the time of any such investment or proposed investment or at any time thereafter, engaged in the business of accepting deposits or other repayable funds, the Central Bank may specify such limits or restrictions on the business of the body corporate as it considers appropriate in the interests of the orderly and proper regulation of building societies.

(5) In this section—

approved housing body” means a body approved of by the Minister for the purposes of section 5 of the Housing Act, 1988 , or a society registered under the Industrial and Provident Societies Acts, 1893 to 1978, or under the Friendly Societies Acts, 1896 to 1977, or a voluntary group provided, in the case of any such society or group, that the support is given for the purpose of providing housing;

corresponding membership rights”, in relation to a body corporate, means such rights (other than rights arising from the holding of shares) as are attributable to membership of the body;

property” includes rights of any description.

Financial services.

29. —(1) Subject to section 36 and to subsections (3) and (4) of this section, a building society may provide, as principal or as agent, financial services.

(2) In this section “financial services” means any of the following activities—

(a) arranging the provision of credit, including the joining of credit card companies,

(b) the giving of guarantees and indemnities,

(c) the sale and purchase of financial obligations, debts and securities,

(d) investment services,

(e) the discounting of credit instruments,

(f) the acceptance of deposits of money for current accounts, the collection of cheques and the payment of cheques drawn on the society,

(g) insurance,

(h) the maintenance of a company's register of members,

(i) the provision of advice relating to taxation and financial planning,

(j) financing hire-purchase,

(k) leasing,

(l) money transmission,

(m) trusteeship,

(n) executorship,

(o) foreign exchange,

(p) the operation of a credit transfer system,

(q) the issue of drafts, travellers cheques and letters of credit,

or other activities of a similar nature (including advisory services) that appear to the Central Bank to be financial services but does not include the making of loans.

(3) Subject to section 30 , a society shall not carry on insurance business otherwise than by a subsidiary or other associated body of the society.

(4) The undertaking by a society or the subsidiary or other associated body of a society of any activity pursuant to the provisions of this section and section 36 shall be subject to the provisions of any other enactment.

(5) Section 26 of the Central Bank Act, 1971 (which relates to the collection of cheques and other instruments), is amended—

(a) by the insertion of the words “or a building society authorised under the Building Societies Act, 1989” after “1965” in both subsections (2) and (3) of that section,

(b) by the insertion in subsection (6) of that section of the following additional paragraph—

“(f) any document issued by a person who maintains an account with a building society, authorised under the Building Societies Act, 1989, which is intended to enable a person to obtain payment from the building society of the sum mentioned in the document.”.

(6) Section 30 of the Succession Act, 1965 (which relates to the power to grant representation to a trust corporation), is amended by the insertion in subsection (4) (b) of that section of the following additional subparagraph—

“(v) a building society authorised under the Building Societies Act, 1989; or”.

Bonds and sureties.

30. —(1) A building society undertaking an activity pursuant to section 29 shall not be regarded as having contravened any provision of the Insurance Acts by reason only of the fact that it gives, enters into or accepts a bond or a contract of suretyship or guarantee to which this section applies.

(2) This section applies to any bond or any contract of suretyship or guarantee which is given, or is entered into, as surety or guarantor by a society in the course of its business or which is in the course of his banking business given or entered into, as surety or guarantor, by a person resident outside the State to satisfy, and only for the purposes of, a requirement which is both—

(a) a requirement of a society, and

(b) made solely for the purpose of securing financial facilities to be made available by that society.

(3) For the purposes of this section—

banking business” has the same meaning as in the Act of 1971,

the Insurance Acts” means the Insurance Acts, 1909 to 1989, and regulations relating to insurance business made under the European Communities Act, 1972 .

Conveyancing services.

31. —(1) Notwithstanding anything to the contrary in the Solicitors Act, 1954 (“the Act of 1954”) the Minister for Justice, after consultation with the Minister and the Central Bank, may make regulations authorising building societies to provide conveyancing services.

(2) Conveyancing services may be provided by a society in accordance with the provisions of regulations made under this section and in compliance with the requirements of this section and section 36 .

(3) Except in a conveyance by way of mortgage, a society shall not provide conveyancing services to both the disponer and the disponee in the one conveyance.

(4) Regulations under this section may include provisions for—

(a) the protection of persons for whom conveyancing services are provided by societies from conflicts of interests that might otherwise arise in connection with the provision of the services;

(b) securing that adequate compensation is available to such persons in respect of negligence, fraud or other dishonesty on the part of officers or employees of societies in connection with the provision of the services;

(c) the extent to which and the manner in which such services would require the involvement of persons qualified to practise as solicitors within the meaning of the Act of 1954, and the qualifications and experience of personnel generally engaged in the provision of the services;

(d) the class or classes of persons to whom the services may be provided;

(e) the restriction of the power to provide the services to property of a prescribed description;

(f) the restriction of the power to provide the services to societies of a prescribed class or classes;

(g) maximum rates or scales of fees, costs or expenses which may be charged by societies for the provision of the services.

(5) Any communication made to or by a society in the course of its acting as such for a client in conjunction with providing conveyancing services for him shall in any legal proceedings be privileged from disclosure in like manner as if the society had at all material times been acting as the client's solicitor.

(6) A society providing conveyancing services shall not in relation to the provision of such services be an unqualified person within the meaning of the Act of 1954.

(7) Section 58 of the Act of 1954 (restriction on persons drawing certain documents, etc., when not qualified to act as a solicitor) shall not apply to—

(a) a society, or

(b) any officer or employee of a society by reason of any act done by him in the course of his office or employment on behalf of the society,

where the society is providing conveyancing services in accordance with this section.

(8) Section 59 of the Act of 1954 (prohibition on solicitor acting as agent for an unqualified person) shall not apply to any solicitor by reason of any act done by him as an officer or employee of a building society where that society is providing conveyancing services in accordance with this section.

(9) Any reference in any enactment to a solicitor shall, insofar as it relates to conveyancing services under this section, be construed as including a reference to a society.

(10) Where a society provides conveyancing services, it shall include in any document or advertisement issued to the public, which contains a reference to the provision of the services, a statement of the charges or the basis for the charges in respect of the services and a client shall be entitled to ask for and to be furnished with an itemised statement of that society's charges in respect of a conveyance undertaken by the society on his behalf.

(11) Any information which comes into the possession of an officer or employee of a society by virtue of his involvement in the provision of conveyancing services by the society shall not be used by him or by the society or any subsidiary or any other associated body of the society to promote the business of the society or the subsidiary or other associated body.

(12) (a) A society providing conveyancing services shall maintain separate accounting records and prepare accounts in respect of each year showing—

(i) the costs to the society of providing the services, and

(ii) the income accruing to the society from the charges made for the services,

and shall so provide and charge for the services that the income from the provision of the services is not less than sufficient to meet all costs properly attributable to the provision of the services taking one year with another.

(b) A statement attesting the correctness of the accounts prepared in accordance with paragraph (a) and confirming that such accounts have not been distorted as a result of any arrangement which would affect the apportionment of costs and income associated with the provision of the services and that such apportionments as have been made have been properly made shall be signed by the chief executive and 2 directors and attached to the annual accounts.

(13) References in this section to “conveyancing services” are references to the preparation of transfers, conveyances, contracts, leases or other assurances in connection with the disposition or acquisition of estates or interests in land.

Auctioneering services and other services relating to land.

32. —(1) Subject to section 36 , a building society may provide—

(a) an auctioneering service in accordance with the Auctioneers and House Agents Act, 1947 (“the Act of 1947”);

(b) other services relating to land.

(2) (a) The Revenue Commissioners shall grant to a society which applies in accordance with this section a licence to carry on the business of an auctioneer in accordance with the Act of 1947.

(b) An application by a society under paragraph (a) for an auctioneer's licence shall be accompanied by—

(i) a copy of the approval granted by the Central Bank under section 36 to the exercise by the society of the power referred to in subsection (1) (a),

(ii) a certificate of the Accountant of the Courts of Justice, granted not more than 28 days before the date of the application, that the society maintains in the High Court a deposit as required by the Act of 1947 and, where the deposit is a guarantee bond, that it covers the whole of the period for which the licence is to be granted, and

(iii) the excise duty payable on an auctioneer's licence.

(c) An application by a society for a renewal of an auctioneer's licence shall be accompanied by an accountant's certificate in accordance with section 12 of the Act of 1947 (as inserted by section 12 of the Auctioneers and House Agents Act, 1967 ) in addition to the certificate and excise duty required by paragraph (b).

(d) Section 8 (2) of the Act of 1947 shall not apply to an application under this subsection.

(3) (a) Regulations may be made—

(i) by the Minister for Justice, after consultation with the Minister and the Central Bank, in respect of the provision by societies or their subsidiaries of auctioneering services, and

(ii) by the Minister, after consultation with the Central Bank, in respect of the provision by societies or their subsidiaries of other services relating to land.

(b) Without prejudice to the generality of paragraph (a), regulations under this subsection may include provisions for—

(i) the protection of persons for whom the services are provided by societies from conflicts of interest that might otherwise arise in connection with the provision of the services;

(ii) securing that adequate compensation is available to such persons in respect of negligence, fraud or other dishonesty on the part of officers or employees of societies in connection with the provision of the services;

(iii) the extent to which and the manner in which the services would require the involvement of persons with relevant qualifications and experience;

(iv) the class or classes of persons to whom the services may be provided;

(v) the restriction of the power to provide the services to societies of a prescribed class or classes; or

(vi) amending, restricting or extending the definition of services that may be provided under this section.

(4) No employee of a society, a subsidiary or other associated body of which provides services under this section, shall act as agent for the subsidiary or body.

(5) (a) A society or a subsidiary of a society providing auctioneering services or other services in relation to land shall maintain separate accounting records and prepare accounts in respect of each year showing—

(i) the costs of providing each service, and

(ii) the income accruing from the charges made for the services,

and shall so provide and charge for each service that the income from the provision of the service is not less than sufficient to meet all costs properly attributable to the provision of the service taking one year with another.

(b) A statement attesting the correctness of the accounts prepared in accordance with paragraph (a) and confirming that such accounts have not been distorted as a result of any arrangement which would affect the apportionment of costs and income associated with the provision of each service and that such apportionments as have been made have been properly made shall be signed by the chief executive and 2 directors and attached to the annual accounts.

(6) In this section—

(a) “auctioneering service” means any business to which the Act of 1947 relates, including the business of a house agent within the meaning of that Act;

(b) “services relating to land” means any service relating to the acquisition, disposition, management or development of land (including valuation, surveying, the collection of rent and the removal and storage of moveable property) or other services of a similar nature (including advisory services) that appear to the Central Bank to be services relating to such matters.

Power to operate outside the State.

33. —(1) Subject to section 36 , a building society may exercise its powers under this Act outside the State.

(2) In the exercise of any of its functions under this Act the Central Bank shall not be required to treat assets or liabilities of societies held outside the State as if they were held in the State.

Power to hedge.

34. —(1) A building society may, subject to subsection (2), effect contracts for the purpose of reducing the risk of loss arising from changes in interest rates, currency exchange rates or other factors of a similar nature affecting its business.

(2) The Central Bank may specify requirements as to the type or types of contract that may be effected under subsection (1) and the terms on and conditions under which such contracts may be effected, and a contract may only be effected under this section if it complies with such a specification or is otherwise approved by the Bank.

Prohibition on linking services.

35. —(1) A building society shall not make or offer to make a housing loan to any person subject to a condition that any services to which section 29 , 31 or 32 applies, and which that person may require, whether or not in connection with the loan, shall be provided by or through the society or a subsidiary or other associated body of the society.

(2) Where, in connection with a housing loan by a society, several services are made available by the society or by the society and one or more of its subsidiaries or by one or more of its subsidiaries, the society shall not, and shall secure that each of its subsidiaries does not, make the services available on terms other than terms which distinguish the consideration payable for each service so made available; nor shall any of its subsidiaries make the services available on terms other than terms which make that distinction.

Exercise of powers.

36. —(1) This section applies to the exercise by a building society or a subsidiary or other associated body of a power under any of the following sections—

(a) section 21 (holding and developing land);

(b) section 23 (1) (e) and (f) (unsecured loans or loans secured to any extent);

(c) section 28 (investment in and support of bodies corporate etc.);

(d) section 29 (financial services);

(e) section 31 (conveyancing services);

(f) section 32 (auctioneering services and services relating to land); and

(g) section 33 (power to operate abroad).

(2) Each power to which this section relates must, in order to be exercisable, be adopted by the society by special resolution and recorded in its memorandum.

(3) Notice of a special resolution under subsection (2) shall contain or be accompanied by a statement giving—

(a) a description of the activity in relation to which the power is to be exercised,

(b) the reasons for the adoption of each power, and

(c) details of such other matters as the Central Bank may require.

(4) Having adopted a power a society shall not, subject to subsection (5), exercise that power except with the approval of the Central Bank and in accordance with the terms and conditions of such approval.

(5) The Central Bank may specify, in relation to any power, circumstances in and conditions under which a power may be exercised by a society without a specific approval under subsection (4).

(6) Before a special resolution for the adoption of a power is proposed the society may consult with the Central Bank and the Bank may give a preliminary view (without prejudice to any decision under subsection (10)) as to whether and to what extent the exercise of the power would be approved by it.

(7) The Central Bank may specify such requirements as it considers necessary for societies exercising any power to which this section applies and it may specify different requirements as respects different powers.

(8) The powers in respect of which requirements are specified under subsection (7) shall not or, as the case may be, shall cease to be available to a society that does not satisfy the requirements but the cessation of compliance with such requirements by a society does not of itself impose an obligation to dispose of any property or right acquired in the exercise of the power.

(9) An application for approval under subsection (4)

(a) shall be made in such manner as the Central Bank may specify either generally or in any particular case; and

(b) shall be accompanied by such information as the Central Bank may require, either generally or in any particular case.

(10) (a) Having considered an application made in accordance with subsection (9) the Central Bank may, as it thinks proper—

(i) grant approval,

(ii) refuse to grant approval, or

(iii) grant approval subject to whatever conditions, restrictions or exclusions it considers appropriate.

(b) The Central Bank shall, within 6 months of the date of receipt of the application or of the date of the receipt of such additional information as it may require, notify the society making the application of its decision.

(11) Without prejudice to the generality of subsection (10) (a) (iii), the conditions imposed by the Central Bank may, in particular, include provisions as to—

(a) the class or classes of persons for whom a service may be provided;

(b) whether the activity may be undertaken by the society itself or by a subsidiary or other associated body;

(c) the amount of funds that may be applied by the society or its subsidiary or other associated body to the activity;

(d) whether the society may act as principal or agent in undertaking the activity;

(e) the period during which the activity may be undertaken;

(f) limits on any guarantees, bonds, contracts of suretyship or indemnities given or entered into by the society;

(g) whether and to what extent the approval of the Bank is to be obtained in respect of particular proposals, investments or undertakings;

(h) conditions which must be fulfilled as regards any subsidiary or other associated body of a society undertaking the activity;

(i) the qualifications required to be held by employees of the society or its subsidiary or other associated body undertaking the activity;

(j) the avoidance of conflicts of interest;

(k) charges to be made in relation to the provision of any service;

(l) the maintenance by the society of separate accounting records and the preparation of accounts in respect of the service being provided.

(12) As respects the exercise of powers outside the State, the conditions imposed by the Central Bank, in addition to any imposed under subsection (11), may, in particular, and without prejudice to the generality of subsection (10) (a) (iii), include provisions as to—

(a) the countries in which the power may be exercised,

(b) the forms of security which in any particular country correspond in the opinion of the Bank to the kinds of security referred to in sections 22 and 23 ,

(c) the application of any provision of this Act affecting loans to loans made outside the State with such modifications as appear to the Bank to be appropriate,

(d) requirements relating to currencies.

(13) The Central Bank shall not grant approval to an application unless it is satisfied that the relevant power has been adopted by the society in accordance with this Act.

(14) The Central Bank may at any time withdraw an approval it has granted under this section, impose conditions on an approval or revoke, vary or add to any conditions imposed but any such action by the Bank shall not require the disposal of any property or right already acquired.

(15) The Central Bank may commission an independent assessment of the capacity of a society to exercise a power for which it has sought approval and the society shall, if so directed by the Bank, defray the cost of such assessment.

(16) Where this Act, or the Central Bank in the exercise of its functions under this Act, requires that a power to provide a service may be exercised only through a subsidiary or other associated body the power to undertake that activity is to be treated as a power of the society for the purpose of section 28 .

PART IV

Control and Supervision of Building Societies by Central Bank

Duty of the Central Bank as respects building societies.

37. —(1) Subject to the general function and duty of the Central Bank under section 6 of the Central Bank Act, 1942 , the Bank shall administer the system of regulation and supervision of building societies provided for by or under this Act with a view to—

(a) the protection by each society of the funds of its shareholders and depositors, and

(b) the maintenance of the financial stability and well being of societies generally.

(2) The Central Bank shall have power to do anything which, in its opinion, is calculated to facilitate the exercise of its functions or is incidental or consequential to their exercise.

(3) The report of the Central Bank under section 36 of the Currency Act, 1927 , shall contain a report on the exercise of its functions under this Act.

Supply of mortgage finance.

38. —(1) The Minister may, from time to time as he considers necessary, review, in consultation with the Minister for Finance, the adequacy of the supply of mortgage finance for the provision or improvement of housing and communicate to the Central Bank his assessment of the need for such finance.

(2) Without prejudice to the provisions of section 6 of the Central Bank Act, 1942 , the Central Bank shall, as soon as reasonably practicable, convey its views to the Minister on this assessment together with an indication of any action it considers necessary or desirable.

(3) Every building society shall submit to the Minister such information and returns within such period as the Minister may require from time to time for the purposes of his functions in relation to the national housing programme.

Asset and liability ratios and structures.

39. —(1) A building society shall at all times keep such a proportion of its total assets in liquid form (hereinafter referred to as “liquid assets”) having such a composition as to enable the society to meet its liabilities as they arise.

(2) For the purposes of complying with subsection (1), a society shall have regard to the range and scale of its business and that of any subsidiary or other associated body and the composition and character of its assets and liabilities and those of any such body.

(3) A society may keep liquid assets in addition to those required for the purpose of complying with subsection (1).

(4) The Central Bank may from time to time require a society to maintain—

(a) a specified ratio,

(b) a ratio which does not exceed a specified ratio, or

(c) a ratio which is not less than a specified ratio,

between its assets and its liabilities and the specified ratio may be expressed as a percentage of the assets or liabilities concerned.

(5) A requirement of the Central Bank under subsection (4) may be expressed to apply—

(a) in relation to all societies or to societies of a specified category or specified categories,

(b) in relation to the total assets or total liabilities of the societies concerned or to specified assets or assets of a specified kind or specified liabilities or liabilities of a specified kind of those societies,

(c) in relation to a specified time or times or during a specified period or periods,

and shall have effect in accordance with its terms.

(6) A requirement under subsection (4) which is in force may be revoked by the Central Bank or may be amended by a subsequent requirement under that subsection.

(7) The Central Bank may, from time to time, specify as respects a society requirements as to the composition of its assets and, subject to section 18 (3), requirements as to the composition of its liabilities.

(8) In determining for the purposes of this section the assets and liabilities of a society with which another body corporate is associated, there shall be attributed to the society, in a manner acceptable to or as may be specified by the Central Bank, the whole or part of the assets and liabilities of whatever description of the associated body.

(9) (a) Subject to paragraph (b), “liquid assets” means assets specified as such for the purposes of this section by the Central Bank including deposits with the Bank.

(b) Pending a specification by the Central Bank under paragraph (a), “liquid assets” includes assets held in a form provided for by section 38 of the Building Societies Act, 1976 , notwithstanding the repeal of that Act.

(10) In this section—

(a) “specified” means specified by the Central Bank under this section,

(b) “liabilities” include such contingent liabilities as may be specified by the Central Bank from time to time for the purposes of this section.

Revocation of authorisation and giving of direction by Central Bank.

40. —(1) The Central Bank shall revoke a building society's authorisation if—

(a) the society has requested the Bank to revoke its authorisation,

(b) the society has requested the Bank to cancel its registration,

(c) the society has, under section 95 or 96 , amalgamated with or transferred all its engagements to another society, or

(d) proceedings have been commenced for the winding up of the society under section 109 .

(2) Where the Central Bank is satisfied that—

(a) a society has not made use of the authorisation within 12 months of the date on which it was granted,

(b) a society has ceased to engage in the business of a building society for more than 6 months,

(c) it is expedient to do so in the public interest or in order to protect the funds of shareholders or depositors,

(d) a society has ceased to pursue as one of its objects the making of housing loans,

(e) a society has become or is likely to become unable to meet its obligations to its creditors and shareholders or suspends payments lawfully due by it,

(f) a society has failed to send to the Bank copies of its annual accounts as required by section 82 ,

(g) a condition attached to a society's authorisation or to an approval to exercise a power under section 36 has not been complied with by the society,

(h) a society has failed to comply with a requirement of this Act or a requirement or condition of, or notice from, the Bank in the exercise of its powers under this Act,

(i) a society has been convicted on indictment of an offence under any provision of this Act or an offence involving fraud, dishonesty or breach of trust,

(j) a society no longer possesses or is not maintaining and is unlikely to be in a position to maintain adequate capital resources and in particular no longer provides security for the funds entrusted to it,

(k) since the authorisation was granted or deemed to be granted under section 17 , the circumstances relevant to the grant have changed and are such that, if an application for an authorisation were made in the changed circumstances, it would be refused, or

(l) a society obtained the authorisation through false statements or any other irregular means,

the Bank may, as it thinks proper, revoke an authorisation granted or deemed to be granted to a society under section 17 , or give a direction in writing to the society to suspend for such period, not exceeding 6 months, as shall be specified in the direction all or any of the following, that is to say—

(i) the raising of funds,

(ii) the making of payments,

(iii) the acquisition or disposal of other assets or liabilities,

which have not been authorised by the Bank.

(3) The Fourth Schedule shall apply as respects the revocation of an authorisation.

(4) The Fifth Schedule shall apply as respects a direction by the Central Bank under subsection (2).

(5) While a direction under this section is in force, no winding up proceedings in relation to the society may be commenced or resolution for winding up passed in relation to the society, no receiver over the property or over any part of the property or the undertaking of the society may be appointed and the property of the society shall not be attached, sequestered or otherwise distrained except with the prior sanction of the Court.

(6) Where the Court is satisfied, because of the nature or circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings under this section may be heard otherwise than in public.

Inspections, information, etc.

41. —(1) The Governor of the Central Bank may authorise in writing a person (an “authorised person”) being an officer of the Bank, or any other person possessing appropriate qualifications or experience, to inspect or investigate the state and conduct of the business of a building society or other body corporate which is, or was at the relevant time, a subsidiary or other associated body of a society or any particular aspect of such business and report to the Bank thereon.

(2) The Central Bank, or an authorised person, may require a society or other body as is mentioned in subsection (1) to furnish it with—

(a) such information, documents, or other material or explanation of matters, which relate to the business or the plans for the future development of the society and its subsidiary or other associated bodies, as may be specified, within a specified period or at a specified time or place; and

(b) a report by a person approved by the Bank, or the authorised person on, or on specified aspects of, information or documents, or other material so furnished.

(3) An authorised person may, on production of his authorisation if so required, at all reasonable times enter the premises of a society or other corporate body as is mentioned in subsection (1) and inspect and take copies of, or extracts from, any documents or material.

(4) A requirement under this section may be imposed on a society in relation to information, documents or other material in the possession or control of a subsidiary or associated body outside the State.

(5) The duty to produce or provide any information, document, material or explanation extends to a liquidator or any person who is or has been an officer or employee or agent of the society or other body, as the case may be, or appears to the Central Bank or the authorised person to have the information, document, material or explanation in his possession or under his control.

(6) Where any person from whom production of a document or material is required claims a lien on the document or material, the production of it shall be without prejudice to the lien.

(7) Nothing in this section shall compel the production by a barrister or solicitor of a document or material containing a privileged communication made by him or to him in that capacity or the furnishing of information contained in a privileged communication so made.

(8) The Central Bank or an authorised person may take copies of or extracts from any document or material produced in compliance with this section and require the person who produced it or any other person who is a present or past director or officer of, or is or was at any time employed by, the society or other body to provide an explanation of the document or material, and if the document or material is not produced, require the person who was required to produce it to state, to the best of his knowledge and belief, where the document or material is.

(9) In this section—

(a) “specified” means specified in a notice under this section,

(b) “agent”, in relation to a society, or any subsidiary or other body associated with it whose business is under investigation, includes its bankers, accountants, solicitors, auditors and its financial and other advisers,

(c) any reference to an officer, employee or agent of a society or other body includes a reference to a person who has been but no longer is an officer, employee or agent of that society or body.

Control of advertising.

42. —(1) If, with respect to any building society, the Central Bank considers it expedient to do so, it may give the society a direction in relation to the matter and form of any advertisement or other means of soliciting deposits or subscriptions for shares in the society or in relation to the matter and form of any advertisement relating to any service provided or business being undertaken by the society and may direct the society to withdraw an advertisement or to cease advertising.

(2) Without prejudice to the generality of subsection (1), a direction under this section may do all or any of the following—

(a) prohibit the issue by the society of advertisements of all descriptions or any specified description,

(b) require the society to modify advertisements of a specified description in a specified manner,

(c) prohibit the issue by the society of any advertisements which are, or are substantially, repetitions of a specified advertisement,

(d) require the society to withdraw any specified advertisement or any advertisement of a specified description, or

(e) require the society to include specified information in any advertisement to be published by it or on its behalf or in any statement to the public to be made by it or on its behalf.

(3) In this section—

(a) “advertisement” includes every form of recommendation of any matter to which this section relates, including in particular the display or publication of any such matter by way of leaflet, notice, circular, pamphlet, brochure, photograph, film, video, sound broadcasting, television, electronic communication or personal canvassing and references to the issue of advertisements shall be construed accordingly; and

(b) “specified” means specified in a direction under this section.

Power of Court to prohibit certain contraventions of Act.

43. —(1) Where, on an application made in a summary manner by the Central Bank, the Court is of the opinion that there has occurred or is occurring—

(a) a contravention of this Act,

(b) a failure to comply with a condition imposed in relation to an authorisation by virtue of section 17 , or with a direction under section 40 or 42 , or

(c) a failure to comply with a condition imposed on an approval under section 36 to exercise an adoptable power,

the Court may, by order, prohibit the continuance of the contravention or failure by the person or persons concerned, or in the case of paragraph (c), require the cessation of the exercise of the adoptable power.

(2) The Court when considering the application may make such interim or interlocutory order as it considers appropriate.

(3) The foregoing provisions of this section are without prejudice to the general functions of the Central Bank.

(4) Where the Court is satisfied, because of the nature or circumstances of the case or otherwise in the interests of justice, that it is desirable, the whole or any part of proceedings under this section may be held otherwise than in public.

Disclosure of information.

44. —(1) A person, who at the commencement of this section is, or at any time thereafter is appointed, Governor, or a Director, officer or servant of the Central Bank, or who is employed by the Bank in any other capacity, shall not disclose, during his term of office or employment or at any time thereafter, any information concerning the business of any building society or any of its subsidiaries or other associated bodies which may come to his knowledge by virtue of his office or employment unless such disclosure is to enable the Bank to carry out its functions.

(2) The provisions as to non-disclosure contained in subsection (1) shall not apply to any disclosure—

(a) required by a court in connection with any criminal proceedings,

(b) made with the consent of the person to whom the information relates and, where not the same person, of the person from whom that information was obtained,

(c) where the Central Bank is acting or has acted in the capacity of an agent for a person, made to the person in respect of that capacity,

(d) where the Bank considers it necessary for the common good, made to any person charged by law with the supervision of financial institutions (whether or not entitled to take money on deposit from the public) and who, in the opinion of the Bank, has obligations duly imposed in respect of non-disclosure of information and corresponding to obligations under this section,

(e) made to an authority in a foreign jurisdiction duly authorised to exercise functions in that jurisdiction which correspond to the functions of the Bank under this Part and section 17 and which, in the opinion of the Bank, has obligations duly imposed in respect of non-disclosure of information and corresponding to obligations under this section,

(f) made to any institution of the European Communities for the purpose of the State's membership of any of those Communities,

(g) in the form of a summary or collection of information so framed as not to enable information relating to any particular body or person to be ascertained from it,

(h) which, in the opinion of the Bank, is necessary for the protection of the funds of shareholders in or depositors with a building society or to safeguard the interests of the Bank,

(i) made to the Minister, for the purposes of his functions in relation to the national housing programme.

(3) After the commencement of this section, every person who is appointed as Governor, or a Director, officer or servant of the Central Bank, or who is employed by the Bank in any other capacity, shall—

(a) before entering into the office or employment, be informed by the Bank of his obligations under this section, and

(b) acknowledge that he has been so informed and understands his obligations,

in such manner as the Bank shall determine.

(4) A person who contravenes subsection (1) shall be guilty of an offence and shall be liable—

(a) on summary conviction to a fine not exceeding £1,000 or, at the discretion of the court, to imprisonment for a term not exceeding 12 months, or to both, or

(b) on conviction on indictment to a fine not exceeding £25,000 or, at the discretion of the court, to imprisonment for a term not exceeding 5 years, or to both.

(5) In any proceedings for an offence under this section, it shall not be necessary to prove that the provisions of subsection (2) do not apply and the onus of proving that any of those provisions do apply shall be on the person seeking to avail himself thereof.

Appointment of inspector and calling of special meeting.

45. —(1) Where—

(a) an application is made to the Central Bank by not less than one-tenth of the total number of members of a building society entitled to vote pursuant to section 69 (1) (a) or 200 such members, whichever is the lesser; or

(b) the Central Bank is of the opinion that an investigation should be held into the affairs of a society or that the affairs of the society call for consideration by a meeting of the members of the society;

the Bank, as it thinks proper, may appoint one or more inspectors to investigate the affairs of the society and, where necessary, any subsidiary or other associated body and to report thereon in such manner as it directs, or may call a special meeting of the society.

(2) The Central Bank may, either on the same or on different occasions, both appoint an inspector and call a meeting under subsection (1).

(3) (a) An application under this section shall be supported by such evidence as the Central Bank may direct, for the purposes of showing that the applicants have good reason for requiring the investigation to be made or the meeting to be called and that they are not actuated by malicious motives in their application.

(b) Such notice of the application shall be given to the society and, in a case where the investigation is to extend to its affairs also, to the subsidiary or associated body of the society, as the Central Bank may direct.

(c) The Central Bank may require the applicants to give security for payment of the costs of the investigation or meeting before the inspector is appointed or the meeting is called subject, in the case of the costs of an investigation, to an amount not exceeding £200,000.

(d) As regards the expenses of and incidental to the investigation or meeting, the expenses shall be defrayed by the applicants or out of the funds of the society or by the members or officers or former members or officers of the society in such proportions as the Central Bank may direct but, in the case of an investigation (in whichever way instituted), the expenses may be defrayed in the first instance by the Bank but without prejudice to its rights to contribution under section 46 .

(4) (a) The Central Bank may give such directions as it thinks fit in relation to the calling, holding and conduct of a meeting held under this section (including the time and place of the meeting and the matters to be discussed and determined at the meeting).

(b) The Central Bank shall appoint a person to be chairman of the meeting.

(c) The meeting shall have all the powers of a meeting called according to the rules of the society.

(d) This subsection shall have effect notwithstanding anything in the rules of the society.

(5) Before appointing an inspector or calling a meeting under this section the Central Bank may, if it is of the opinion that it would not be prejudicial to the interests of members or creditors, notify the society in writing of the action which it proposes to take and of the grounds on which it proposes to take it and, in such a case, the society shall, within 14 days of the receipt of the notification, be entitled to give to the Bank an explanatory statement in writing.

(6) Where an inspector appointed under this section thinks it necessary for the purposes of his investigation to investigate also the affairs of any other society or any body corporate which is or has at any relevant time been a subsidiary of, or associated with, the first-mentioned society, he shall, with the approval of the Central Bank, have power to do so, and shall report on the affairs of the other society or body corporate so far as he thinks the results of his investigation thereof are relevant to the investigation of the affairs of the first-mentioned society.

Provisions supplemental to section 45 .

46. —(1) It shall be the duty—

(a) of all officers, members and agents of a society or other body the affairs of which are being investigated under section 45 , and

(b) of any other person who the inspector considers is or may be in possession of any information concerning the affairs of the society or body,

to produce to him all books, accounts, deeds, records or other documents of, or relating to, the society or body which are in their power, possession or procurement, to attend before the inspector when required to do so and otherwise to give to him all assistance in connection with the investigation which they are reasonably able to give.

(2) The inspector may examine on oath the officers, members and agents of the society or other body being investigated and any such person as is mentioned in subsection (1) in relation to its affairs and may administer an oath accordingly.

(3) If an inspector has reasonable grounds for believing that a director or past director of the society whose affairs the inspector is investigating maintains or has maintained a bank account of any description, whether alone or jointly with another person and whether in the State or elsewhere, into or out of which there has been paid—

(a) any money which has resulted from or been used in the financing of any transaction, arrangement or agreement particulars of which were not included in the register of certain transactions and arrangements as required by section 59 ; or

(b) any money which has been in any way connected with any act or omission, or series of acts or omissions, which on the part of that director constituted misconduct (whether fraudulent or not) towards that society or its members;

the inspector may require the director or past director to produce to him all documents in the director's possession, or under his control, relating to that bank account and in this subsection “bank account” includes an account with any person exempt by virtue of section 7 (4) of the Act of 1971 from the requirement of holding a licence under section 9 of that Act.

(4) If any officer, member or agent of the society or other body or any such person as is mentioned in subsection (1) refuses to produce to the inspector any book or document which it is his duty under this section to produce, refuses to attend before the inspector when required to do so, or refuses to answer any question put to him by the inspector with respect to the affairs of the society, or other body, as the case may be, he shall be guilty of an offence.

(5) Nothing in this section—

(a) shall compel the production by a barrister or solicitor of a document or material containing a privileged communication made by him or to him in that capacity or the furnishing of information contained in a privileged communication so made, or

(b) shall require the disclosure by a bank or a building society of any information as to the affairs of any of its customers other than the society or body the affairs of which are being investigated.

(6) In this section any reference to officers or to agents shall include past as well as present officers and agents, as the case may be, and “agents”, in relation to a society or other body, shall include the bankers, accountants, solicitors, auditors and the financial and other advisors of the society or other body.

(7) The Central Bank shall be entitled to be repaid the expenses of the investigation defrayed by it under section 45 (3) (d) as follows, that is to say—

(a) by the applicants for the investigation to such extent (if any) as the Bank may direct;

(b) by any body whose affairs were the subject of the investigation to such extent (if any) as the Bank may direct; or

(c) by a person convicted of an offence in proceedings instituted as a result of the investigation to such extent (if any) as the court by or before which he was convicted may order; and a person liable under any one of paragraphs (a) to (c) is entitled to contribution from any other person liable under the same paragraph according to the amount of their respective liabilities under it.

Inspectors' reports and proceedings thereon.

47. —(1) An inspector appointed under section 45 may, and shall if the Central Bank so requires, make an interim report to the Bank and, on conclusion of the investigation, shall make a final report to the Bank, but he may at any time in the course of the investigation, without making an interim report, inform the Bank of matters coming to his knowledge as a result of the investigation.

(2) The Central Bank shall—

(a) forward a copy of any report made by an inspector under this section to the Minister, and the Minister for Finance;

(b) if it thinks fit, furnish a copy thereof to the society and its auditors;

(c) if it thinks fit, furnish a copy thereof, on request and on payment of such fee as it may fix, to any other person who is a member of the society or of any other body corporate dealt with in the report by virtue of section 45 or whose interests as a creditor of the society or of any such other body corporate appear to the Bank to be affected;

(d) if it thinks fit, at the request of the applicants for the investigation, furnish a copy to them on payment of such fee as may be fixed by the Bank.

(3) The Minister may lay the report under subsection (1) before each House of the Oireachtas and such publication shall be privileged and a report not so laid may be printed and published by the Central Bank.

(4) (a) Where it appears to the Central Bank that any person has, in relation to the society or any body corporate the affairs of which have been investigated under section 45 , been guilty of any offence for which he is criminally liable, the Bank shall refer the matter to the Director of Public Prosecutions.

(b) Where the Director of Public Prosecutions institutes proceedings consequent on the receipt by him of a report under paragraph (a), it shall be the duty of all officers, members and agents of the society or any body corporate (other than the defendants in the proceedings) to give him all assistance in connection with the prosecution which they are reasonably able to give.

(5) Where it appears to the Central Bank after consideration of an inspector's report under subsection (1) that it is expedient to do so it may, unless the society is being wound up by the Court, petition the Court for an order to wind up the society under section 109 .

(6) Where it appears to the Central Bank after consideration of an inspector's report under subsection (1) that proceedings ought in the public interest to be brought by the society for damages, in respect of any fraud, misfeasance or other misconduct in connection with the promotion or formation of the society or the management of its affairs, or for the recovery of any property misapplied or wrongfully retained, the Bank may itself bring proceedings for that purpose in the name of the society.

(7) The Central Bank may indemnify the society against any costs or expenses incurred by it in, or in connection with, any proceedings brought under subsection (6).

(8) A copy of any report of an inspector appointed under section 45 shall be admissible in any legal proceedings as evidence of the opinion of the inspector in relation to any matter contained in the report.

PART V

Management of Building Societies

Directors.

48. —(1) A building society shall have at least 3 directors.

(2) A society shall not have as a director a body corporate.

(3) The directors shall appoint from among their number a chairman of the board of directors.

(4) The chairman of the board of directors shall not also be the chief executive of the society except with the consent of the Central Bank.

Chief executive and secretary.

49. —(1) A building society shall have—

(a) a chief executive who, either alone or jointly with one or more other officers of the society, shall be responsible, under the immediate authority of the board of directors, for the conduct of the business of the society; and

(b) a secretary.

(2) The offices of chief executive and secretary may not be held by the same person except with the consent of the Central Bank.

(3) The chief executive and the secretary of a society shall be appointed by the board of directors of the society who shall take all reasonable steps to ensure that the persons appointed are persons who have the knowledge and experience to discharge the functions of those offices.

(4) The board of directors of a society shall give to the Central Bank prior notice of a proposal to appoint a person as chief executive stating the person's full name and address, the date on which he is to take office and such other information as the Bank may require and the Bank shall record the person's name and the date on which he begins to hold office in the public file of the society.

(5) Where a person ceases to hold office as chief executive the board shall, as soon as may be, give notice of that fact to the Central Bank which shall record it in the public file of the society.

(6) Anything required or authorised to be done by or in respect of the chief executive or secretary may, if the office is vacant or there is for any other reason no chief executive or secretary capable of acting, be done by or in respect of any deputy or assistant chief executive or secretary, as the case may be, or if there is no deputy or assistant capable of acting, by or in respect of any officer of the society authorised generally or specially for that purpose by the directors.

(7) Where the chief executive is also a director he may be referred to as the managing director.

Directors: appointment and retirement.

50. —(1) Subject to subsections (11) and (16), the directors of a building society must be elected to office either—

(a) at an annual general meeting of the society, or

(b) by postal ballot conducted during the period of 3 months preceding the date on which the annual general meeting is held,

as the rules provide.

(2) Where subsection (1) (a) applies and the number of candidates for the office of director exceeds the number of vacancies, the election of directors shall be by poll.

(3) The persons entitled to vote in an election of directors are those members of the society who in accordance with section 69 and under the rules are entitled to vote on an ordinary resolution.

(4) A person entitled to vote in an election of directors cannot be required to cast all or any of his votes.

(5) A person who is not a member of a society may, if its rules so provide, be a director.

(6) The rules of a society may impose, as a condition of a person's eligibility to be or to be nominated for election as a director of the society, a requirement that he shall hold beneficially shares in the society not less in value than the amount specified by the rules, but the maximum holding that may be required shall not exceed £500, or such other amount as may be substituted for it in regulations made by the Central Bank.

(7) The rules of a society shall not require, as conditions of the validity of a person's nomination for election as a director, that—

(a) more than 20 members join in nominating him;

(b) a nominating member be a member for more than 2 years before the date of the nomination or hold, or have at any time during that period held, shares in the society to a value greater than £250; or

(c) more than £250 be deposited with the society in connection with his candidature.

(8) The rules of a society shall not impose, as conditions of the validity of a person's nomination for election as a director, conditions in relation to matters other than those in subsections (6) and (7) except as may be approved by the Central Bank as being reasonable.

(9) The Central Bank may, by regulation, substitute for the number, the maximum period of membership, the maximum value of shares, and the maximum amount of the deposit referred to in subsection (7), such other number, period, value, or amount as it thinks appropriate.

(10) A director, other than a director who is also the chief executive of a society, shall retire from office not later than the end of the third annual general meeting of the society following the date of his election, subject to any provision in this Act or in the rules of the society for his earlier retirement and such director shall be eligible for election without nomination, subject to the rules.

(11) If the rules of a society so provide, the directors for the time being may co-opt as director to fill any vacancy on the board of directors any person who—

(a) appears to them to be fit and proper to be a director, and

(b) is not disqualified under section 64 to be a director of a building society,

not being a person who, having stood for election as a director at any election held within the preceding 16 months, was not elected as a director.

(12) A person who is co-opted under subsection (11) shall cease to hold office at the end of the next annual general meeting following his appointment, but a general meeting shall be disregarded for the purposes of this subsection if the closing date for the nomination of candidates falls before the date of the co-opted director's appointment, but he shall retire as a co-opted director at the next annual general meeting following that which is disregarded and shall be eligible for election without nomination, subject to the rules.

(13) Where in an election of directors there is a poll, whether conducted at a meeting or by way of postal ballot, the papers issued by the society for the purposes of or relating to the poll shall—

(a) show with equal prominence the name of each candidate, and

(b) arrange the names alphabetically in the order of the surnames, or if there are 2 or more candidates bearing the same surname, in the alphabetical order of their other names together with such information as will distinguish such candidates.

(14) The acts of a director shall be valid notwithstanding any defects which may afterwards be discovered in his appointment or qualification.

(15) A society shall notify the Central Bank—

(a) of all valid nominations of persons for election as directors, as soon as possible after the closing date for nominations; and

(b) of the proposed co-option of persons as directors at least 14 days before the date of the appointment;

giving in each case the information referred to in section 66 (1) and such other information as the Bank may require.

(16) The persons mentioned in section 10 (2) or a majority of them may appoint as directors to hold office until the conclusion of the first annual general meeting persons not disqualified under section 64 .

(17) In this section, “ordinary resolution”, means a resolution which will be effective without being passed as a special resolution or a conversion resolution.

Directors: supplementary provisions as to elections, etc.

51. —(1) A building society shall give notice of the latest date for the receipt of nominations for election as a director in either of the following ways—

(a) by publishing it in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated and such notice shall be published not earlier than 42 days before such date; or

(b) by sending it, not earlier than the date on which notices are issued for the preceding year's annual general meeting to all members who would at the date of the notice be entitled to notice of an election of directors,

as the rules provide, and in either case the notice shall be published or sent, as the case may be, not later than 21 days before the latest date for the receipt of nominations.

(2) If a duly nominated candidate for election as a director of a society furnishes the society with an election address of not more than 300 words before the closing date for nominations, then, subject to subsection (3)

(a) it shall be the duty of the society, at its expense, to send a copy of the address to each member of the society who is entitled to notice of the election; and

(b) each member's copy shall be sent in the same manner and, so far as practicable, at the same time as the notice of the meeting at which the election is to be conducted or the ballot papers are sent out, as the case may be;

but failure to comply with a requirement of this subsection shall not of itself invalidate the election.

(3) Subsection (2) does not require a society to send copies of an address to members of the society in any case where—

(a) the contents of the address would be likely to diminish substantially public confidence in the society, or

(b) the rights conferred by that subsection are being abused to seek needless publicity for defamatory matter or for frivolous or vexatious purposes,

and that subsection shall not be taken to confer any rights on members, or to impose any duties on a society, in respect of an address which does not relate directly to the affairs of the society.

(4) Where the society refuses, or proposes to refuse, to circulate an election address, the society shall, within 7 days after the receipt of the address, notify the member who furnished it of such refusal and the grounds for the refusal and the said member may, within 7 days of the refusal, refer the refusal to the Central Bank who may direct the society to comply with the request subject to such conditions as the Bank may require.

(5) (a) The person appointed under the rules of a society to supervise the conduct of an election of directors shall prepare and submit to the Central Bank a report on the conduct of the election—

(i) stating whether in his opinion the election was conducted in accordance with the provisions of this Act, regulations made thereunder and the rules and otherwise with fairness and integrity;

(ii) containing details of the number of proxy instruments received, the number declared invalid categorised by cause of invalidation and the number of votes attributable to valid instruments; and

(iii) containing such other information as may be required by the Bank.

(b) The Central Bank may, as it thinks proper, disclose some or all of the contents of a report under paragraph (a) to a duly nominated candidate.

(6) A society shall retain for a period of one year from the date of the election all ballot papers and all its documents and records relating to an election of directors.

(7) The Central Bank may, following consideration of the report made to it under subsection (5), if it thinks proper, apply to the Court for an order setting aside the result of an election of directors and directing the society to hold another election.

(8) An employee, other than an officer, of a society, not being himself a candidate, who, at the place of his employment or of a meeting of the society, solicits support for a candidate for election as a director or invites a member of the society to appoint as his proxy any particular person to vote in an election shall be guilty of an offence and shall be liable on conviction to a fine not exceeding £300.

Connected persons.

52. —(1) For the purposes of this Part, a person is connected with a director of a building society if, but only if, he is—

(a) that director's spouse, parent, brother, sister or child; or

(b) a body corporate with which the director is associated; or

(c) a person acting in his capacity as the trustee (other than as trustee under an employees' share scheme or a pension scheme) of any trust the beneficiaries of which include the director, his spouse or any of his children or a body corporate with which he is associated or the terms of which confer a power on the trustees that may be exercised for the benefit of the director, his spouse or any of his children or any such body corporate; or

(d) a person acting in his capacity as partner of that director or of any person who, by virtue of paragraph (a), (b) or (c) is connected with that director;

unless that person is also a director of the society.

(2) A director of a society is associated with a body corporate if he and his spouse, parent, brother, sister or child or a person acting in his capacity as trustee of any trust the beneficiaries of which include the director, his spouse or any of his children between them either—

(a) own at least one-fifth of that body's equity share capital within the meaning of the Companies Act, 1963 , or

(b) are entitled to exercise or control the exercise of more than one-fifth of the voting power of that body at any general meeting.

(3) In subsection (1)child” includes a step-child and “son”, “daughter” and “parent” shall be construed accordingly.

Disclosure by directors of interests in contracts.

53. —(1) It shall be the duty of a director of a building society who is in any way, whether directly or indirectly, interested in a contract or proposed contract with the society to declare the nature of his interest at a meeting of the directors of the society.

(2) In a case of a proposed contract, the declaration shall be made—

(a) at the meeting of the directors at which the question of entering into the contract is first considered; or

(b) if the director was not at the date of that meeting interested in the proposed contract, at the next meeting of the directors held after he becomes so interested.

(3) Where the director becomes interested in a contract after it is made, the declaration shall be made at the first meeting of the directors held after the director becomes so interested.

(4) If the contract is not one that will be considered at a meeting of the directors, the declaration shall be made as soon as may be.

(5) Subject to subsection (6), for the purposes of this section, a general notice given to the directors of a society by a director to the effect that—

(a) he is a member of a specified company or firm and is to be regarded as interested in any contract which may, after the date of the notice, be made with that company or firm; or

(b) he is to be regarded as interested in any contract which may after the date of the notice be made with a specified person who is connected with him,

shall be deemed to be sufficient declaration of interest in relation to any such contract.

(6) A notice under subsection (5) shall not be of effect unless either it is given at a meeting of the directors or the director takes reasonable steps to secure that it is brought up and read at the next meeting of the directors after it is given.

(7) A copy of every declaration made and notice given under this section shall, within 3 days (not including a Saturday, a Sunday or a public holiday) after being made or given, be entered in a register kept for the purpose and this register shall be open for inspection without charge by any officer, auditor or member of the society at the chief office of the society and shall be available at every general meeting of the society, and at any meeting of the directors if any director so requests in sufficient time to enable the register to be available at the meeting.

(8) The provisions of this section apply in relation to any transaction or arrangement as they apply to a contract and, for the purposes of this section, a transaction or arrangement of a kind described in section 57 made by a society for a director of the society or a person connected with such a director shall, if it would not otherwise be so treated (and whether or not prohibited by that section), be treated as a transaction or arrangement in which that director is interested.

(9) Nothing in this section shall affect the operation of any rule of law restricting directors of a society from having any interest in contracts with the society.

Contracts of employment of directors.

54. —(1) A building society shall not incorporate in any agreement a term to which this section applies unless the term is first approved by a resolution of the society in general meeting.

(2) This section applies to any term by which a director's employment with the society of which he is a director is to continue, or may be continued, otherwise than at the instance of the society, (whether under the original agreement or under a new agreement entered into in pursuance of the original agreement) for a period exceeding 5 years during which the employment—

(a) cannot be terminated by the society by notice, or

(b) can be so terminated only in specified circumstances.

(3) In any case where—

(a) a person is or is to be employed with a society under an agreement which cannot be terminated by the society by notice or can be so terminated only in specified circumstances, and

(b) more than 6 months before the expiration of the period for which he is or is to be so employed, the society enters into a further agreement (otherwise than in pursuance of a right conferred by or by virtue of the original agreement on the other party thereto) under which he is to be employed with the society,

subsection (2) shall apply as if to the period for which he is to be employed under that further agreement there were added a further period equal to the unexpired period of the original agreement.

(4) A resolution of a society approving a term to which this section applies shall not be passed at a general meeting of the society unless a written memorandum setting out the proposed agreement incorporating the term is available for inspection by members of the society both—

(a) at its chief office during the period of 15 days expiring on the date of the meeting, and

(b) at the meeting itself.

(5) A term incorporated in an agreement in contravention of this section shall to the extent that it contravenes this section be void and that agreement and, in a case where subsection (3) applies, the original agreement shall be deemed to contain a term entitling the society to terminate it at any time by the giving of reasonable notice.

(6) In this section, “employment” includes employment under a contract for services.

Inspection of directors' service contracts.

55. —(1) Subject to this section, a building society shall keep at its chief office a register containing—

(a) in the case of each director who has a contract of service with the society, a copy of that contract if in writing;

(b) in the case of each director whose contract of service with the society is not in writing, a written memorandum setting out the terms of that contract;

(c) in the case of a director who has a contract of service with a subsidiary of the society, a copy of that contract or, if it is not in writing, a written memorandum setting out its terms.

(2) Subsection (1) shall not apply in relation to a director's contract of service with the society or with a subsidiary of the society if that contract required him to work wholly or mainly outside the State, but the society shall keep at its chief office a memorandum—

(a) in the case of a contract of service with the society, setting out the name of the director and the provisions of the contract relating to its duration;

(b) in the case of a contract of service with a subsidiary of the society, setting out the name of the director, the name and place of incorporation of the subsidiary and the provisions of the contract relating to its duration.

(3) Every copy and memorandum required to be kept by subsections (1) and (2) shall, during business hours (subject to such reasonable restrictions as the society may in general meeting impose, so that not less than 2 hours in each day be allowed for inspection), be open to the inspection of any member of the society without charge.

(4) If default is made in complying with subsection (1) or (2) or if an inspection required under subsection (3) is refused, the society and every officer of the society who is in default shall be liable on summary conviction to a fine not exceeding £1,000, and, for continued contraventions, to a daily default fine not exceeding £50.

(5) Subsections (1) and (2) shall apply to a variation of a director's contract of service with a society and a contract of service with a subsidiary of a society as it applies to the contract.

(6) This section shall not require to be kept a copy of, or memorandum setting out the terms of, a contract or a copy of, or memorandum setting out the terms of, a variation of a contract at a time at which the unexpired portion of the term for which the contract is to be in force is less than 3 years or at a time at which the contract can, within the next ensuing 3 years, be terminated by the society without payment of compensation.

Substantial property transactions involving directors and connected persons.

56. —(1) A building society shall not enter into an arrangement—

(a) whereby a director of the society or a person connected with such a director acquires or is to acquire one or more non-cash assets of the requisite value from the society; or

(b) whereby the society acquires or is to acquire one or more non-cash assets of the requisite value from such a director or a person so connected;

unless the arrangement is first approved by a resolution of the society in general meeting.

(2) For the purposes of this section a non-cash asset is of the requisite value if at the time the arrangement in question is entered into its value is not less than £50,000 or, in the case of a society with reserves of less than £500,000, is not less than 10 per cent. of the reserves.

(3) In this section “non-cash asset” means any property or interest in property other than cash and for this purpose “cash” includes foreign currency; and a reference to the acquisition of a non-cash asset includes a reference to the creation or extinction of an estate or interest in, or a right over, any property and also a reference to the discharge of any person's liability other than a liability for a liquidated sum.

(4) An arrangement entered into by a society in contravention of this section and any transaction entered into in pursuance of the arrangement (whether by the society or any other person) shall be voidable at the instance of the society unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible or the society has been indemnified in pursuance of subsection (5) (b) by any other person for the loss or damage suffered by it;

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person who is not a party to the arrangement or transaction would be affected by its avoidance; or

(c) the arrangement is, within a reasonable period, affirmed by the society in general meeting.

(5) Without prejudice to any liability imposed otherwise than by this subsection, but subject to subsection (6), where an arrangement is entered into with a society by a director of the society or a person connected with him in contravention of this section, that director and the person so connected, and any other director of the society who authorised the arrangement or any transaction entered into in pursuance of such an arrangement, shall (whether or not it has been avoided in pursuance of subsection (4)) be liable—

(a) to account to the society for any gain which he had made directly or indirectly by the arrangement or transaction; and

(b) jointly and severally with any other person liable under this subsection, to indemnify the society for any loss or damage resulting from the arrangement or transaction.

(6) Where an arrangement is entered into by a society and a person connected with a director of the society in contravention of this section, that director shall not be liable under subsection (5) if he shows that he took all reasonable steps to secure the society's compliance with this section and, in any case, a person so connected and any such other director as is mentioned in that subsection shall not be so liable if he shows that, at the time the arrangement was entered into, he did not know the relevant circumstances constituting the contravention.

Restrictions on loans etc. to directors and connected persons.

57. —(1) Subject to this section, a building society shall not—

(a) make a loan to a director or a person connected with a director of the society;

(b) dispose of property by way of lease or hire to a director or a person connected with a director of the society;

(c) make a payment on behalf of a director or a person connected with a director of the society in connection with the provision of any services under Part III ;

(d) enter into any guarantee or provide any security which is incidental to or connected with any such loan, disposal of property or payment; or

(e) take part in any arrangement whereby—

(i) another person enters into a transaction which if it had been entered into by the society would have contravened any of paragraphs (a) to (d), and

(ii) that other person, in pursuance of the arrangement, has obtained or is to obtain any benefit from the society or a subsidiary of the society.

(2) Subsection (1) (a) does not apply to—

(a) any loan the amount of which when aggregated with any other relevant loans does not exceed £2,500;

(b) any loan made in the ordinary course of the society's business, the amount of which is not greater, and the terms on which it is made are not more favourable, than it is reasonable to expect the society to have offered to a person of the same financial standing but not connected with the society;

(c) any loan, the amount of which, when aggregated with any other relevant loans, does not exceed £50,000 made for or towards the purchase or improvement of a house used or to be used as the director's only or main residence and provided that loans of that description and on similar terms are ordinarily made to employees of the society.

(3) Subsection (1) (b) does not apply to any lease or hiring of property—

(a) the value of which when aggregated with the value of any other relevant leases or hirings does not exceed £5,000;

(b) which is made in the ordinary course of the society's business and is on terms not more favourable than it is reasonable to expect the society to have offered to a person unconnected with the society.

(4) Subsection (1) (c) does not apply to any payment—

(a) amounting, when aggregated with any other relevant payments, to no more than £1,000 in respect of which the person on whose behalf it is made is under an obligation to reimburse the society within a period not exceeding 2 months beginning with the date of the payment; or

(b) of an amount not greater and on other terms not more favourable than it is reasonable to expect the society to have offered to a person of the same financial standing but not connected with the society.

(5) Subject to compliance with the requirements of subsection (6), subsection (1) does not preclude a society from doing anything to provide a director with funds to meet expenditure incurred or to be incurred by him for the purposes of the society or for the purpose of enabling him properly to perform his duties as a director of the society nor does it preclude the society from doing anything to enable a director to avoid incurring such expenditure.

(6) The following are the requirements referred to in subsection (5)

(a) the things must either be done with the prior approval of the society given at a general meeting at which the requisite matters are disclosed or be done on condition that, if the approval of the society is not so given at the next annual general meeting, the loan is to be repaid, or any other liability arising under the transaction is to be discharged, within 6 months from the conclusion of that meeting; and

(b) the amount provided, when aggregated with any other relevant provision of funds, does not exceed £10,000.

(7) The following are the requisite matters which must be disclosed for the purposes of subsection (6) above—

(a) the purpose of the expenditure incurred or to be incurred, or which would otherwise be incurred, by the director;

(b) the amount of the funds to be provided by the society; and

(c) the extent of the society's liability under any transaction which is or is connected with the thing in question.

(8) A transaction or arrangement falling within subsection (1) is, for the purposes of this Part, made for a person if—

(a) in the case of a loan, disposal or payment within paragraph (a), (b) or (c) of subsection (1), it is made, in the case of paragraph (a) or (b) to him or, in the case of paragraph (c), on his behalf;

(b) in the case of a guarantee or security within paragraph (d), it is made as an incident of or in connection with a loan or disposal to him or a payment on his behalf; or

(c) in the case of an arrangement within paragraph (e), the transaction to which the arrangement relates was made for him.

(9) In this section—

relevant”, in relation to a transaction of a description falling within paragraph (a), (b) or (c) of subsection (1), means an outstanding or, in the case of a lease or hiring, current transaction of that description (whether entered into by, or by arrangement with, the society), not being one authorised by any other authorising provision;

authorising provision” and “authorised”, in relation to a transaction of a description falling within paragraph (a), (b) or (c) of subsection (1), mean respectively any provision of subsection (2), (3) or (4) or constituted by subsection (5) and any transaction or thing done to which that paragraph does not apply or which is not precluded from being done by virtue of that provision;

outstanding”, in relation to loans, means outstanding in respect of any principal or interest and, in relation to the provision of funds subject to a condition for repayment or discharge of any other liability, means unpaid or undischarged to any extent;

provision of funds” includes anything else which, by virtue of subsection (5), a society is not precluded from doing by subsection (1).

Sanctions for breach of section 57 .

58. —(1) Where a building society enters into a transaction or arrangement contravening section 57 the transaction or arrangement shall be voidable at the instance of the society unless—

(a) restitution of any money or any other asset which is the subject matter of the arrangement or transaction is no longer possible, or the society has been indemnified in pursuance of subsection (2) (b) for the loss or damage suffered by it; or

(b) any rights acquired bona fide for value and without actual notice of the contravention by any person other than the person for whom the transaction or arrangement was made would be affected by its avoidance.

(2) Without prejudice to any liability imposed otherwise than by this subsection but subject to subsection (3), where a transaction or arrangement contravening section 57 is made by a society for a director of the society or a person connected with such a director that director and the person so connected and any other director of the society who authorised the transaction or arrangement (whether or not it has been avoided in pursuance of subsection (1) is liable—

(a) to account to the society for any gain which he has made directly or indirectly by the transaction or arrangement; and

(b) jointly and severally with any other person liable under this subsection, to indemnify the society for any loss or damage resulting from the transaction or arrangement.

(3) Where a transaction or arrangement contravening section 57 is entered into by a society and a person connected with a director of the society, that director shall not be liable under subsection (2) if he shows that he took all reasonable steps to secure the society's compliance with that section and, in any case, a person so connected and any such other director as is mentioned in subsection (2) shall not be liable if he shows that, at the time the transaction or arrangement was entered into, he did not know the circumstances constituting the contravention.

(4) An officer of a society who authorises or permits the society to enter into a transaction or arrangement knowing or having reasonable cause to believe that the society was thereby contravening section 57 shall be guilty of an offence.

(5) A society which enters into a transaction or arrangement contravening section 57 for one of its directors shall be guilty of an offence unless it shows that, at the time the transaction or arrangement was entered into, it did not know the circumstances constituting the contravention.

(6) A person who procures a society to enter into a transaction or arrangement knowing or having reasonable cause to believe that the society was thereby contravening section 57 shall be guilty of an offence.

Records of loans etc. falling within section 57 .

59. —(1) A building society shall maintain a register containing a copy of every subsisting transaction or arrangement (other than a transaction or arrangement excepted by subsection (6)) falling within section 57 (1) made for a director or a person connected with a director of the society during the current financial year or any of the preceding 10 financial years, but excluding years prior to 1989.

(2) In the case of a transaction or arrangement which is not in writing, there shall be kept in the register a written memorandum setting out its terms.

(3) A society shall make available for inspection by members—

(a) at its chief office during the period of 15 days expiring on the date of its annual general meeting, and

(b) at the annual general meeting,

a statement containing the requisite particulars of the transactions and arrangements falling within section 57 (1) which were included in the register under subsection (1) at any time during the last complete financial year preceding the meeting.

(4) Two copies of the statement required to be so made available to members shall be sent by the society to the Central Bank (together with the auditor's report as required by subsection (8)) not later than the date on which the statement is required to be first made available to members and the Bank shall keep one of them in the public file of the society.

(5) A copy of the latest statement required to be so made available shall also be sent by the society, on demand and on payment of a fee which may be specified by the Central Bank, to any member of the society.

(6) There are excepted from the obligations imposed by this section on a society with respect to a financial year all transactions or arrangements made or subsisting during that year for a person who was at any time during that year a director of the society or was connected with a director of the society if the aggregate of the values of each transaction or arrangement made for that person and of each agreement for such a transaction or arrangement, less the amount (if any) by which the value of those transactions or arrangements has been reduced, did not exceed £1,000 at any time during that year.

(7) The “requisite particulars” of a transactions or arrangement required by subsection (3) are such particulars of the terms of the transaction or arrangement, as may be specified from time to time by the Central Bank.

(8) It shall be the duty of the auditors of a society to examine the statement required under subsection (3) before it is made available to the members of the society and to make a report to the members on the statement; and the report shall be annexed to the statement before it is made available.

(9) A report under subsection (8) shall state whether in the opinion of the auditors the statement contains the particulars required under subsection (7) and, where their opinion is that it does not, they shall include in the report, so far as they are reasonably able to do so, a statement giving the required particulars.

Record and disclosure of certain business.

60. —(1) Where, at anytime during a financial year of a building society, a person both is an officer of a society and is, or is a director of or a partner in, a business associate of the society, this section shall apply as respects that year to the society in relation to the relevant service provided to the society by the business associate.

(2) A person is a “business associate” of a society in any financial year of the society if that person—

(a) carries on a business which consists of or includes the provision of relevant services,

(b) provides relevant services during that year to the society, and

(c) is not a subsidiary of the society.

(3) Subject to this section, a society shall maintain at its chief office a register containing the particulars required by subsection (4) in relation to every business associate of the society.

(4) The particulars referred to in subsection (3) are the aggregate amount of fees paid to the business associate by the society or on its behalf in respect of each of the relevant services in the last complete financial year and each of the 5 financial years preceding that year but excluding years prior to the year 1989.

(5) The following are “relevant services” for the purposes of this section—

(a) conveyancing services,

(b) surveying and valuing land or other property,

(c) arranging for the provision of insurance against loss of or damage to property or on human life,

(d) advertising or public relations services, and

(e) any other services as may be specified as relevant services by the Central Bank from time to time.

(6) Where a business associate of a society provides the society with services which are relevant services by virtue of subsection (5), any administrative services provided to the society by the business associate are also relevant services.

(7) No particulars of the business of a business associate of a society need be kept in the register provided for by subsection (3) as respects any financial year of the society in which the volume of the business of which the particulars referred to in subsection (3) are required did not exceed £5,000 or such other sum as may be specified from time to time by the Central Bank.

(8) A society shall make available for inspection by members at its chief office during the period of 15 days expiring on the date of its annual general meeting and at the annual general meeting, a statement containing the particulars required to be kept in the register as respects the last complete financial year preceding the meeting.

(9) Two copies of the statement required to be so made available to members shall be sent by the society to the Central Bank not later than the date on which the statement is required to be first made available to members and the Bank shall keep one of them in the public file of the society.

(10) A copy of the statement required to be so made available shall also be sent, on demand and on payment of such fee as may be specified by the Central Bank, to any member of the society.

Particulars of directors' salaries etc. to be given in accounts.

61. —Section 191 of the Act of 1963 shall, subject to any necessary modifications, apply as if the society were a company.

Prohibition of tax-free payments.

62. —(1) It shall not be lawful for a society to pay a director remuneration (whether as director or otherwise) free of income tax or otherwise calculated by reference to or varying with the amount of his income tax or to or with the rate of income tax.

(2) Any provision in a society's rules or in any contract or in any resolution of a society or a society's directors, for payment to a director of remuneration as in subsection (1) shall have effect as if it provided for payment, as a gross sum subject to income tax, of the net sum for which it actually provides.

(3) In this section “remuneration” includes emoluments within the meaning of section 191 of the Act of 1963.

Directors' names on business letters.

63. —(1) A society shall in all business letters on or in which the society's name appears and which are sent by the society to any person state in legible characters in relation to every director his present surname together with his present forename (or the initials of that forename) and any former names.

(2) If special circumstances exist which render it in the opinion of the Central Bank expedient that such an exemption should be granted, the Bank may, subject to such conditions as it may think fit, grant exemption from the obligations imposed by this section.

Disqualification of certain persons from acting as directors or auditors of or managing building societies.

64. —(1) A person who has been adjudicated bankrupt and whose bankruptcy still subsists or who has been convicted of an indictable offence in relation to a building society or involving fraud or dishonesty or against whom a disqualification order has been made shall not be qualified to be appointed or act as an officer, auditor, receiver, liquidator or to be in any way, whether directly or indirectly, concerned with or to take part in the promotion, formation, direction or management of a society.

(2) (a) Where the court is satisfied in any proceedings or as a result of an application under this section that—

(i) a person has been guilty, while a promoter, officer, auditor, receiver or liquidator of a society, of any fraud in relation to the society, its members or creditors; or

(ii) a person has been guilty, while a promoter, officer, auditor, receiver or liquidator of a society of any breach of his duty as such promoter, officer, auditor, receiver or liquidator; or

(iii) the conduct of any person as promoter, officer, auditor, receiver or liquidator of a society makes him unfit to be concerned in the management of a society; or

(iv) in consequence of a report of inspectors appointed by the Central Bank under this Act the conduct of any person makes him unfit to be concerned in the management of a society; or

(v) a person has been persistently in default in relation to the relevant requirements;

the court may, of its own motion, or as a result of the application, make a disqualification order against such a person for such period as it sees fit.

(b) In paragraph (a)the court” means the High Court except in relation to a disqualification order made by a court of its own motion under paragraph (a) (i), (ii), (iii), or (v) in which case it includes any court.

(3) (a) For the purposes of subsection (2) (a) (v) the fact that a person has been persistently in default in relation to the relevant requirements may (without prejudice to its proof in any other manner) be conclusively proved by showing that in the 5 years ending with the date of the application he had been adjudged guilty (whether or not on the same occasion) of 3 or more defaults in relation to those requirements.

(b) A person shall be adjudged guilty of a default in relation to a relevant requirement for the purposes of this subsection if he is convicted of any offence consisting of a contravention of a relevant requirement.

(4) In this section “disqualification order” means an order made under subsection (2) or section 184 of the Act of 1963.

(5) An application under subsection (2) may be made by the Director of Public Prosecutions or the Central Bank.

(6) An application under paragraph (a) (i), (ii) or (iii) of subsection (2) may be made by any member, officer, auditor, receiver, liquidator or creditor of any society in relation to which the person who is the subject of the application—

(a) has been or is acting or is proposing to or being proposed to act as officer, auditor, receiver or liquidator, or

(b) has been or is concerned or taking part, or is proposing to be concerned or take part, in the promotion, formation, direction or management of a society,

and where the application is made by a member or creditor of the society, the Court may require security for all or some of the costs of the application.

(7) Where it is intended to make an application under subsection (2) in respect of any person, the applicant shall give not less than 10 days' notice of his intention to that person.

(8) Any person who is disqualified by virtue of this section may apply to the Court for relief, either in whole or in part, from that disqualification and the Court may, if it deems it just and equitable to do so, grant such relief on whatever terms and conditions it sees fit.

(9) A disqualification order may be made on grounds which are or include matters other than criminal convictions notwithstanding that the person in respect of whom the order is to be made may be criminally liable in respect of those matters.

(10) Whenever a person holding an office in a society becomes ineligible by virtue of this section to hold office, he shall forthwith cease to hold that office and the vacancy shall be deemed to be a casual vacancy and may be filled in the manner provided for such a vacancy in the rules of the society.

(11) A person who is disqualified by virtue of subsection (1) from holding any position in relation to a society and permits his name to be put forward for election or appointment to that position shall be guilty of an offence.

(12) Any person who in relation to any society, acts in a manner or capacity which, by virtue of being disqualified under subsection (1), he is prohibited from doing shall be guilty of an offence.

(13) In this section “relevant requirement” means any provision of this Act which requires or required any return, account or other document to be given or sent to, or notice of any matter to be given to the Central Bank.

Register of members.

65. —(1) Every building society shall keep a register of the names and addresses of its members.

(2) The register shall be kept at the chief office of the society or, with the consent in writing of the Central Bank, at one or more offices of the society other than its chief office.

(3) Every society having more than 50 members shall, unless the register is in such a form as to constitute an index, keep an index of the names of the members of the society and shall, within 14 days after the date on which any alteration is made in the register of members, make any necessary alteration in the index, and the index shall at all times be kept at the same place as the register of members.

(4) (a) A member of a society may, for the purpose of communicating with other members on a subject relating to its affairs, request the board of directors of the society to transmit to those other members such information as he requests and where the board, having regard to the interests of members as a whole and to any other relevant circumstances, is satisfied that the request is made in good faith, it shall comply with the request.

(b) Where the society complies with a request under paragraph (a) the applicant shall be liable for any costs incurred by the society in complying with the request and the society may require the applicant to give security for payment of costs.

(5) In the event of the refusal of a society to comply with a request under subsection (4), it shall notify the member who made the request of the grounds for such refusal and the member may refer the refusal to the Central Bank.

(6) A decision on a request under subsection (4) shall be notified to the member who made the request within a period of one month after the day on which the request is received by the society.

(7) Where an applicant makes a reference to the Central Bank under subsection (5), the Bank may, as it thinks proper, having heard any representations made by the society, direct the society to comply with the request subject to such limitations or conditions (including conditions relating to the nature of the information to be given, and to arrangements for payment of costs) as the Bank may think fit.

(8) At any time when a society has had its authorisation revoked under section 40 any 10 members of the society shall have the right to obtain from the register kept under subsection (1) the names and addresses of members of the society for the purpose of communicating with them on a subject relating to the affairs of the society.

Register of directors, etc.

66. —(1) Every building society shall keep at its chief office or, with the consent in writing of the Central Bank, at one or more of the offices of the society other than its chief office a register containing the following particulars relating to each director, the chief executive and the secretary of the society—

(a) his present surname and forenames and any former names and, in the case of a person known by a title different from his “surname”, that title;

(b) his usual residential address;

(c) his place and date of birth;

(d) his nationality;

(e) in the case of a director, his business occupation (if any); and

(f) particulars of any other directorships of bodies corporate, whether incorporated in the State or elsewhere, held by him or which have been held by him within the preceding 5 years.

(2) (a) A society shall within the appropriate period referred to in paragraph (b), send to the Central Bank a return in such form as it may require of the particulars contained in a register under this section and a notification of any change in the register, together with the date of such change.

(b) The periods mentioned in paragraph (a) are—

(i) in the case of the return, 14 days from the commencement of this section where a society is incorporated before such commencement, and 14 days from the date of appointment of the first directors where a society is incorporated after such commencement; and

(ii) in the case of a change, 14 days from the change.

(3) Any member of a society or any other person may require a copy of the register, or of any part thereof on payment of such fee as the Central Bank may fix, and the society shall cause any copy so required to be sent to the person within a period of 10 days after the day on which the request for the copy is received by the society.

(4) A register under this section shall be open to inspection by any member free of charge, and by any other person on payment of such fee as the Central Bank may fix, subject to such reasonable restrictions as the society concerned may impose at a general meeting, but so that not less than 2 hours in each business day be allowed for inspection.

PART VI

Meetings, Resolutions, Voting, etc.

Annual general meeting.

67. —(1) Subject to subsections (2) and (3), a building society shall hold a meeting in the State, in the first 4 months of each financial year, as its annual general meeting (in addition to any other meetings in that year), and shall specify the meeting as such in the notices calling it.

(2) A society need not hold an annual general meeting in the year in which it is incorporated.

(3) The Central Bank may at its discretion, upon application being made to it in writing by a society, fix a longer period than 4 months for the purposes of subsection (1).

(4) Where default is made in complying with subsection (1), the Central Bank may call or direct the calling of an annual general meeting and give such ancillary or consequential directions as it thinks expedient, including directions modifying or supplementing the operation of the rules of the society in relation to the calling, holding and conduct of the meeting.

(5) Notwithstanding anything in the rules of a society, the business which may be dealt with at the annual general meeting may include any resolution (including as special resolution or a conversion resolution).

Notice of meetings.

68. —(1) Any provision in the rules of a building society shall be void to the extent that it provides for the calling of a meeting of the society (other than an adjourned meeting) by less than 21 or more than 42 days' notice expiring with the date of the meeting or, if earlier, the date specified by the society, under its rules, as the final date for the receipt of instruments appointing proxies to vote at the meeting.

(2) A meeting of a society called by a shorter notice than 21 days' notice shall be deemed to have been properly called if it is so agreed by the Central Bank on application being made to it in writing by the society.

(3) A society shall give notice of a meeting of the society—

(a) by sending to every person entitled to notice of the meeting a notice in such form as the Central Bank may direct, or

(b) with the consent of the Central Bank given where the Bank considers it proper in the circumstances, by publishing in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated a notice in such form as the Bank may direct.

(4) Where notice of a meeting is given in accordance with subsection (3) (b), any other requirement under this Act to send to members with the notice of or in connection with a meeting a proxy instrument, notice or other document shall be satisfied as respects it if either—

(a) it is published along with the notice, or

(b) the notice under subsection (3) (b) states that it may be obtained at all offices of the society during normal office hours,

as the Central Bank may direct.

(5) Notice of a meeting of a society shall be given to every member of the society eligible to vote on the date of the notice and to the Central Bank.

(6) Neither accidental omission to give notice of a meeting of a society to a person entitled to receive notice of the meeting nor the non-receipt by such a person of a notice of such a meeting shall invalidate the proceedings at that meeting.

Members' entitlement to vote on resolutions.

69. —(1) Subject to section 16 and this section, the persons entitled to vote on a resolution of a building society are—

(a) on a resolution, other than a conversion resolution, all the members who at the end of the last financial year of the society before the date of the meeting or the postal ballot, as the case may be, had held continuously shares to the value of not less than £100 for the preceding period of 6 months and continue to hold such shares on the voting date; and

(b) on a conversion resolution, all members within the meaning of paragraph (a) and all other persons who were borrowing members within the meaning of section 71 (2) at the end of the last financial year and continue to be so on the voting date.

(2) Subject to subsection (3), any provision in the rules of a society is void to the extent that it would have the effect of restricting the rights conferred by subsection (1) but nothing in this section implies that a society cannot in its rules grant voting rights to members of any description.

(3) On a vote on a resolution, which under this Act will not be effective unless it is passed as a special resolution or a conversion resolution, each member entitled to vote shall have one vote.

(4) In this section “voting date”, with reference to any resolution, means—

(a) the date of the meeting at which the resolution is moved, except where paragraph (b) applies; and

(b) where voting on the resolution is to be conducted by postal ballot, the date which the society specifies as the final date for the receipt of completed ballot papers.

Special resolution.

70. —(1) No resolution of a building society shall be passed as a special resolution unless it is required to be so passed by or under this Act or by the rules of the society.

(2) A resolution of a society shall be a special resolution when it has been passed by a majority of such members of the society as, being entitled to do so—

(a) vote in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a special resolution has been duly given; or

(b) vote in a postal ballot on the resolution of which notice specifying that the resolution will not be effective unless it is passed as a special resolution has been duly given.

(3) The terms of any special resolution before a general meeting of a society may be amended by ordinary resolution moved at the meeting if the chairman of the meeting is satisfied that the terms of the resolution as amended will still be such that adequate notice of the intention to move the resolution can be deemed to have been given.

Conversion resolutions.

71. —(1) A resolution of a society shall be a conversion resolution when it has been passed by a majority of such members of the society as, being entitled to do so—

(a) vote in person or by proxy on a poll on the resolution at a meeting of the society of which notice specifying the intention to move the resolution as a conversion resolution has been duly given; or

(b) vote in a postal ballot on the resolution of which notice specifying that the resolution will not be effective unless it is passed as a conversion resolution has been duly given.

(2) For the purposes of this section and Part XI a person is a borrowing member of a society at any time if at that time his indebtedness to the society is in respect of—

(a) a loan, made under the repealed enactments, secured by the mortgage of freehold or leasehold estate or interest in a house, or

(b) a housing loan,

and if, in either case, the amount of his mortgage debt is not less than £500 or such other amount as the Central Bank may, from time to time, prescribe by regulation.

Proxies.

72. —(1) A member of a building society who is entitled to attend and vote at a meeting of the society may appoint another person (whether a member of the society or not) as his proxy to attend, speak and, subject to subsection (2), to vote at the meeting instead of him, and may direct the proxy how to vote at the meeting.

(2) A proxy is entitled to vote on a poll but, subject to any provision in the rules of the society, not otherwise.

(3) In every notice calling a meeting of a society there shall appear with reasonable prominence a statement—

(a) that a member entitled to attend and vote may appoint a proxy to attend, speak and vote instead of him;

(b) that the proxy need not be a member of the society; and

(c) that the member may direct the proxy how to vote at the meeting.

(4) Every notice calling a meeting of a society shall have annexed to it one instrument for appointing a proxy for completion by the member if he wishes to appoint a proxy.

(5) Any provision in the rules of a society shall be void to the extent that it would have the effect of requiring the instrument appointing a proxy or any other document necessary to show the validity of, or otherwise relating to the appointment of a proxy to be received by the society or any other person more than 10 days before a meeting or adjourned meeting in order that the appointment may be effective at the meeting or adjourned meeting.

(6) The instrument appointing a proxy shall be in such form as the Central Bank may direct and the Bank may specify as respects a proxy instrument—

(a) matters to be included in or excluded from the instrument, and

(b) the declarations to be made in the instrument by the member appointing a proxy.

(7) Except at the written request of a member, no instrument for the appointment of a proxy shall be issued by a society or at the society's expense apart from the instruments issued under subsection (4).

(8) A society shall keep in a safe place for a period of one year from the date of their receipt all instruments appointing proxies and requests from members under subsection (7).

Right to demand a poll.

73. —(1) Any provision in the rules of a building society shall be void in so far as it would have the effect either—

(a) of excluding the right to demand a poll at a meeting of the society on any question other than the election of the chairman of the meeting or the adjournment of the meeting, or

(b) of making ineffective a demand for a poll on any such question which is made by not less than 10 members having the right to vote at the meeting.

(2) The instrument appointing a proxy to vote at a meeting of a society shall be deemed also to confer authority to demand or join in demanding a poll, and, for the purposes of subsection (1), a demand by a person as a proxy for a member or members shall be the same as a demand by the member or members.

Members' right to propose and circulate resolutions.

74. —(1) If 25 members, or such lesser number as may be specified in the rules of a building society, who are entitled to vote on a resolution, give notice in writing to the society of their intention to move, or to cause to be moved on their behalf, at an annual general meeting, a resolution (the text of which is included in the notice), other than a conversion resolution, it shall be the duty of the society, subject to subsections (2), (3) and (9)

(a) to include in the notice of the annual general meeting a notice specifying the intention to move the resolution, or to cause it to be moved on their behalf, at the meeting and, where applicable, the intention to move it as a special resolution; and

(b) at the request of the members intending to move the resolution, or to cause it to be moved on their behalf, to send to each member entitled to receive notice of the meeting a copy of a statement of not more than 300 words with respect to the matter referred to in the resolution.

(2) Subsection (1) does not require a society to send notices of a resolution or copies of a statement to members of the society in any case where—

(a) the contents of the resolution or, as the case may be, the statement would be likely to diminish substantially public confidence in the society;

(b) the rights conferred by subsection (1) are being abused to seek needless publicity for defamatory matter or for frivolous or vexatious purposes; or

(c) if the resolution were passed, the society would be involved in activities likely to be ultra vires;

and that subsection shall not be taken to confer any rights on members, or to impose any duties on a society, in respect of a resolution or statement which does not relate directly to the affairs of the society.

(3) If the rules of a society so provide, subsection (1) does not require notice of a resolution to be given to members of the society if the resolution is in substantially the same terms as any resolution which has been defeated at a meeting or on a postal ballot during the period beginning with the third annual general meeting before the date on which notice of the resolution is given to the society.

(4) Where the society refuses, or proposes to refuse to give notice of a resolution or to send to members a statement submitted under subsection (1), it shall within 14 days after the receipt of the resolution notify the members who submitted it of such refusal and the grounds for the refusal and the said members may within 7 days of the refusal refer the refusal to the Central Bank who may direct the society to circulate the resolution or the statement subject to such conditions as the Bank may require.

(5) No copies of a statement with respect to a resolution shall be sent to members of a society if, on any of the grounds in subsection (2) or (3), the society does not give the notice of the resolution to them required by subsection (1) (a).

(6) Notice of a resolution given under subsection (1) must be given to the society not later than the last day of the financial year of the society preceding the financial year in which is held the annual general meeting at which it is intended to move the resolution and any statement to be sent to members under subsection (1) (b) must also be sent to the society not later than that day.

(7) The notice of a resolution and the copies of a statement required to be sent to members by subsection (1) (a) or (b) shall be sent to them in the same manner and (so far as practicable) at the same time as the notice of the annual general meeting at which the resolution is intended to be moved, and, where it is not practicable for them to be sent at the same time as the notice, they shall be sent as soon as practicable thereafter.

(8) Where notices of a resolution, or copies of a statement in respect of a resolution intended to be moved at a meeting are required to be sent to any persons, the proceedings at the meeting are not invalidated by—

(a) the accidental omission to send a notice or copy to a person entitled to receive one, or

(b) the non-receipt of a notice or copy by such a person.

(9) This section shall not apply to a special resolution where, in the case of a society which, under the repealed enactments, was entitled to issue shares to which voting rights did not attach—

(a) 75 per cent. of the holders of that class of shares, issued before 15 August, 1984, to which voting rights then attached consider that the resolution would, if passed, be unreasonable having regard to their interests;

(b) the shareholders referred to in paragraph (a), in accordance with the rules of the society, refer the question for arbitration and, for this purpose, the rules shall be deemed to be an arbitration agreement within the meaning of the Arbitration Acts, 1954 and 1980; and

(c) the arbitrator finds that the resolution would, if passed, be unreasonable having regard to the interests of the shareholders referred to in paragraph (a).

Postal ballots.

75. —(1) The rules of a building society may provide for the voting in an election of directors or on any resolution of the society to be conducted in all or in any particular circumstances by postal ballot; and in this Act “postal ballot”, in relation to an election, or a resolution of the society, means the postal ballot, if any taking place by virtue of those rules in the case of the election or the resolution in question.

(2) Where, under the rules of a society, a postal ballot is to take place, the following provisions of this section have effect.

(3) Notice of a postal ballot shall be given not less than 21 nor more than 42 days before the date which the society specifies as the final date for the receipt of completed ballot papers (referred to in this section as the “voting date”).

(4) Subject to the provisions of this Part, notice of a postal ballot shall be given to every member of the society who would be entitled to vote in the election or on the resolution if the voting date for the election or the resolution fell on the date of the notice.

(5) Notice of a postal ballot shall contain a ballot paper and such other notices relating to the election or resolution, and shall be accompanied by such other documents, as would be required to be given or sent to a member in connection with notice of a meeting, had it been intended to hold the election or vote on the resolution at a meeting instead of by postal ballot with the exception, however, of any notice relating to voting by proxy at a meeting.

(6) Accidental omission to give notice of a postal ballot, or to send any document required by subsection (5) to accompany such a notice, to a person entitled to receive it, or non-receipt of such a notice or document by that person, does not invalidate the postal ballot.

PART VII

Accounts and Audit

Accounting records, systems of business control and keeping of title deeds.

76. —(1) A building society shall—

(a) cause proper accounting records to be kept on a continuous and consistent basis, and

(b) establish and maintain systems of control of its business and records and systems of inspection and report thereon,

in accordance with this section.

(2) The accounting records of a society shall be such as to—

(a) correctly record and explain the transactions of the society;

(b) disclose, with reasonable accuracy and promptness, the financial position of the society at any time;

(c) enable the directors properly to discharge the duties imposed on them by or under this Act and their functions of direction of the affairs of the society;

(d) enable the society properly to discharge the duties imposed on it by or under this Act; and

(e) enable the accounts of the society to be readily and properly audited.

(3) Without prejudice to the generality of subsection (1) or (2), accounting records kept pursuant to this section shall contain—

(a) entries from day to day of all sums of money received and expended by the society and the matters in respect of which the receipt and expenditure take place;

(b) a record of the assets and liabilities of the society and entries from day to day of every transaction entered into by the society which will or may give rise to liabilities or assets of the society; and

(c) in respect of the provision of services, a record of the services provided and of all the invoices relating thereto.

(4) For the purposes of subsection (1) proper accounting records shall be deemed to be kept if they comply with subsections (2) and (3), and give a true and fair view of the state of affairs of the society and explain its transactions.

(5) The systems of control which are to be established and maintained by a society pursuant to subsection (1) are systems for the control of the conduct of its business as required by or under this Act and in accordance with the decisions of the board of directors and for the control of the accounting and other records of its business and no such systems shall be treated as established or maintained unless there is kept available to the board a detailed statement in writing of the systems as in operation for the time being.

(6) The systems of inspection and report which are to be established and maintained by a society pursuant to subsection (1) are systems of inspection on behalf of, and report to, the board of directors on the operation of the systems of control of the society's business and records as required by subsection (5).

(7) Without prejudice to the generality of subsection (1), the systems of control and of inspection and report must be such as to secure that the society's business is so conducted and its records so kept that—

(a) the information necessary to enable the directors and the society to discharge their duties and functions is sufficiently accurate, and is available with sufficient regularity or at need and with sufficient promptness for these purposes; and

(b) the information obtained by or furnished to the Central Bank is sufficiently accurate for the purposes for which it is obtained and is available as required by the Bank.

(8) The accounting records of a society shall be kept at the chief office of the society or at such other place as the directors think fit and shall at all reasonable times be open to inspection by the directors.

(9) Every record required to be kept under this section shall be preserved by the society for a period of not less than 6 years after the latest date to which it relates.

(10) Where a society has subsidiaries, the society shall also secure that such accounting records are kept and such systems of control and of inspection and report are established and maintained by the society and the subsidiaries as will enable the society to comply with the requirements of this section in relation to the business of the society and those subsidiaries.

(11) Every society shall establish and maintain a system to ensure the safe custody of all documents of title belonging to the society and of deeds relating to property mortgaged to the society.

(12) (a) A society which contravenes this section or a director of a society or a chief executive who fails to take all reasonable steps to secure compliance by the society with this section or has, in the case of a director or chief executive, by his own wilful act been the cause of any default by the society thereunder, shall, in respect of each such failure or act, be guilty of an offence.

(b) In any proceedings under this subsection against a person for an offence of failing to take all reasonable steps to comply with this section it shall be a defence to prove that he had reasonable grounds for believing and did believe that a competent and reliable person was charged with the duty of ensuring such compliance and was in a position to discharge that duty.

Annual accounts.

77. —(1) The directors of a building society shall prepare in respect of each financial year of the society—

(a) an income and expenditure account giving a true and fair view of its income and expenditure for that year,

(b) a balance sheet giving a true and fair view of the state of its affairs as at the end of that year, and

(c) a statement of the source and application of funds giving a true and fair view of the manner in which its business has been financed and in which its financial resources have been used during that year,

and each of these shall be in such form and shall contain such particulars as the Central Bank may direct.

(2) Subject to subsection (5), if, at the end of its financial year, a society has subsidiaries, the directors shall also prepare, with respect to that year, group accounts dealing respectively with the income and expenditure, the state of the affairs and the source and application of the funds, of the society and the subsidiaries.

(3) The directors of a society which has subsidiaries shall secure that, in so far as it is practicable, the financial year of each of its subsidiaries coincides with the society's own financial year.

(4) Where the directors prepare a statement of the source and application of funds of the society and its subsidiaries under subsection (2), they need not also prepare such a statement as to the society's funds under subsection (1).

(5) The Central Bank may, as it thinks proper, on application by a society—

(a) grant a dispensation from the requirement—

(i) to prepare group accounts,

(ii) to deal with all subsidiaries in group accounts, and

(b) permit group accounts to be prepared in other than consolidated form.

(6) Unless the Central Bank otherwise allows, the income and expenditure account, the balance sheet and the statement of the source and application of funds of a society for any financial year shall, where applicable, include corresponding particulars for the preceding financial year.

(7) The annual accounts shall also contain, whether in the form of notes or otherwise, such supplementary information as is required by or under this Act.

(8) The Central Bank may, by regulations, make further provision with respect to the annual accounts of a society and, without prejudice to the generality of this subsection, the regulations may—

(a) add to the documents to be comprised in a society's accounts to be prepared for each financial year under subsection (1) or (2),

(b) make provision as to the matters to be included in any document comprised in a society's accounts,

(c) prescribe accounting principles and rules for the preparation of annual accounts, and

(d) require the annual accounts of societies to deal also with bodies associated with them to a prescribed extent.

(9) (a) Where a director or a chief executive of a society fails to take all reasonable steps to secure compliance with this section he shall be guilty of an offence.

(b) In any proceedings against a person in respect of an offence under this section, it shall be a defence to prove that he had reasonable grounds for believing and did believe that a competent and reliable person was charged with the duty of seeing that this section was complied with and was in a position to discharge that duty.

(10) The accounts prepared with respect to a society's financial year under this section, whether as individual accounts or group accounts, together with the notes to them, are referred to in this Act as “the annual accounts”.

Directors' report.

78. —(1) The directors of a building society shall prepare in respect of each financial year of the society a report on the society's business containing—

(a) a fair review of the development of its business during the financial year and of its position at the end of it, and

(b) such information relating to such aspects of the business, including its future development, of the society and any subsidiaries or other bodies associated with it as the Central Bank may specify.

(2) The directors' report shall be signed by 2 directors (other than the chief executive) on behalf of the board of directors of the society.

(3) Where the society has subsidiaries or other associated bodies the report shall, in addition to containing any information required in relation to them under subsection (1) (b), review the development of the business of the society and its subsidiaries and other associated bodies during the financial year and their position at the end of it.

(4) (a) Where a director of the society fails to take all reasonable steps to comply with the requirements of this section he shall be guilty of an offence.

(b) In any proceedings against a person in respect of an offence under this section, it shall be a defence to prove that he had reasonable grounds for believing and did believe that a competent and reliable person was charged with the duty of seeing that this section was complied with and was in a position to discharge that duty.

Summary financial statement.

79. —(1) The directors of a building society shall prepare in respect of each financial year a summary financial statement for that year derived from the annual accounts and the directors' report giving a fair and accurate summary account of the society's financial development during that year and financial position at the end of the year.

(2) The summary financial statement shall be signed by 2 directors (other than the chief executive) on behalf of the board of directors and by the chief executive of the society.

(3) Where the society has subsidiaries or other associated bodies the statement shall (so far as they are dealt with in the group accounts) give an account of the financial development and position of the society and its subsidiaries and other associated bodies.

(4) The Central Bank may specify the form and content of the summary financial statement.

(5) Every summary financial statement shall include a statement of the auditors' opinion as to its consistency with the annual accounts of the society and the directors' report and its conformity with the requirements of this section and the Central Bank.

(6) A copy of the summary financial statement and, where it includes a qualification, a copy of the auditors' report under section 88 shall, not later than 21 days before the date of the annual general meeting at which the annual accounts and directors' report are to be considered be sent by the society to every member who is entitled to notice of the meeting and to the Central Bank, which shall keep a copy of the statement in the public file of the society.

(7) Every summary financial statement shall also include statements to the effect that—

(a) it is only a summary of information in the annual accounts and directors' report,

(b) in so far as it summarises the information in the annual accounts, those accounts have been audited, and

(c) copies of the annual accounts, auditors' report and directors' report will be available to members and depositors at every office of the society after a specified date on payment of such fee, if any, as the Central Bank may fix.

Display of statement.

80. —A building society shall display and at all times keep displayed in a conspicuous place in every office, branch or other place of business of the society a statement, in such form as the Central Bank may direct, in relation to the business carried on by the society.

Signing of balance sheet.

81. —(1) Every balance sheet of a building society shall be signed on behalf of the board of directors by 2 of the directors (other than the chief executive) and by the chief executive of the society.

(2) There shall be annexed to every balance sheet of a society the income and expenditure account, the statement of the source and application of funds and the group accounts, if any, and the auditors' report and the directors' report shall be attached thereto, and any account and statement so annexed shall be approved by the board of directors before the balance sheet is signed on their behalf and the date of their approval of these documents shall be endorsed on the balance sheet.

(3) A society which, and any person who, issues, circulates or publishes a balance sheet that has not been signed as required by subsection (1) or does not have annexed to it or attached to it the documents required by subsection (2) shall be guilty of an offence and so shall every person who was a director at the time of default.

Documents to be laid before annual general meeting.

82. —(1) The directors of a society shall lay before the society at the annual general meeting the annual accounts in respect of the last financial year.

(2) The directors of a society shall send a copy of the annual accounts for the last financial year to the Central Bank not later than 21 days before the date of the annual general meeting and the Bank shall keep a copy of those documents in the public file of the society.

(3) Every society shall, as from the date by which at the latest its directors are required to send them to the Central Bank, make copies of the annual accounts available to members of and depositors with the society at every office of the society during office hours and shall send copies of those documents within 7 days to any member or depositor who demands them on payment of such fee as may be fixed by the Bank.

(4) The Central Bank may, if it thinks fit, require a society to send free of charge within a specified time a copy of any document referred to in this section to every member of the society.

(5) In this section any reference to the annual accounts includes a reference to the documents annexed or attached to them under section 81 .

(6) If default is made in complying with subsection (1), (2) or (3) every person who was a director at the time of the default shall be guilty of an offence.

Appointment and removal of auditors.

83. —(1) A building society shall, at each annual general meeting, appoint an auditor or auditors to hold office from the conclusion of that meeting until the conclusion of the next annual general meeting.

(2) Notwithstanding any agreement between the society and an auditor, and without prejudice to any rights of the auditor in relation to his removal under this Act, a society may by resolution at a general meeting remove an auditor before his term of office expires and may appoint in his place any other person who has been duly nominated for appointment, who is qualified under this Act to be an auditor of a society and of whose nomination due notice has been given to its members and the Central Bank.

(3) The first auditors of a society may be appointed by the directors at any time before the first annual general meeting.

(4) Where the directors fail to exercise their powers under subsection (3), these powers may be exercised by the society in general meeting and thereupon the said powers of the directors shall cease.

(5) Where, at an annual general meeting, no auditor is appointed, the Central Bank may appoint a person to fill the vacancy and the remuneration and expenses of auditors so appointed may be fixed by the Bank.

(6) A society shall—

(a) within one week of the Central Bank's power under subsection (5) becoming exercisable, give the Bank notice of that fact, and

(b) where a resolution removing an auditor is passed, give notice of that fact to the Central Bank in such form as may be required by the Bank within 14 days of the meeting at which the resolution removing the auditor was passed.

(7) The directors of a society or the society in general meeting may fill any casual vacancy in the office of auditor but, while any such vacancy continues, the surviving or continuing auditor or auditors, if any, may act.

(8) The appointment of a firm by the name of the firm to be the auditor of a society shall be deemed to be an appointment of those persons who from time to time during the period of the appointment are the partners in that firm as from time to time constituted and are qualified to be auditors of the society.

(9) Where the Central Bank is of the opinion that it would not be in the interests of a society or in the interest of shareholders in or depositors with the society, it may direct, as the circumstances require, the society not to appoint or re-appoint to the office of auditor, or the directors not to fill a casual vacancy in that office with, a named person and the direction shall be complied with.

(10) An auditor of a society who decides not to make himself available for re-appointment to the office of auditor shall serve notice of his decision on the society at least 35 days before the annual general meeting at which his term of office is to expire.

(11) Where notice is given by an auditor under subsection (10) the provisions of subsections (2) to (5) of section 85 shall apply with necessary modifications.

Resolutions relating to appointment and removal of auditors.

84. —(1) Subject to subsection (2), a resolution at a general meeting of a building society—

(a) appointing as auditor a person other than a retiring auditor,

(b) providing that a retiring auditor shall not be reappointed,

(c) removing an auditor before the expiration of his term of office,

(d) filling a casual vacancy in the office of auditor, or

(e) re-appointing as auditor a retiring auditor who was appointed by the directors to fill a casual vacancy,

shall not be effective unless notice of the intention to move it has been given to the society and to the Central Bank not less than 28 days before the meeting at which it is to be moved.

(2) Where, after notice of the intention to move such a resolution has been given to the society, a general meeting of the society is called for a date less than 28 days after the notice has been given, the notice, although not given within the time required by subsection (1) shall be deemed to have been properly given for the purpose of that subsection.

(3) A society shall give its members notice of any such intended resolution at the same time and in the same manner as it gives notice of the meeting or, if that is not practicable, it shall give them notice, the period of which has been approved by the Central Bank, of the intended resolution by advertisement in a daily newspaper published in the State and circulating in the area in which the society's chief office is situated.

(4) A notice under subsection (3) shall not be given within 7 days of the date of the receipt of the intended resolution.

(5) On receipt of notice of such an intended resolution as is mentioned in subsection (1), the society shall forthwith—

(a) if the resolution is a resolution mentioned in paragraph (a) or (b) of the subsection, send a copy thereof to the retiring auditor;

(b) if the resolution is a resolution mentioned in paragraph (c) of the subsection, send a copy thereof to the auditor proposed to be removed;

(c) if the resolution is resolution mentioned in paragraph (d) of the subsection, send a copy thereof to the person (if any) whose ceasing to hold the office of auditor of the society occasioned the casual vacancy;

(d) if the resolution is a resolution mentioned in paragraph (e) of the subsection, send a copy thereof to the person so ceasing to hold office.

(6) Where notice is given of such an intended resolution as is mentioned in paragraphs (a), (b) and (c) of subsection (1) and the retiring auditor or the auditor proposed to be removed, as the case may be, makes in relation to it representations in writing to the society (not exceeding a reasonable length) and requests their notification to the members of the society, the society shall, subject to subsection (7), (unless the representations are received by it too late for it to do so)—

(a) in any notice of the intended resolution given to members of the society, state the fact of the representations having been made, and

(b) send a copy of the representations to every member to whom notice of the meeting is or has been sent,

and if a copy of the representations is not sent as aforesaid because it was received too late or because of the society's default, the auditor may (without prejudice to his right to be heard orally) require that his representations shall be read out at the meeting.

(7) Subsection (6) shall not apply if, on the application either of the society or of any other person who claims to be aggrieved, the Central Bank is satisfied that compliance with it would diminish substantially public confidence in the society or that the rights conferred by it are being, or are likely to be, abused in order to secure needless publicity for defamatory matter.

(8) An auditor of a society who has been removed shall be entitled to attend—

(a) the annual general meeting of the society at which, but for his removal, his term of office as auditor of the society would have expired, and

(b) the general meeting of the society at which it is proposed to fill the vacancy occasioned by his removal, and

to receive all notices of, and other communications relating to, any such meeting which a member of the society entitled to notice of the meeting is entitled to receive, and to be heard at any such meeting on any part of the business of the meeting which concerns him as former auditor of the society.

Resignation of auditors.

85. —(1) An auditor of a building society may by a notice in writing, that complies with subsection (3), served on the society and stating his intention to do so, resign from the office of auditor to the society, and the resignation shall take effect on the date on which the notice is so served or on such later date as may be specified in the notice.

(2) A copy of a notice under subsection (1) shall be sent by the auditor to the Central Bank at the same time as it is served on the society.

(3) A notice under subsection (1) shall contain either—

(a) a statement to the effect that there are no circumstances connected with the resignation to which it relates that the auditor concerned considers should be brought to the notice of the members of, depositors with or creditors of the society, or

(b) a statement of any such circumstances.

(4) Subject to subsection (5), where a notice under subsection (1) is served on a society, the society shall, not later than 14 days after the date of such service, and if the notice contains a statement referred to in subsection (3) (b), send a copy of the notice to every person who is entitled to notice of a general meeting of the society.

(5) Copies of a notice served on a society under subsection (1) need not be sent to the persons specified in subsection (4) if, on the application of the society concerned or any other person who claims to be aggrieved, the Central Bank is satisfied that the sending of the notice would be likely to diminish substantially public confidence in the society or that the rights conferred by this section are being abused to secure needless publicity for defamatory matter.

Requisitioning of general meeting of society by resigning auditor.

86. —(1) A notice served on a building society under section 85 by a resigning auditor, which contains a statement in accordance with subsection (3) (b) of that section, may also requisition the convening by the directors of the society of a general meeting of the society for the purpose of receiving and considering such account and explanation of the circumstances connected with his resignation from the office of auditor to the society as the auditor may wish to give to the meeting.

(2) Where an auditor makes a requisition under subsection (1) the directors of the society shall, within 14 days of the service on the society of the said notice, proceed duly to convene a general meeting of the society for a day not more than 28 days after such service.

(3) Subject to subsection (4), where—

(a) a notice served on a society under section 85 contains a statement in accordance with subsection (3) (b) of that section, and

(b) the auditor concerned requests the society to circulate to its members—

(i) before the general meeting at which, apart from the notice, his term of office would expire, or

(ii) before any general meeting at which it is proposed to fill the vacancy caused by his resignation or convened pursuant to a requisition under subsection (1),

a further statement in writing prepared by the auditor of the circumstances connected with the resignation that the auditor considers should be brought to the notice of members,

the society shall in any notice of the meeting given to members of the society state the fact of the statement having been made, and send a copy of the statement to every person who is entitled to notice of a general meeting of the society.

(4) Subsection (2) need not be complied with by the society concerned if, on the application either of the society or any other person who claims to be aggrieved, the Central Bank is satisfied that the sending of the statement would be likely to diminish substantially public confidence in the society or that the rights conferred by this section are being abused to secure needless publicity for defamatory matter.

(5) An auditor of a society who has resigned from the office of auditor shall be permitted by the society to attend any such meeting as is mentioned in subsection (3) (b) and the society shall send him all notices of, and other communications relating to, any such meeting that a member of the society entitled to notice of the meeting is entitled to receive and to be heard at any such meeting which he attends on any part of the business of the meeting which concerns him as a former auditor of the society.

Qualifications for appointment as auditor.

87. —(1) A person shall not be qualified for appointment as auditor of a building society unless he is a member of a body of accountants membership of which is recognised by the Minister for Industry and Commerce under the Companies Acts as qualifying a person to be an auditor of a company, or is otherwise for the time being authorised by the said Minister under the said Acts to be appointed auditor of a company.

(2) None of the following persons shall be qualified for appointment as an auditor of a society—

(a) an officer or employee of the society,

(b) a person who is a partner of, or in the employment of, or who employs, an officer or employee of the society,

(c) a body corporate,

(d) a person who has been an officer or employee of the society within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the society,

(e) a parent, spouse, brother, sister or child of an officer of the society, or

(f) a person who is disqualified under the Companies Acts for appointment as an auditor of a subsidiary or other associated body of the society.

(3) A person shall not act as auditor of a society at a time when he is disqualified under this Act or under the Companies Acts for appointment to that office and, if an auditor of a society becomes so disqualified during his term of office as such auditor, he shall thereupon vacate his office and give notice in writing to the society concerned and to the Central Bank that he has vacated his office by reason of such disqualification.

Auditors' report, right of access to books and to attend general meeting.

88. —(1) The auditors of a building society shall make a report to the members on the accounts examined by them, and on the annual accounts and the directors' report which are to be laid before the society at the annual general meeting during their tenure of office.

(2) The auditors' report shall be read at the annual general meeting of the society and shall be open to inspection by any member of the society.

(3) The auditors' report shall state whether—

(a) they have obtained all the information and explanations which, to the best of their knowledge and belief, were necessary for the purposes of their audit;

(b) they are of the opinion that proper accounting records have been kept by the society;

(c) they are of the opinion that proper returns adequate for their audit have been received from branches and agents of the society not visited by them;

(d) the society's annual accounts are in agreement with the accounting records and the said returns;

(e) they are of the opinion that the society's annual accounts have been properly prepared so as to conform to the requirements of or under this Act and give a true and fair view—

(i) in the case of the balance sheet, of the state of the society's affairs as at the end of its financial year;

(ii) in the case of the income and expenditure account, of the income and expenditure of the society for its financial year; and

(iii) in the case of the statement of source and application of funds, of the manner in which the society has been financed and financial resources used during its financial year; and

(f) they are of the opinion that the information given in the directors' report is consistent with the accounting records and the annual accounts for the year.

(4) It shall be the duty of the auditors in preparing their report under this section to carry out such investigations as will enable them to form an opinion as to whether—

(a) the society has kept proper accounting records, and

(b) the society has maintained satisfactory systems of control of its business and records, and systems of inspection and report thereon, and

where the auditors are of opinion that the society has failed to keep proper accounting records or to maintain a satisfactory system of control of its business or records they shall so state in their report.

(5) Every auditor of a society shall have a right of access at all reasonable times to the books, accounts, records and vouchers of the society and to all other documents relating to its affairs (including deeds relating to property mortgaged to the society), and shall be entitled to require from the officers and employees of the society such information and explanations that are within their knowledge or can be procured by them as he thinks necessary for the performance of the duties of the auditors.

(6) The auditors of a society shall be entitled to attend any general meeting of the society, to receive all notices of, and other communications relating to, any such meeting that a member entitled to notice of the meeting is entitled to receive and to be heard at any meeting which they attend on any part of the business of the meeting which concerns them as auditors.

(7) Subsection (3) (e), in its application to the group accounts of a society, shall be read as referring to the society and (so far as it concerns the members of the society) the subsidiaries dealt with in the group accounts.

(8) Where a society has a subsidiary or other associated body, then—

(a) if the subsidiary or associated body is a body incorporated in the State, it is the duty of the subsidiary or other associated body and its auditors to give to the society's auditors such information and explanation and such access to documents as these auditors may reasonably require for the purpose of their duties as auditors of the society; and

(b) in any other case, it is the duty of the society, if required by its auditors to do so, to take all such steps as are reasonably open to it to obtain from the subsidiary or other associated body such information and explanation and such access as are mentioned in paragraph (a).

Duties of auditor.

89. —(1) If at any time an auditor of a building society—

(a) has reason to believe that there exist circumstances which are likely to affect materially the society's ability to fulfil its obligations to shareholders or depositors or meet any of its obligations under this Act,

(b) has reason to believe that there are material defects in the accounting records, systems of control of the business and records or of inspection and report thereon,

(c) has reason to believe that there are material inaccuracies in or omissions from any returns made by the society to the Central Bank,

(d) proposes to qualify any report which he is to provide under this Act, or

(e) has reason to believe that there are material defects in the system for ensuring the safe custody of all documents of title belonging to the society and deeds relating to property mortgaged to the society,

he shall forthwith report the matter to the Central Bank in writing.

(2) An auditor of a society shall, if requested by the Central Bank, furnish to the Bank a report stating whether in his opinion and to the best of his knowledge the society has or has not complied with such requirements under this Act as the Bank so requested the auditor to furnish a report on.

(3) An auditor of a society shall send to it a copy of any report made by him to the Central Bank under subsection (1) or (2).

(4) (a) Whenever the Central Bank is of the opinion that the exercise of its functions under this Act or the protection of the interests of shareholders or depositors so requires, it may require the auditors of a society to supply the Bank with such information as it may specify in relation to the audit of the business of the society.

(b) The Central Bank may require that, in supplying information for the purpose of this subsection, the auditor shall act independently of the society.

(5) No duty to which an auditor of a society may be subject shall be regarded as contravened, and no liability to the society, its shareholders, creditors or other interested parties, shall attach to the auditor, by reason of his compliance with any obligation imposed on him by or under this section.

Penalty for false statements to auditors.

90. —(1) An officer or employee of a building society or a subsidiary or other associated body who knowingly or recklessly makes a statement to which this section applies that is misleading, false or deceptive in a material particular shall be guilty of an offence.

(2) This section applies to any statement made to the auditors of a society (whether orally or in writing) which conveys, or purports to convey, any information or explanation which they require under this Act, or are entitled so to require, as auditors of the society.

(3) An officer or employee of a society or of a subsidary or other associated body who fails to provide to the auditors of the society, within 2 days (not including a Saturday, a Sunday or a public holiday) of the making of the relevant requirement, any information or explanations that the auditors require as auditors of the society and that is within the knowledge of or can be procured by the officer or employee shall be guilty of an offence.

(4) In a prosecution for an offence under this section, it shall be a defence for the defendant to show that it was not reasonably possible for him to comply with the requirements under subsection (3) to which the offence relates within the time specified in that subsection but that he complied therewith as soon as was reasonably possible after the expiration of such time.

(5) In this section “officer”, in relation to a subsidiary or other associated body of a society, includes an auditor.

PART VIII

Disputes and Complaints

Settlement of disputes.

91. —(1) Save as otherwise required by or under this Act, this section applies to—

(a) any dispute between a building society and a member of the society in his capacity as a member, or a representative of such a member in that capacity, in respect of any matter, rights or obligations arising from the rules of the society or any provision of this Act or statutory instrument under it, other than the construction or effect of a mortgage deed or of any other contract comprised in or based on a document other than the rules of the society, and

(b) any other dispute or class of dispute to which the rules of a society expressly apply it,

and, accordingly, in this section “dispute” means a dispute to which this section applies.

(2) Where the rules of a society so provide, the Circuit Court may hear and determine a dispute under this section and a determination of the dispute by the Circuit Court shall be final and binding on the parties and any persons claiming under them, but the Circuit Court may, at the request of a party to the dispute, state a case to the High Court on a point of law.

(3) Where the rules of a society provide that a dispute shall be determined by arbitration, the Arbitration Acts, 1954 and 1980, shall, subject to any necessary modifications, apply to that dispute, and—

(a) the rules shall, for the purposes of this subsection, be deemed to be an arbitration agreement within the meaning of the Arbitration Acts, 1954 and 1980;

(b) arbitrators shall be named and selected in accordance with the rules or, if they make no such provision, one arbitrator shall be named by the board of directors and one by the member;

(c) an arbitrator shall not be beneficially interested, whether directly or indirectly, in the funds of the society; and

(d) the society shall maintain a panel of arbitrators and the names of the arbitrators appointed to the panel by the society shall be duly entered in a register kept by the society for this purpose at its chief office and a copy of the register shall be kept available for inspection by members and the Central Bank at reasonable times.

(4) Where the rules of a society provide that a dispute shall be determined by the Central Bank, the Arbitration Acts, 1954 and 1980, shall, subject to any necessary modifications, apply to that dispute, and—

(a) the rules shall, for the purposes of this subsection, be deemed to be an arbitration agreement within the meaning of the Arbitration Acts, 1954 and 1980;

(b) the Central Bank shall be deemed to be a single arbitrator for the purposes of those Acts, and any provision contained therein relating to the appointment of additional arbitrators or umpires shall not apply.

(5) The Minister may by regulations, made after consultation with the Central Bank, provide that the functions of the Bank under subsection (4) shall devolve—

(a) on an adjudicator appointed under a scheme established pursuant to regulations under section 92 , or

(b) if there is no such scheme, on an adjudicator otherwise appointed under a non-statutory scheme for the adjudication of complaints against building societies or their subsidiaries or other associated bodies,

and, so long as such regulations are in force, references to the Central Bank in subsection (4), and in the relevant provisions of the rules of a society, shall be read as references to the said adjudicator.

(6) Nothing in this section shall prevent a society, any member of a society or any person claiming through or under a member, from obtaining in the ordinary course of law any remedy to which the society, member or person is entitled by law in respect of any mortgage or of any other contract other than the rules of a society.

(7) Any reference in the rules of a society to a dispute shall, except in so far as they otherwise expressly provide, be construed as referring only to a dispute to which this section applies.

Investigation of complaints.

92. —(1) The Minister may, by regulations, made after consultation with the Central Bank, require a building society to establish or join in establishing a scheme or schemes for the investigation of complaints against the society or any of its subsidiaries or other associated bodies in relation to a prescribed matter of complaint.

(2) Without prejudice to the generality of subsection (1), regulations under this section may make provision in relation to any one or more of the following—

(a) the establishment and administration of a scheme,

(b) the manner of appointment of an independent adjudicator to conduct investigations,

(c) the matters to be subject to investigation under the scheme,

(d) the grounds on which a complaint must be based,

(e) the powers of, and procedure to be followed in the conduct of investigations by, the adjudicator,

(f) the circumstances in and the extent to which determinations are binding,

(g) the procedures for the making of complaints,

(h) the publication of the adjudicator's findings,

(i) the approval of the scheme by the Central Bank.

(3) The reference of a complaint under a scheme established under this section shall not affect the rights of a member to have a dispute to which section 91 applies determined as provided for by the rules of the society, but any such dispute that relates to a matter covered by such a scheme may, if both the complainant and the society agree, instead of being so determined be determined under such a scheme; such determination being binding on both parties.

PART IX

Savings Protection

Deposit at Central Bank.

93. —(1) A building society shall not exercise any function to which an authorisation under section 17 relates unless it maintains on deposit with the Central Bank an amount determined in accordance with this section.

(2) The amount of a deposit by a society under this section shall be a sum equal to 0.2 per cent., or such other proportion as may be prescribed in regulations made under section 94 , of the society's total liabilities in respect of—

(a) shares and deposits (including deposits on current accounts if any, but, subject to paragraph (b), excluding shares and deposits specified in subsection (4) and deposits represented by negotiable certificates of deposit) denominated in Irish pounds, and

(b) such other shares and deposits as may be prescribed in regulations made under section 94 ,

issued or held by a society at its offices in the State but shall not be less than £20,000.

(3) The amount of the deposit shall be calculated by the Central Bank as soon as practicable after the commencement of this section or at the time of granting an authorisation, as may be appropriate, and shall be recalculated in respect of every society every 12 months (or as close thereto as reasonably practicable) thereafter by reference to such returns as are made by the society at the request of the Bank.

(4) For the purpose of calculating its deposit under this section, shares in and deposits with a society by any of the following shall not be reckoned, that is to say—

(a) another society,

(b) a bank,

(c) a trustee savings bank certified under the Trustees Savings Banks Acts, 1863 to 1979,

(d) the Agricultural Credit Corporation public limited company,

(e) the company formed and registered by virtue of section 2 of the Industrial Credit Act, 1933 ,

(f) any person not being a bank, established outside the State who, in the opinion of the Central Bank, is duly authorised outside the State to carry on the business of banking,

(g) such other persons as may be prescribed in regulations made under section 94 .

(5) The amount of a deposit under this section shall, where necessary, be increased to the appropriate amount calculated under subsection (3) not later than 7 days, or such longer period as the Central Bank may agree to in writing, after the date of the receipt by the society of notification from the Bank of the amount required to effect the increase.

(6) The Central Bank may settle the amount of a deposit under this section at the nearest round figure in hundreds of pounds and by rounding up to such a figure where the amount calculated under subsection (3) is divisible in pounds by £50.

(7) A deposit under this section shall carry interest at such a rate or rates and payable in such manner and at such times as may be determined by the Central Bank from time to time.

(8) Any charge purported to be created on a deposit under this section other than by the Central Bank shall be void.

(9) A deposit under this section shall not be subject to any form of execution in satisfaction of any claim, or any judgment, order or decree of any court in the State in favour of any creditor, otherwise than under and in accordance with the provisions of this Act or regulations made thereunder.

Protection of shareholders' and depositors' funds.

94. —(1) The Minister may, after consultation with the Minister for Finance and the Central Bank, by regulations, provide for the application, subject to such modifications as he considers necessary, to shareholdings in and deposits with building societies of the provisions of any enactment for the protection to any extent of deposits with banks (“the savings protection scheme”).

(2) Without prejudice to the generality of subsection (1), regulations under that subsection may—

(a) provide for the transfer of deposits maintained by building societies with the Central Bank by virtue of section 93 to any account maintained by the Bank for the purposes of the savings protection scheme,

(b) provide, as necessary, for the treatment of shareholdings in a society as deposits with the society for the purposes of the scheme,

(c) provide for the exclusion of a specified class of shareholders in and depositors with a society from protection under the scheme,

(d) specify any class of shareholdings in and deposits with a society that may benefit under the scheme,

(e) change, as necessary, the rights and duties of a liquidator in the winding up of a society,

(f) require that, where the liability of a society to a person is related to both shares and deposits, the amount of any payment under the scheme be first applied to reducing the liability of the society in respect of the shares,

(g) provide for other payments in prescribed circumstances to be charged on the account referred to in paragraph (a),

(h) provide for the amendment as necessary of the relevant enactments referred to in subsection (1),

(i) prescribe shares and deposits for the purposes of section 93 (2) (b) and (4) (g).

PART X

Amalgamations and Transfers of Engagements

Amalgamation of societies.

95. —(1) Subject to compliance with section 97 , any 2 or more building societies may amalgamate by forming a building society as their successor.

(2) In order to form a society as their successor the amalgamating societies must—

(a) agree on the objects of their successor and the extent of its powers in a memorandum which complies with the requirements for the time being of Part I of the Second Schedule ,

(b) agree on the rules for the regulation of their successor which comply with the requirements of Part II of the Second Schedule and any regulations for the time being made under section 11 (2),

(c) each approve the terms of the amalgamation by special resolution, which also approves the memorandum and rules of their successor, and

(d) make application jointly under section 98 to the Central Bank for confirmation of the amalgamation and send to the Bank 3 copies of the memorandum and rules of their successor, each copy signed by the secretary of each of the societies.

(3) The Central Bank if it confirms the amalgamation under section 98 , shall, if it is satisfied as respects the matters as to which it must be satisfied before it registers the memorandum and rules of a society, register the memorandum and rules of the successor society and issue to it a certificate of incorporation and specify a date (“the specified date”) as from which the incorporation takes effect.

(4) On the specified date, all the property, rights and liabilities of each of the societies whose amalgamation was confirmed by the Central Bank shall by virtue of this subsection stand transferred to and vested in the society so incorporated as their successor.

(5) On the specified date, each of the societies to which the successor succeeds shall be dissolved by virtue of this subsection; but the transfer effected by subsection (4) shall be deemed to have been effected immediately before the dissolution.

(6) If, on the specified date, the societies whose amalgamation was confirmed by the Central Bank are all authorised, their successor shall be deemed to be authorised for the purposes of this Act as from that date.

(7) The Central Bank shall record in the public file of the successor the fact that, by virtue of subsection (6), the society is deemed to be authorised for the purposes of this Act.

Transfer of engagements.

96. —(1) Subject to compliance with section 97 , a building society may transfer its engagements to any extent to another society which, in accordance with this section, undertakes to fulfil the engagements.

(2) A society, in order to—

(a) transfer its engagements to any extent, or

(b) undertake to fulfil the engagements of another society,

must resolve to do so by a special resolution or, if the Central Bank consents in either case in circumstances where it considers it expedient to do so, by resolution of the board of directors.

(3) The extent of the transfer, as so resolved by the society making and the society taking the transfer, shall be recorded in an instrument of transfer of engagements.

(4) A transfer of engagements between societies shall be of no effect unless—

(a) the transfer is confirmed by the Central Bank under section 98 , and

(b) a registration certificate is issued in respect of the transfer under subsection (5).

(5) Where the Central Bank confirms a transfer of engagements between societies, it shall—

(a) register a copy of the instrument of transfer of engagements, and

(b) issue a registration certificate to the society taking the transfer,

and, on such date as is specified in the certificate and to the extent provided in the instrument of transfer of engagements, the property, rights and liabilities of the society transferring its engagements shall, by virtue of this subsection, stand transferred to and vested in the society taking the transfer.

(6) The Central Bank shall keep a copy of the instrument and of the registration certificate issued under subsection (5) in the public files of the societies involved.

(7) Where all its engagements have been transferred, a society shall, by virtue of this subsection, be dissolved on the date specified in the registration certificate; but the transfer effected by subsection (5) shall be deemed to have been effected immediately before the dissolution.

Statement for members relating to proposed amalgamation or transfer of engagements.

97. —(1) A building society proposing to amalgamate with one or more other societies, to transfer its engagements to another society or to undertake to fulfil the engagements of another society shall, unless the Central Bank, in the case of a society transferring engagements or undertaking to fulfil engagements, has consented under section 96 to its proceeding by resolution of the board of directors, cause to be sent to every member entitled to notice of a meeting of the society a statement, in such form as the Central Bank may direct, showing—

(a) the financial position of each society concerned,

(b) the interest of the directors of each society concerned,

(c) any compensation or consideration proposed to be paid or given to the directors or other officers of each society concerned,

(d) details of any payments proposed to be made to members of each society concerned in consideration of the proposed amalgamation or transfer,

(e) any changes to be made, in connection with the amalgamation or transfer, in the terms governing outstanding loans,

(f) the details of the arrangements proposed in relation to employees of each society, and

(g) any other matter which the Bank may require in the case of a particular amalgamation or transfer.

(2) A statement to be sent to each member of a society under subsection (1) shall be so sent that every member entitled to notice of a meeting of the society receives it not later than the date on which he receives notice of any resolution in favour of the proposal to be moved at a meeting of the society or of any postal ballot to be held on the proposal.

(3) A statement under this section shall not be sent to members unless its contents have been approved by the Central Bank.

Confirmation of amalgamation or transfer.

98. —(1) An application for confirmation by the Central Bank of an amalgamation of building societies or a transfer of engagements shall be made in such manner as the Bank may specify.

(2) A society which makes, or joins in making, an application for confirmation of an amalgamation or a transfer shall, within 7 days after the date of the application, cause to be published, in at least 2 daily newspapers published in the State and circulating in the areas in which the chief offices of the societies concerned in the proposal are situated, a notice giving particulars of the application and indicating that objections or representations relating to it may be made in writing to the Central Bank within such period (being not less than 21 days after the date of publication of the notice) as may be specified in the notice.

(3) A notice under subsection (2) shall be in such form as the Central Bank may specify and shall indicate that a copy of the statement prepared under section 97 may be obtained on demand at the chief office of the society during the ordinary office hours of the society.

(4) Objections and representations relating to an application under subsection (1) may be made to the Central Bank within the period specified in the relevant notice published under subsection (2).

(5) The Central Bank shall allow the society or societies seeking confirmation of an amalgamation or transfer an opportunity to comment on the representations made before the expiration of such period as the Bank specifies in a notice to the society.

(6) The Central Bank, having considered any application, objection, representation and comment under this section, shall either—

(a) confirm the amalgamation or transfer; or

(b) where it is satisfied that—

(i) confirmation would be contrary to the public interest or the Bank's functions as respects societies,

(ii) in the case of an amalgamation or in the case of a transfer which was the subject of a special resolution, some information material to the members' decision about the amalgamation or transfer was not made available to all the members eligible to vote, or

(iii) some relevant requirement of this Act or the rules of any of the societies participating in the amalgamation or transfer was not fulfilled or not fulfilled as regards that society,

subject to subsection (7), refuse to confirm the amalgamation or transfer.

(7) The Central Bank shall not be precluded from confirming an amalgamation or transfer by virtue only of the non-fulfilment of some relevant requirement of this Act or the rules of a society if it appears to the Bank that it could not have been material to the members' decision about the amalgamation or transfer and the Bank is satisfied that the failure may be disregarded for the purposes of this section.

(8) A failure to comply with a requirement of this Part or any rules of a society shall not invalidate an amalgamation or transfer but a society which and any person who fails to comply with any requirement of this Part shall be guilty of an offence.

Compensation for loss of office and bonuses to members.

99. —(1) Where the terms of an amalgamation of, or transfer of engagements between, building societies include provision—

(a) for compensation to be paid by a society to or in respect of any director or other officer of that or any other society for loss of office or diminution of emoluments attributable to the amalgamation or transfer, or

(b) for part of the funds of one or more of the participating societies to be distributed in consideration of the amalgamation or transfer among any of the members of the participating societies,

such provision must be approved by the special resolution giving the approval of the society to the terms of the amalgamation or transfer unless the case falls within subsection (2).

(2) Where the terms of a transfer of engagements between societies include provisions for compensation for loss of office or a distribution of funds as in subsection (1) and a society concerned applies to the Central Bank under section 96 (2) for its consent to the society's approving the transfer of engagements or the undertaking to fulfil engagements by a resolution of the board of directors instead of a special resolution of the society, the Bank shall not give its consent unless it is satisfied that the compensation or the distribution proposed to be made by each society is, in all the circumstances, justified and reasonable.

(3) In this section—

compensation” includes the provision of benefits in kind;

distribution of funds” with reference to members, includes distribution by means of a special rate of interest available to members for a limited period;

loss of office” includes, in relation to an officer of a society holding office in a subsidiary or other associated body of that society by virtue of his position in that society, the loss of that office.

PART XI

Conversion to Public Limited Company

Interpretation of this Part.

100. —In this Part—

borrowing member” has the meaning assigned to it by section 71 ;

company” means a public company limited by shares within the meaning of the Companies Acts;

conversion date” means the date on which the society becomes converted and is registered as a company;

conversion scheme” means a scheme drawn up by the board of directors of a society for the conversion of the society into a company;

successor company” means the company into which a society converts itself.

Conversion of a society to a public limited company.

101. —(1) A building society may, subject to this Part, convert itself into a company.

(2) In order to convert into a company a society must—

(a) approve a conversion scheme by a conversion resolution pursuant to section 71 ,

(b) obtain the confirmation of the Central Bank to the conversion scheme under section 104 , and

(c) have the society registered as a company under the Companies Acts in accordance with the provisions of this Part and any regulations made thereunder.

(3) A conversion scheme for the purposes of subsection (2) shall—

(a) state the name of the proposed company,

(b) state in relation to the proposed company the amount of the proposed authorised share capital and the amount of such capital proposed to be issued on conversion,

(c) have annexed to it the memorandum of association and the articles of association of the proposed company that comply with the requirements of the Companies Acts,

(d) specify the names of the persons who are proposed to be the first directors and auditors of the proposed company,

(e) specify the persons or classes of persons who will be members of the proposed company,

(f) specify, in the case of persons or classes of persons who are members of the society and who will be members of the proposed company, by reference to the shareholding of those persons or classes of persons in the society—

(i) their entitlement to shares in the proposed company, and

(ii) their rights (if any) to subscribe for shares in the proposed company,

and, in either case, the rights attaching to the shares,

(g) specify, in the case of persons or classes of persons (if any) who are members of the society and who will not be members of the proposed company, the rights and liabilities of such persons or classes of persons,

(h) specify the changes proposed in the society's investments (if any) in subsidiaries and other associated bodies in consequence of the conversion,

(i) specify, in the case of persons or classes of persons who are members of the society at the conversion date, the rights of such persons or classes of persons to a distribution of its assets in the event of the successor company being wound up within 5 years of the conversion date, and if there are to be no such rights the scheme shall so state,

(j) specify the terms on which the shareholdings of members of the society will be held as deposits by the successor company,

(k) specify the terms of any proposed distribution of the funds of the society in connection with the conversion scheme, and

(l) provide for such other and related matters as the Central Bank may specify.

(4) A society proposing to convert into a company shall, at least 6 months prior to the date on which the conversion resolution is intended to be moved at a general meeting of the society or voted on in a postal ballot, advise the Central Bank of the intention to do so and shall consult with the Bank as to the matters to be provided for in the conversion scheme.

(5) A conversion scheme under this section shall not be sent to the members of the society unless the scheme has been approved by the Central Bank as meeting the requirements of or under this Part.

(6) The terms of a conversion scheme shall restrict any rights conferred on members of the society entitling them to shares in the successor company, to acquire shares in the successor company in priority to other subscribers or to any distribution of the funds of the society, in the case of those persons who become members of the society after 21 December, 1988, to those members who held shares in the society throughout the period of 2 years which expired with the day on which notice is given to members of the conversion resolution.

Protective provisions.

102. —(1) A successor company shall not for a period of 5 years after the conversion date—

(a) offer to the public, or allot or agree to allot with a view to their being offered for sale to the public, any shares in or debentures of the company,

(b) allot or agree to allot any share in or debenture of the company, or

(c) register a transfer of shares in or debentures of the company,

if the effect of—

(i) the offer, the allotment or the registration of the transfer would be that 15 per cent. or more of the shares in or debentures of the company would be held by, or by nominees for, any one person, or

(ii) the offer, the allotment or the registration of the transfer of shares would be that 15 per cent. or more of the voting rights attaching to the company's shares would be held by, or by nominees for, any one person or by persons or their nominees acting in concert.

(2) The articles of association of the successor company shall include provisions such as will secure that the company shall not take any action in contravention of subsection (1) and no alteration in these provisions shall be made by the company during the 5 year period specified in that subsection.

(3) Any allotment or registration of a transfer of shares or debentures in contravention of subsection (1) shall be void and any voting rights held by, or by nominees for, any one person or by persons or their nominees acting in concert in excess of a figure representing 15 per cent. of the total voting rights shall not be exercisable by that person or persons or by their nominees.

(4) The Central Bank may, if it considers it necessary to do so in the interests of depositors with the successor company, direct by notice to the company that subsections (1), (2) and (3) shall cease to apply to it.

(5) In this section “transfer” in relation to shares or debentures does not include a transfer to a person to whom the right to any shares or debentures has been transmitted by operation of law.

Conversion statement.

103. —(1) Before a conversion resolution is moved pursuant to section 101 a statement in accordance with subsection (2) shall be sent by the building society to every member entitled to notice of the meeting of the society at which the conversion resolution is to be moved or, as the case may be, of the postal ballot.

(2) Every statement required by subsection (1) shall—

(a) summarise in sufficient detail, to enable persons entitled to vote to decide how to vote on the resolution, the matters required to be referred to in, and the documents required to be annexed to, the conversion scheme by section 101 ;

(b) state the reasons for the proposal to convert;

(c) specify any proposed change in the principal activities of the society to be carried on by its successor with particular reference to its proposed policy in relation to the making of loans for the provision and improvement of housing and the determination of the rate of interest to be charged on such subsisting and future loans;

(d) state the financial position and record of the society and its subsidiaries;

(e) state the interest (if any) of the officers of the society in the conversion;

(f) state the compensation or other consideration (if any) proposed to be paid to or in respect of the officers of the society;

(g) state the manner in which the salary, fees, borrowing rights and other benefits of officers of the society to be appointed to any position by the successor company or any company associated with it will be affected;

(h) state that a full and complete copy of the scheme for conversion may be obtained on demand and free of charge by any member at every place of business of the society at any time during normal business hours; and

(i) deal with such other matters as the Central Bank may specify.

(3) A statement under this section shall not be sent to members of the society unless the contents have been approved by the Central Bank.

Confirmation and registration of conversion scheme by Central Bank.

104. —(1) An application by a building society that has duly approved a conversion scheme in accordance with this Part shall be made to the Central Bank for confirmation of the scheme within 14 days of the meeting at which the society approved the scheme by forwarding to the Bank a copy of the resolution as passed together with 3 copies of the scheme as approved by the society.

(2) Subsections (1) to (5), (7) and (8) of section 98 shall, subject to this section and any necessary modifications, apply to an application to the Central Bank for confirmation of a conversion scheme under this section.

(3) The Central Bank shall notify the Minister and the Minister for Finance when confirming a conversion scheme.

(4) The Central Bank, having considered an application under subsection (1), any objection or representation received and any comment by the society shall confirm the conversion scheme unless it is of the opinion that—

(a) confirmation would be contrary to the public interest, or

(b) some information material to the members' decision about the conversion scheme was not made available to all the members eligible to vote, or

(c) some relevant requirement of this Act or the rules of the society was not fulfilled, or

(d) there is a substantial risk that the successor company will not be granted a licence under section 9 of the Act of 1971.

(5) Where the Central Bank confirms a conversion scheme it shall register the scheme and the conversion resolution and send to the applicant a certificate of registration which shall be sufficient evidence unless the contrary is proved that the requirements of this Part in relation to the conversion scheme have been complied with.

(6) The Central Bank shall forthwith publish such notice of confirmation and registration of the scheme as it considers appropriate.

Petition to High Court against conversion scheme.

105. —(1) A petition for the cancellation of a conversion scheme as confirmed under section 104 may be made to the Court—

(a) by not less than 100 members who were qualified to vote on the conversion resolution approving the conversion scheme, or

(b) with the approval of the Court, by any member of the society.

(2) A petition under this section shall be made within one month after the date on which the Central Bank has published notice of its confirmation and registration of the conversion scheme under section 104 .

(3) A petition under subsection (1) (a) may be made on behalf of one or more of the persons entitled to make the petition by such one or more of their number as may be appointed in writing for the purpose.

(4) Where a petition has been made to the Court, the Court shall as soon as may be send a copy of the petition to the Central Bank and to the society.

(5) On a petition under subsection (1) the Court may make an order confirming or cancelling the conversion scheme on such terms and conditions as it thinks fit.

(6) In exercising its powers under subsection (5) the Court shall have regard only to the rights and interests of the members of the society, or any class of them.

(7) No appeal from any order made under subsection (5) shall be brought after the expiration of one month from the date of perfection of the order.

Registration of society as a company.

106. —(1) As soon as may be but not sooner than one month after the registration pursuant to section 104 (5) and, where a petition is made to the Court under section 105 , the petition is finally determined, the building society shall deliver, to the registrar of companies—

(a) the following documents—

(i) a copy of the conversion resolution under section 101 certified by the Central Bank as registered under section 104 ,

(ii) a copy of the scheme confirmed and registered by the Central Bank under section 104 ,

(iii) the Court order under section 105 , if any,

(iv) the certificate of incorporation of the society as a building society,

and

(b) the memorandum and articles of association of the successor company and such other documents and fee as are required under the Companies Acts to register a company.

(2) On receiving the documents listed in subsection (1) and on being satisfied that all the requirements of the Companies Acts in respect of registration of memorandum and articles and of matters precedent and incidental thereto have been complied with the registrar of companies shall retain and register the memorandum and articles and issue a certificate of incorporation for the company.

(3) The certificate of incorporation as a company shall be sufficient evidence until the contrary is shown that the requirements of this section have been complied with and that the society was on the date shown in the certificate duly registered as a company under the Companies Acts.

(4) On the date shown in the certificate of incorporation as a company the society shall cease to be incorporated under this Act and shall be a company incorporated under the Companies Acts and those Acts shall apply to it accordingly.

(5) The registrar of companies shall forthwith publish as he considers appropriate notice of the registration of the society as a company.

(6) On the registration of a society as a company—

(a) all persons who are to be members of the company shall in accordance with the terms of the conversion scheme be members of the company; and

(b) the shares, if any, in the capital of the company to which all such persons are entitled in accordance with the conversion scheme shall be deemed to be allotted to such persons.

(7) Notwithstanding anything contained in section 58 or section 116 of the Companies Act, 1963 , no company into which a society has become converted pursuant to this Part shall be required within 5 years of the conversion date—

(a) to show on the list required to be delivered to the registrar of companies by section 58 of the Companies Act, 1963 , or

(b) to enter in the register of its members referred to in section 116 of the Companies Act, 1963 ,

the occupation of any person who immediately before the conversion date was a member of the society if the register of members of the society did not contain the occupation of that person.

Consequential provisions on conversion of society.

107. —(1) Where a building society becomes converted into a company pursuant to this Part—

(a) every shareholding in and deposit with the society shall on conversion become a deposit of the same amount with the successor company, and

(b) the business, property, rights and liabilities of the society, shall, on the conversion date, vest in the company.

(2) Without prejudice to the generality of subsection (1), the following provisions shall have effect where a society becomes converted into a company pursuant to this Part, that is to say—

(a) a reference (express or implied) to the society in any instrument made, given, passed, or executed before the conversion date shall be read and construed as a reference to the company;

(b) except as provided in subsection (3), all contracts, agreements, conveyances, mortgages, deeds, leases, licences, other instruments, undertakings and notices (whether or not in writing) entered into by, made with, given to or by, or addressed to the society (whether alone or with any other person) before the conversion date and subsisting immediately before the conversion date shall, to the extent that they were previously binding on and enforceable by, against, or in favour of the society, be binding on and enforceable by, against, or in favour of the company as fully and effectually in every respect as if, instead of the society, the company had been the person by whom they were entered into, with whom they were made, or to or by whom they were given or addressed as the case may be;

(c) an instruction, order, direction, mandate, or authority given to the society and subsisting immediately before the conversion date shall be deemed to have been given to the company;

(d) a security held by the society as security for a debt or other liability to the society incurred before the conversion date shall be available to the company as security for the discharge of that debt or liability and, where the security extends to future or prospective debts or liabilities, shall be available as security for the discharge of debts or liabilities to the company incurred on or after the conversion date; and, in relation to a security, the company shall be entitled to all the rights and priorities (howsoever arising) and shall be subject to all liabilities to which the society would have been entitled or subject if the society had not become converted into a company;

(e) all the rights and liabilities of the society as bailor or bailee of documents or chattels shall be vested in and assumed by the company;

(f) a negotiable instrument or order for payment of money which before the conversion date is drawn on or given to or accepted or endorsed by the society or payable at a place of business of the society shall, unless the context otherwise requires, have the same effect on and after the conversion date as if it had been drawn on or given to or accepted or endorsed by the company instead of the society or was payable at the place of business of the company;

(g) nothing effected or authorised by this Part—

(i) shall be regarded as placing the society, or the company, or any other person in breach of contract or confidence or as otherwise making any of them guilty of a civil wrong; or

(ii) shall be regarded as giving rise to a right to any person to terminate or cancel any contract or arrangement or to accelerate the performance of any obligation; or

(iii) shall be regarded as placing the society, or the company, or any other person in breach of any enactment or rule of law or contractual provision prohibiting, restricting or regulating the assignment or transfer of any property or the disclosure of any information; or

(iv) shall release any surety wholly or in part from any obligation; or

(v) shall invalidate or discharge any contract or security;

(h) any action, arbitration or proceedings, or cause of action which immediately before the conversion date is pending or existing by, against, or in favour of the society or to which the society is a party may be prosecuted, and without amendment of any writ, pleading, or other document, continued and enforced by, against, or in favour of the company;

(i) on the conversion date each employee of the society shall become an employee of the company but, for the purposes of every enactment, law, award, determination, contract and agreement relating to the employment of each such employee, the contract of employment of that employee, shall be deemed to have been unbroken and the period of service with the society shall be deemed to have been a period of service with the company, and the terms and conditions of employment of each such employee shall, until varied, be identical with the terms and conditions of that employee's employment with the society immediately before the conversion date and be capable of variation in the same manner.

(3) Where a society becomes converted into a company pursuant to this Part and the conversion scheme provides for the conversion or alteration of the rights or liabilities of any person that were subsisting immediately before the conversion date, those rights and liabilities shall, notwithstanding subsection (2), cease to be enforceable by, against, or in favour of the company on or after the conversion date except in accordance with that scheme.

(4) Where a society becomes converted into a company pursuant to this Part and the conversion scheme provides for any rights or liabilities to arise immediately after the conversion date, those rights and liabilities shall be enforceable by, against, or in favour of the company on and after the conversion date.

Conversion regulations.

108. —The Minister for Finance may, by regulations, make further provision in relation to the conversion of a building society into a company under this part including provision for and in connection with the transition from regulation and supervision by and under this Act to regulation and supervision by and under the Companies Acts and the Currency and Central Bank Acts, 1927 to 1971.

PART XII

Winding up, etc.

Winding up.

109. —(1) Subject to this section, a building society may be wound up in accordance with the Companies Acts and accordingly those Acts shall, subject to any necessary modifications, apply as if the society were a company limited by shares.

(2) In the application of the Companies Acts to the winding up of a society—

(a) a reference to “the registrar of companies” in the Act of 1963 shall be construed as a reference to the Central Bank,

(b) a reference to “the articles of association” in the Act of 1963 shall be construed as a reference to the rules of a society,

(c) a reference to “a special resolution” in the Act of 1963 shall be construed as a reference to a special resolution of a society within the meaning of this Act, and

(d) “secretary” in section 224 of the Act of 1963 shall be construed as the chief executive of a society.

(3) A society may be wound up by the Court if—

(a) the society has by special resolution resolved that the society be wound up by the Court,

(b) the number of members is reduced below 10 or the number of directors below 3,

(c) the society, being a society registered as a building society under this Act or the repealed enactments, has not been granted an authorisation and more than one year has expired since it was so registered,

(d) the society is unable to pay its debts,

(e) the society has had its authorisation revoked under section 40 , or

(f) the Court is of opinion that it is just and equitable that the society should be wound up.

(4) (a) A petition for the winding up of a society may, notwithstanding anything in section 215 of the Act of 1963, be presented by the Central Bank.

(b) Sections 213 and 215 (a) and (d) and 296 of the Act of 1963 shall not apply to the winding up of a society.

(5) Notwithstanding anything in sections 217, 234, 256, 280 and 298 of the Act of 1963, an application to the Court under any of those sections may be made by the Central Bank.

(6) The winding up of a society shall not bar the right of the Central Bank to have it wound up by the Court.

(7) Notice of any resolution or application for the winding up of a society shall be given to the Central Bank.

(8) Part X of the Act of 1963 shall not apply to a society and, notwithstanding anything in that or any other Act, a society may not be wound up except in accordance with this section.

(9) Where a society is being wound up, a person to whom a loan has been made by the society under a mortgage or other security shall not be liable to pay the amount payable in respect of the loan except at the time or times and subject (as may be appropriate) to the conditions set out in the mortgage or other security.

(10) The liquidator in the exercise of his powers under section 231 (2) (a) of the Act of 1963 shall not dispose of any of the society's assests secured by mortgage of freehold or leasehold estate or interest on terms as respects the loans other than terms which the Court is satisfied are just and equitable and which the borrowers would have been reasonably entitled to expect if the society had not been wound up.

(11) The Central Bank may appoint one or more officers of the Bank or other representatives who shall be entitled to—

(a) attend any meeting of creditors of a society, and

(b) be a member of any committee of inspection appointed under section 233 or 268 of the Act of 1963.

(12) An officer or representative of the Central Bank appointed to be a member of a committee of inspection shall not be removed from office without the consent of the Bank and shall not be counted in computing any minimum or maximum number of members of such committee specified in any enactment.

(13) Where the winding up of a society commences within one year after the society has changed its name, the former name as well as the existing name shall appear on all notices and advertisements relating to the winding up.

Cancellation of registration.

110. —(1) The Central Bank shall cancel the registration of a building society that has been—

(a) dissolved by virtue of section 95 or 96 ,

(b) wound up under section 109 and dissolved, or

(c) converted into a public limited company under Part XI .

(2) Where the Central Bank is satisfied, with respect to a society—

(a) that a certificate of incorporation has been obtained for the society by fraud or mistake and that the society is not an authorised society,

(b) that the society has ceased to function, or

(c) that the society has failed to comply with section 124 (5),

the Bank may cancel the registration of the society.

(3) Without prejudice to subsection (2), the Central Bank may, if it thinks fit, cancel the registration of a society at the society's request, evidenced in such manner as the Bank may direct.

(4) Before cancelling the registration of a society under subsection (2), the Central Bank shall give to the society not less than 2 months' notice, specifying the grounds of the proposed cancellation.

(5) Where the registration of a society is cancelled under subsection (2), the society may within 1 month appeal to the Court and on any such appeal the Court may, if it thinks proper, set aside the cancellation.

(6) Where the registration of a society is cancelled under subsection (2) or (3), then, subject to the right of appeal conferred by subsection (5), the society shall cease to be a building society within the meaning of this Act.

(7) Subsection (6) shall have effect in relation to a society without prejudice to any liability actually incurred by the society and any such liability may be enforced against the society as if the cancellation had not taken place.

(8) As soon as practicable after the cancellation of the registration of a society under this section, the Central Bank shall cause notice thereof to be published in at least 2 daily newspapers published in the State and circulating in the area in which the chief office of the society is situated.

Liability of officers of society to penalty where proper accounting records not kept.

111. —(1) If—

(a) a society that is being wound up and that is unable to pay all of its debts has contravened section 76 , and

(b) the Court considers that such contravention has contributed to the society's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the society or has substantially impeded the orderly winding up thereof,

every officer of the society who is in default shall be guilty of an offence.

(2) In a prosecution for an offence under this section it shall be a defence for the person charged to show that—

(a) he took all reasonable steps to secure compliance by the society with section 76 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director of the society who has been formally allocated such responsibility, was charged with the duty of ensuring that that section was complied with and was in a position to discharge that duty.

Personal liability of officers of society where proper accounting records not kept.

112. —(1) Subject to subsection (2), if a society that is being wound up and that is unable to pay all of its debts has contravened section 76 , and the Court considers that such contravention has contributed to the society's inability to pay all of its debts or has resulted in substantial uncertainty as to the assets and liabilities of the society or has substantially impeded its orderly winding up the Court, on the application of the liquidator or the Central Bank or any creditor or contributory of the society may, if it thinks it proper to do so, declare that any one or more of the officers and former officers of the society who is or are in default shall be personally liable, without any limitation of liability, for all, or such part as may be specified by the Court, of the debts and other liabilities of the society.

(2) On the hearing of an application under subsection (1), the person bringing the application may himself give evidence or call witnesses.

(3) (a) Where the Court makes a declaration under subsection (1), it may give such directions as it thinks proper for the purpose of giving effect to the declaration and in particular may make provision for making the liability of any such person under the declaration a charge on any debt or obligation due from the society to him, or on any mortgage or any interest in any mortgage on any assets of the society held by or vested in him or any company or other person on his behalf, or any person claiming as assignee from or through the person liable under the declaration or any company or person acting on his behalf, and may from time to time make such further order as may be necessary for the purpose of enforcing any charge imposed under this subsection.

(b) In paragraph (a)assignee” includes any person to whom or in whose favour, by the directions of the person liable, the debt, obligation or mortgage was created, issued or transferred or the interest created, but does not include an assignee for valuable consideration (not including consideration by way of marriage) given in good faith and without notice of any of the matters on the ground of which the declaration is made.

(4) The Court shall not make a declaration under subsection (1) in respect of a person if it considers that—

(a) he took all reasonable steps to secure compliance by the society with section 76 , or

(b) he had reasonable grounds for believing and did believe that a competent and reliable person, acting under the supervision or control of a director who has been formally allocated such responsibility, was charged with the duty of ensuring that this section was complied with and was in a position to discharge that duty.

(5) This section shall have effect notwithstanding that the person concerned may be criminally liable in respect of the matters on the ground of which the declaration is to be made.

(6) In this section “officer”, in relation to a society, includes a person who has been convicted of an offence under section 90 or 120 in relation to a statement concerning the keeping of proper accounting records by the society.

PART XIII

Miscellaneous

Financial year of a society.

113. —(1) The financial year of a building society shall be the period of 12 months ending on a 31st day of December.

(2) The initial financial year of a society shall be such period as expires with the end of the calendar year in which it is formed and the final financial year of a society shall be such shorter period than 12 months as expires with the date to which the society makes up its final accounts.

Liability of officer.

114. —(1) Any provision (whether contained in the rules of a building society or in any contract with a society or otherwise) for exempting an officer or auditor of a society from, or indemnifying him against, any liability which by virtue of any rule of law would otherwise attach to him in respect of any negligence, default, breach of duty or breach of trust of which he may be guilty in relation to the society shall, subject to subsection (2), be void.

(2) A society may indemnify such officer or auditor against any liability incurred by him in defending proceedings, whether civil or criminal, in which judgment is given in his favour or in which he is acquitted, or in connection with any application under section 115 in which relief is granted to him.

Court's power to grant relief to an officer of a society.

115. —(1) Where in any proceedings for negligence, default, breach of duty or breach of trust against an officer or auditor of a building society it appears to the court hearing the case that that officer or auditor is or may be liable in respect of the negligence, default, breach of duty or breach of trust, but that he acted honestly and reasonably and that, having regard to all the circumstances of the case (including those connected with his appointment), he ought fairly to be excused for the negligence, default, breach of duty or breach of trust that court may relieve him (either wholly or partly) from his liability on such terms as the court may think fit.

(2) Where an officer or auditor of a society has reason to apprehend that any claim will or might be made against him in respect of any negligence, default, breach of duty or breach of trust, he may apply to the Court for relief, and the Court on any such application shall have the same power to relieve him as it would have had under this section if it had been a court before which proceedings against that person for such negligence, default, breach of duty or breach of trust had been brought.

(3) Where any case to which subsection (1) applies is being tried by a judge with a jury, the judge, after hearing the evidence, may, if he is satisfied that the defendant ought under that subsection to be relieved either in whole or in part from the liability sought to be enforced against him, withdraw the case in whole or in part from the jury and direct judgment to be entered for the defendant on such terms as to costs or otherwise as the judge may think proper.

Provisions as to evidence.

116. —(1) A certificate of incorporation or of registration or other document relating to a building society, purporting to be signed by an authorised officer of the Central Bank, or by the Registrar of Building Societies under the repealed enactments, shall, in the absence of any evidence to the contrary, be deemed to have been issued by the Central Bank, or the Registrar as the case may be and shall be received in evidence accordingly.

(2) A printed document purporting to be a copy of the memorandum or rules of a society and certified by an officer of the society to be a true copy of its registered memorandum or rules shall, in the absence of any evidence to the contrary, be deemed to be a true copy of its memorandum or rules and shall be received in evidence accordingly.

Form of registers, records, etc.

117. —(1) A building society shall maintain, in addition to the records required to be kept by a society by virtue of section 76 , such other records as may be specified by the Central Bank.

(2) Any register or record required to be kept by or under this Act may be kept either by making entries in bound books or by recording the matters in question in any other manner provided such recording is readily accessible and readily convertible into written form in an official language of the State.

(3) Any duty imposed by this Act to allow inspection of, or to furnish a copy of, a record, or any part of it, is to be treated as a duty to allow inspection of, or to furnish, a reproduction of the recording or of the relevant part of it in a written form in an official language of the State.

(4) Where any register or record required to be kept by or under this Act is not kept by making entries in a bound book but by some other means, adequate precautions shall be taken by the person required to keep the register or record for guarding against falsification and for facilitating the discovery of any such falsification.

(5) The Central Bank may, from time to time, specify the form of any application, notice or other document required to be made or sent to it under this Act.

(6) Without prejudice to any other provision of this Act, the Central Bank may fix fees to be paid for the inspection of any document or the furnishing of any copies in its custody or in connection with the exercise by it of any of its functions under this Act and any moneys so received by it shall be paid into the general fund of the Bank.

Exemption from stamp duty.

118. —(1) Stamp duty shall not be chargeable on any instrument effecting the transfer of a share in a building society.

(2) Stamp duty, other than stamp duty provided for in sections 67 to 75 of the Finance Act, 1973, shall not be chargeable on any transfer, conveyance or other instrument executed for the purposes of effecting an amalgamation of societies or a transfer of engagements under Part X or the conversion of a society into a public limited company under Part XI .

Offences.

119. —(1) (a) A building society or a person that—

(i) has obtained an authorisation through false statements or any other irregular means,

(ii) contravenes section 17 , 18 (3), 25 or 41 ,

(iii) commits by act or omission a breach of a condition duly imposed on an authorisation under section 17 or an approval to exercise a power under section 36 , or

(iv) fails to comply with a direction under section 40 , the Fourth Schedule or section 42 or a requirement under section 39 ,

shall be guilty of an offence and shall be liable—

(I) on summary conviction, to a fine not exceeding £1,000 or, at the discretion of the court in the case of an individual, to imprisonment for a term not exceeding 12 months or both, or

(II) on conviction on indictment, to a fine not exceeding £50,000 or, at the discretion of the court in the case of an individual, to imprisonment for a term not exceeding 5 years or both.

(b) If the contravention, breach or failure in respect of which the society or any person was convicted under paragraph (a) is continued after conviction, it or he shall be guilty of a further offence on every day on which the contravention, breach or failure continues and for each such offence the society or person shall be liable on summary conviction to a fine not exceeding £100 or on conviction on indictment to a fine not exceeding £5,000 instead of the penalty specified for the original contravention, breach or failure.

(2) A society or a person that contravenes a requirement of or under this Act shall be guilty of an offence.

(3) (a) A society or any person guilty of an offence under subsection (2), or guilty of an offence under any other provision of this Act for which no penalty is specifically provided, shall be liable—

(i) on summary conviction to a fine not exceeding £1,000 or, at the discretion of the court in the case of an individual, to imprisonment for a term not exceeding 12 months or to both; or

(ii) on conviction on indictment, to a fine not exceeding £10,000 or, at the discretion of the court in the case of an individual, to imprisonment for a term not exceeding 3 years or to both.

(b) If the contravention in respect of which a society or person was convicted under paragraph (a) is continued after the conviction it or he shall be guilty of a further offence on every day on which the contravention continues and for each such offence the society or person shall be liable on summary conviction, to a fine not exceeding £50 or, on conviction on indictment, to a fine not exceeding £1,000, instead of the penalty specified for the original contravention.

(4) Summary proceedings in relation to an offence under this Act may be brought and prosecuted by the Director of Public Prosecutions or the Central Bank.

(5) Notwithstanding section 10 (4) of the Petty Sessions (Ireland) Act, 1851, summary proceedings for an offence under this Act may be instituted within 3 years from the date of the offence.

(6) Where an offence under this Act committed by a society or other body corporate or by a person purporting to act on behalf of the society or other body corporate is proved to have been so committed with the consent, or connivance of, or to be attributable to, or to have been facilitated by, any neglect on the part of any officer or employee of that society or body, that person shall be guilty of the offence.

Furnishing false information, etc.

120. —(1) A person who, in purported compliance with any provision of this Act or any regulation thereunder, provides an answer or explanation, makes a statement or produces, lodges or delivers any return, report, certificate, balance sheet or other document false in a material particular, knowing it to be false, or recklessly provides an answer or explanation, makes a statement or produces, lodges or delivers any such document false in a material particular shall be guilty of an offence.

(2) Where a person is guilty of an offence under subsection (1) and the Court is of opinion that any act, omission or conduct which constituted that offence has—

(a) substantially contributed to a society being unable to pay its debts,

(b) prevented or seriously impeded the orderly winding up of the society, or

(c) substantially facilitated the defrauding of the creditors of the society or creditors of any other person,

that person shall be liable on conviction on indictment to a fine not exceeding £50,000 or to imprisonment for a term not exceeding 7 years or to both.

(3) (a) An officer of a society who destroys, mutilates or falsifies, or is privy to the destruction, mutilation or falsification of any record or document affecting or relating to the property or affairs of the society, or makes or is privy to the making of a false entry therein, shall, unless he proves that he had no intention to defeat the law, be guilty of an offence.

(b) Any such person as is mentioned in paragraph (a) who fraudulently parts with, alters or makes an omission in any such record or document, or who is privy to the fraudulent parting with, altering or making of an omission in any such record or document, shall be guilty of an offence.

(4) Where a person is guilty of an offence under subsection (3) that person shall be liable on conviction on indictment to a fine not exceeding £50,000 or to imprisonment for a term not exceeding 7 years or to both.

Judgments against a society.

121. —(1) Whenever a person (in this section referred to as a judgment creditor) obtains in any court a judgment, order or decree against a building society for the payment of a sum of money due to the judgment creditor by the society, the registrar or clerk of the court concerned shall notify the Central Bank as soon as may be of the judgment, order or decree and of its terms and of any appeal against the judgment, order or decree and of the result thereof.

(2) Subject to subsection (3), if within the period of 21 days beginning on the date of the judgment, order or decree, the society does not pay all moneys due (or in the case of costs, at the option of the society, give security therefor in lieu of payment) or satisfy all claims under the judgment, order or decree, the society shall be deemed to be unable to meet its obligations to its creditors and, for the purposes of section 109 , to be unable to pay its debts.

(3) If an appeal is instituted in any court against the judgment, order or decree, that court or the court by which the judgment, order or decree was made may by order postpone the application of subsection (2) for such period and, subject to subsection (4), on such terms as the court concerned may fix and specify in the order.

(4) If a court makes an order under subsection (3), it may require the society to which the order relates either, as that court thinks fit, to lodge in court an amount equal to the amount of all moneys due under the judgment, order or decree (or such lesser amount as the court may direct) or to give such security as the court may determine for the payment to the judgment creditor of all such moneys, together with, in either case, such further sum or security for the costs of the appeal as the court shall consider just.

(5) An order under subsection (3) may be varied or revoked by the court that made it or before which an appeal in relation to it is brought.

Public file of a society.

122. —(1) The Central Bank shall prepare and maintain at its head office a file relating to each building society, to be known as the public file of the society, and such file shall contain the documents or, as the case may be, the copies of the documents, and the records of the matters directed by or under this Act to be kept in the public file of the society.

(2) Any member of the public shall be entitled to—

(a) inspect the public file of any society having first given reasonable notice, or

(b) be furnished with a copy of all or any of the documents or records kept in the public file of the society on payment of such fee, if any, as may be determined by the Central Bank.

Subsidy by Minister in respect of interest on housing loans made by a society.

123. —(1) The Minister may, in accordance with a scheme approved by the Minister for Finance, pay, out of moneys provided by the Oireachtas, a subsidy to a building society in respect of interest payable to the society by a member in respect of a housing loan.

(2) A scheme under this section may, without prejudice to the generality of subsection (1), specify—

(a) a class or classes of persons in respect of which a subsidy may be paid by reference to their financial circumstances,

(b) a class or classes of loans in respect of which the subsidy may be paid, or

(c) a class or classes of houses securing the loan in respect of which the subsidy may be paid.

(3) In this section, “housing loan” includes an outstanding loan secured by a mortgage of freehold or leasehold estate or interest in a house under the repealed enactments.

Savings and transitional provisions.

124. —(1) (a) Any order, regulation, rule, agreement, appeal, application, conveyance, decision, lease, loan, mortgage, payment or reference made or any approval, consent or direction given, requirement imposed, certificate or instrument issued, register kept, resolution passed, notice served or any other thing done under any enactment repealed by this Act that could have been made, given, imposed, issued, kept, passed, served or done under a corresponding provision of this Act, shall not be invalidated by any repeal effected by this Act but shall, if in force immediately before that repeal was effected, have effect as if made, given, imposed, issued, kept, passed, served or done (as the case may be) under the corresponding provision of this Act, unless otherwise provided.

(b) Paragraph (a) shall apply to anything done by the Registrar, the Minister or Minister for Finance that could be done by the Central Bank under this Act.

(2) The repeals effected by this Act shall not affect the registration or incorporation of any building society registered or incorporated under an enactment so repealed, and any such registration or incorporation shall be deemed to be a registration or incorporation under this Act.

(3) Where any act or omission is an offence under an enactment repealed by this Act and that enactment provides a penalty for the continuation of the offence, the continuation of the act or omission after the commencement of this section shall be an offence under the provision of this Act which corresponds to the provision of the repealed enactment creating the offence.

(4) A reference in any other enactment or in any document to an enactment repealed by this Act shall, unless the context otherwise requires, be construed as a reference to the corresponding provision of this Act.

(5) A society incorporated under the repealed enactments shall, within a period of 2 years from the commencement of this section—

(a) agree by special resolution on—

(i) the objects of the society,

(ii) whether to adopt any and, if so, what adoptable powers (with or without restrictions), and

(iii) whether to assume and, if so, what restrictions on the extent of its other powers under this Act,

in a memorandum the provisions of which comply with the requirements of Part I of the Second Schedule ;

(b) agree by special resolution on rules so that they conform with this Act and any regulations made thereunder; and

(c) deliver to the Central Bank 3 copies of the memorandum or the rules, as the case may be, each signed by the secretary of the society and accompanied by a statutory declaration by the secretary that the memorandum or rules were agreed by resolution passed as a special resolution and apply to have the memorandum or rules registered.

(6) Subsections (3), (5) and (6) of section 14 shall apply, subject to any necessary modifications, with respect to any document delivered to the Central Bank under subsection (5) (c).

(7) In agreeing on its memorandum or rules under subsection (5), the society shall, subject to subsection (8), determine the date on which the society intends it to take effect and the memorandum or rules is sent to the Central Bank shall be accompanied by a statement specifying that date.

(8) The provisions of a memorandum or rules registered under this section shall take effect on the date specified in subsection (7) or, if registration of the memorandum or rules is not effected until a later date, that later date.

(9) No date shall be specified under subsection (7) in relation to a society's memorandum or rules which falls more than 6 months after the date of the meeting at which the society agreed upon the memorandum or rules, as the case may be.

(10) The rules of a society in force on 21 December, 1988, shall remain in force in respect of that society until the date determined in accordance with subsection (8) but the provisions of this Act, other than Part II of the Second Schedule , shall have effect and the said rules shall be construed accordingly.

(11) An existing director of a society shall be treated for the purposes of section 50 as having been duly elected a director on the date of his election as director or, as the case may be, of his most recent re-election to that office before the commencement of this section.

(12) If the term of office of an existing director would, in accordance with the terms on which he holds office, expire on an earlier date than is provided for by subsection (11), he shall vacate office on that earlier date.

(13) If at the commencement of this section, an existing director has held office since the date of his election or most recent re-election for a period longer than is provided for in section 50 (10), he shall retire from office at the first annual general meeting of the society after the commencement of this section.

Transfer of functions to Central Bank.

125. —(1) From the commencement of this section, proceedings in relation to building societies pending before the Registrar of Building Societies under the Building Societies Acts, 1976 to 1986, shall be transferred to and dealt with by the Central Bank under this Act.

(2) The Registrar shall, on the commencement of this section, to such extent as may be required by the Central Bank, transfer all documents and records relative to building societies in the possession of his office to the Bank.

Amendments to the Bankers' Books Evidence Acts, 1879 and 1959, and the Bills of Exchange Act, 1882.

126. —(1) Section 9 (1) of the Bankers' Books Evidence Act, 1879 (inserted by the Bankers' Books Evidence (Amendment) Act, 1959 ) is hereby amended by the insertion after paragraph (d) of the following—

“(e) a building society (within the meaning of the Building Societies Act, 1989).”.

(2) Section 2 of the Bills of Exchange Act, 1882, is hereby amended by the substitution of the following definition for the definition of “Banker”—

“‘Banker’ includes a body of persons whether incorporated or not who carry on the business of banking and a building society (within the meaning of the Building Societies Act, 1989).”.

Recognition of building society accounts.

127. —(1) A reference in any enactment to the deposit of money or the keeping of an account in a bank shall, unless the context otherwise requires, be construed as including the deposit of money with or the keeping of an account in a building society that is authorised within the meaning of section 17 and the provisions of any such enactment in relation to the rights and obligations of a bank in respect of accounts in a bank shall apply to a building society as they apply to a bank.

(2) Any deposit or account to which subsection (1) relates may be held in the form of a shareholding in the society.

FIRST SCHEDULE

Enactments Repealed

Section 6 .

Number and Year

Short Title

Extent of Repeal

(1)

(2)

(3)

No. 38 of 1976

Building Societies Act, 1976

The whole Act

No. 27 of 1979

Housing (Miscellaneous Provisions) Act, 1979

Section 20

No. 31 of 1980

Building Societies (Amendment) Act, 1980

The whole Act

No. 25 of 1983

Building Societies (Amendment) Act, 1983

The whole Act

No. 24 of 1984

Land Act, 1984

Section 4 (2)

No. 36 of 1986

Building Societies (Amendment) Act, 1986

The whole Act

SECOND SCHEDULE

Provisions applicable as respects the memorandum and rules

Section 10 .

Part I

The Memorandum

1. The memorandum of a building society shall specify—

(a) the name of the society;

(b) the objects of the society;

(c) the adoptable powers (if any) and any restrictions thereon which the society has adopted in accordance with section 36 ; and

(d) the restrictions (if any) which the society has assumed on the extent of any of its other powers under this Act.

2. In order to comply with paragraph 1 (c) and (d) the terms of each adoptable power and of each restriction on the extent of any power must be set out in the memorandum.

3. For compliance with paragraph 1 (c) as respects the powers referred to in section 28 the memorandum shall state the fact that the powers of investment and support have been adopted in the case of bodies corporate or approved housing bodies and the purpose of the investment or support.

4. Where any power that a society has adopted under this Act ceases to be exercisable by a society the society shall annex to its memorandum a note of that fact and the date from which it has so ceased and shall send a copy of the note to the Central Bank which shall keep the copy in the public file of the society.

Part II

The Rules

5. The rules of a building society shall provide for the following—

(a) the name of the society;

(b) the manner in which the society may change its chief office;

(c) the manner of determination of the terms on which shares are to be issued and repaid, and the manner in which shareholders are to be informed of changes in the terms on which their shares are held;

(d) whether any preferential or deferred shares are to be issued and, if so, within what limits and on what terms;

(e) the manner in which housing loans are to be made and repaid, and the conditions on which such a borrower can redeem the amount due from him before the end of the period for which such a loan was made;

(f) the arrangements for the custody of the mortgage deeds and other securities belonging to the society;

(g) the manner in which losses are to be ascertained and provided for;

(h) the powers and duties of the board of directors;

(i) the manner of appointing, remunerating (including pensions) and removing directors (including the filling of casual vacancies) and, where it is not to be fixed by resolution at the annual general meeting, the maximum amount of remuneration to be paid to directors;

(j) the manner of remunerating auditors;

(k) the form, and arrangements for the custody and use, of the seal of the society;

(l) the right of members to requisition meetings;

(m) the form of notice for the convening of a meeting and the manner of service of the notice;

(n) the right of members to move resolutions at meetings;

(o) the manner in which notice of any resolution (including a special resolution or a conversion resolution) to be moved at meetings is to be given to members;

(p) the procedure to be observed at meetings;

(q) the voting rights of members, the right of a member to demand a poll and the manner in which a poll is to be taken;

(r) the right of a member to appoint a proxy;

(s) whether disputes between the society and any of its members, or any person claiming by or through any member or under the rules, shall be settled by reference to the Circuit Court, arbitration or the Central Bank;

(t) the manner in which membership of the society is to cease;

(u) the right of members to participate in the distribution of any surplus assets after payments to creditors on the winding up or dissolution of the society; and

(v) the manner of appointing an independent person or persons, not being an officer or employee of the society, to supervise the conduct of a poll for the election of a director.

6. Nothing in this Schedule shall be taken to authorise any provision to be made in the memorandum or rules of a society which is inconsistent with this Act or regulations made thereunder or requirements of the Central Bank in the exercise of its functions under this Act or to affect the operation of any provision of this Act making rules void to any specified extent.

THIRD SCHEDULE

Supplementary provisions in relation to authorisation

Section 17 .

Applications

1. (1) An application for authorisation—

(a) shall be made in such manner as the Central Bank may specify, either generally or in any particular case; and

(b) shall be accompanied by such information as the Central Bank may require, either generally or in any particular case, in order to decide whether or not to grant authorisation and whether with or without conditions.

(2) If required to do so by notice from the Central Bank given at any time after an application for authorisation has been made and before a decision has been reached on the application, the applicant shall furnish to the Central Bank such additional information as it may require in order to decide on the application.

(3) If the Central Bank proposes to refuse to grant authorisation it shall serve a notice on the applicant stating—

(a) that it proposes to refuse to grant authorisation,

(b) the grounds for the proposed refusal, and

(c) that the applicant may make representations in writing to the Central Bank with respect to the proposed refusal within such period, not being less than 21 days after service of the notice, as is specified in the notice.

(4) If the grounds for the proposed refusal include the ground that any officer of the society is not a fit and proper person to hold office in the society, the Central Bank shall serve notice of that ground on that officer giving him the right to make representations with respect to his fitness and propriety for office within such period, not being less than 21 days after service of the notice, as is specified in the notice.

(5) The Central Bank shall, before reaching a decision on the application, consider any representations made to it under subparagraph (3) or (4).

(6) If, on an application for authorisation, the Central Bank refuses to grant authorisation, it shall serve on the society and on every officer of the society a notice stating the Central Bank's decision and the grounds for it and, subject to subparagraph (7), shall do so before the expiry of the period of 6 months beginning on the date on which the application was received.

(7) In any case where the Central Bank requires additional information with respect to an application, the latest time for the giving of a notice under subparagraph (6) with respect to the application shall be the expiry of whichever of the following periods first expires, namely—

(a) the period of 6 months beginning with the date on which the additional information is furnished to the Central Bank; or

(b) the period of 12 months beginning with the date on which the application was received by the Central Bank.

Imposing or amending conditions.

2. (1) If the Central Bank proposes to impose conditions on an authorisation or to amend or add to the conditions of an authorisation in a manner that would make them more onerous, it shall serve on the society and on every officer of the society, a notice stating—

(a) that the Central Bank proposes to impose conditions or to amend or add to the conditions of an authorisation;

(b) the proposed conditions, amendments or additions;

(c) the grounds for the proposal; and

(d) that the society may make representations in writing to the Central Bank with respect to the proposed imposition, amendment or addition within such period, not being less than 21 days after service of the notice, as may be specified in the notice.

(2) If any condition proposed to be imposed, amended or added includes a requirement for the removal from office of any officer of the society, the Central Bank shall serve notice of that proposal on that officer giving him the right to make representations with respect to the proposal within such period, not being less than 21 days after service of the notice, as is specified in the notice.

(3) The Central Bank shall, before reaching a decision on whether to impose, amend or add to conditions, consider any representations made to it under subparagraph (1) or (2).

(4) If the Central Bank decides to impose, amend or add to conditions it shall serve on the society and every officer of the society a notice stating—

(a) the conditions, and

(b) the grounds for its decision.

(5) Where the Central Bank, after considering any representations made to it under subparagraph (1) or (2), decides on an imposition, amendment or addition, as the case may be, that differs from that specified in the notice under subparagraph (1), it shall not be necessary to give a new notice under this paragraph if the difference results in the condition or conditions being no more onerous than would be the case if the Central Bank had proceeded in accordance with the original notice.

FOURTH SCHEDULE

Supplementary provisions in relation to revocation of an authorisation

Section 40 .

Revocation of authorisation.

1. (1) If the Bank proposes to revoke an authorisation (other than in pursuance of a request by the holder) it shall serve on the building society and on every officer a notice stating—

(a) that it proposes to revoke the authorisation,

(b) its grounds for the proposed revocation, and

(c) that the society may, within 21 days after the date of the giving of the notice, make representations in writing to the Central Bank in relation to the proposed revocation.

(2) If the grounds for the proposed revocation include the ground that any officer of the society is not a fit and proper person to hold office in the society, the Central Bank shall also serve notice of that ground on the officer concerned giving him the right to make representations with respect to his fitness and propriety for office within such period, not being less than 21 days after service of the notice, as is specified in the notice.

(3) The Central Bank shall, before deciding whether or not to revoke the authorisation, consider any representations made to it under subparagraph (1) or (2) in relation to the proposed revocation and shall serve on the society and on every officer a notice stating its decision and the grounds for it and the society may, within one month of receipt of the Bank's decision, appeal to the Court against it.

Provisions consequent on revocation.

2. (1) Where an authorisation is revoked and the society is not being wound up—

(a) the society shall continue to be subject to the duties and obligations imposed on it by or under this Act until all its liabilities in respect of shares and deposits have been discharged to the satisfaction of the Central Bank;

(b) the society shall, as soon as may be, notify all persons holding shares in or deposits with it and the Central Bank of the measures it is taking to discharge in full and without undue delay all its liabilities in respect of such shares and deposits; and

(c) the Central Bank may, if the society fails to notify it within a reasonable time in accordance with subparagraph (1) (b) or if it considers that the measures taken or proposed to be taken by the society to discharge its liabilities to shareholders and depositors are not satisfactory, give a direction prohibiting the society for such period, not exceeding 6 months, as may be specified in the direction, from—

(i) dealing with or disposing of any of its assets, or specified assets, in any manner,

(ii) engaging in any transaction or class of transaction or specified transaction, or

(iii) making payments,

without the prior authorisation of the Central Bank and may require it to prepare and submit to the Bank within 2 months of the direction, for its approval, a scheme for the orderly discharge in full of its liabilities to its shareholders and depositors.

(2) Where a direction to which subparagraph (1) relates is given the provisions of the Fifth Schedule shall apply with any necessary modifications.

(3) Subject to subparagraph (4), any obligation to make a payment to the society, which by virtue of section 17 , the society is prohibited from accepting, shall be wholly rescinded.

(4) If, when a society's authorisation is revoked, a member is under an obligation to make payments to the society which represent instalments of the amount due by way of subscription for a share in the society and which, by virtue of section 17 , the society is prohibited from accepting, the obligation shall (subject to anything in the rules of the society and any agreement between the society and the member) be suspended in respect of each instalment for the period during which no authorisation is in force; and accordingly if the society is subsequently granted authorisation the sum due shall again become payable by instalments.

(5) It shall be the duty of the society to make reasonable arrangements for using the funds of the society to meet applications by depositors with and shareholders in the society (being applications made in accordance with the rules of the society) for repayment of the money deposited or subscribed by them.

(6) A society whose authorisation has been revoked may apply to the Central Bank for a new authorisation in accordance with section 17 .

(7) The Central Bank shall note the revocation of the society's authorisation and the date it takes effect in the public file of the society and, as soon as may be after the revocation of an authorisation, publish notice of the revocation in such manner as it thinks fit.

(8) Where a society's authorisation is revoked and the society is being wound up, the liquidator, notwithstanding the revocation, may continue to carry on the business of the society and to hold himself out as a building society (with all the rights and obligations attached thereto) to such extent as the Central Bank (or the Court if the society is being wound up under the supervision of the Court) may consider necessary to enable him to discharge his functions.

FIFTH SCHEDULE

Supplementary provisions in relation to a direction by the Central Bank under

Section 40 .

Direction by Central Bank.

1. The Central Bank may revoke a direction given under section 40 (2) unless an order under paragraph 3 has been made by the Court in respect of the direction.

2. A building society to whom a direction has been given under section 40 (2) may apply to the Court for, and the Court may grant, an order setting aside the direction.

3. The Central Bank may apply to the Court for, and the Court may grant, an order confirming a direction or confirming it and, subject to paragraph 5, extending the period of its operation for such time, not exceeding the period of 12 months from the date the direction commenced to have effect, as the Court may, having regard to all the circumstances, consider appropriate.

4. In addition to or in lieu of an order under paragraph 3 the Court may make such other order in the case as may appear to it to be necessary, including an order directing any person who holds money or other assets for or on behalf of the society, or a specified person, not to dispose of any of those assets except on such conditions and in such circumstances as are specified in the order.

5. A direction which has been confirmed by the Court shall terminate—

(a) at the end of the period of operation specified by the Court,

(b) on the making by the Court of an order for termination on the application of the Central Bank,

(c) on the making of a winding up order in respect of the society, or

(d) on the making by the Court of an order for termination where the Court considers that the circumstances that gave rise to the direction have ceased to exist and that it would be unjust and inequitable not to make the order,

whichever first occurs.

6. If the Central Bank forms the opinion that the society to whom the direction was given is able to meet its obligations to its shareholders and creditors but the circumstances which gave rise to the direction are unlikely to be rectified, it shall forthwith apply to the Court for and the Court may grant an order directing the said society to prepare, in consultation with the Bank, a scheme for the orderly termination of its business and the discharge of its liabilities to its shareholders and depositors under the supervision of the Bank and to submit it to the Court within 2 months for approval.

7. The Court shall not approve the terms of a scheme under paragraph 6 without hearing the Central Bank and, in the event of dispute about terms of the scheme, the Bank or the society may apply to the Court to adjudicate on the matter.

8. If the society fails to comply with an order of the Court under paragraph 6 or fails to adhere to the scheme approved by the Court, the Central Bank may apply to the Court for and the Court may make such further order as it considers appropriate including an order of committal or for the winding up of the society on the ground that it is just and equitable that it be wound up.

9. The Court may by order revoke or amend an order (except an order under paragraph 5) made by it under this Schedule.

10. Where a direction is given by the Central Bank in accordance with section 40

(a) the society to whom the direction has been given shall take all necessary steps to secure that its assets wherever held, are not depleted without the prior authorisation of the Bank; and

(b) the Bank may direct a bank or any institution exempt under section 7 of the Act of 1971, which holds an account of the society to which the direction has been given, to suspend the making of payments from the account without the prior authorisation of the Bank.