1.1 Regulatory Enforcement and Corporate Offences
In 2016, the Commission published its Issues Paper on Regulatory Enforcement and Corporate Offences (LRC IP 8-2016) (4th Programme of Law Reform, Project 1). The Paper addresses 12 issues concerning two related areas. The first area (involving Issues 1 to 6 in the Issues Paper) deals with whether the supervisory and enforcement powers of the State's main financial and economic regulators (such as the Central Bank, ComReg, the Competition and Consumer Protection Commission and the Director of Corporate Enforcement) are adequate or need to be supplemented by, for example, civil financial sanctions and more effective co-ordination between such regulators. The second area (involving Issues 7 to 12 in the Issues Paper) deals with whether there are gaps in the criminal law, particularly in relation to fraud, that need to be filled in order to respond more effectively to serious wrongdoing by corporate bodies, and whether there is a case for introducing an offence of reckless trading.
Issue 1 considers the supervisory and enforcement powers of financial and economic regulators, and asks whether – and if so, how – a standard set of powers should be created for some or all such regulators.
Issue 2 examines the power that some financial and economic regulators have to impose civil financial sanctions as a response to non-compliance with the law and as an alternative to criminal prosecution; and whether civil financial sanctions should be more widely available to regulators as an enforcement tool.
Issue 3 examines the use of negotiated compliance agreements, which are also available to some regulators, by which civil litigation by the regulator (or a criminal prosecution for non-compliance with the law, usually involving a minor infringement) can be avoided if a corporate body agrees to specific terms, including preventative measures to ensure future compliance.
Issue 4 examines deferred prosecution agreements (DPAs), which are widely used in the United States, and a judicially-supervised version of which was introduced in the UK in 2013. The Cartel Immunity Programme operated jointly by the Competition and Consumer Protection Commission and the Director of Public Prosecutions under competition law has some of the features of DPAs. The Issues Paper asks whether DPAs should be available in other contexts, and if so what oversight protections should be put in place.
Issue 5 examines matters concerning co-ordination and co-operation between regulators, notably where their statutory functions overlap. The Issues Paper asks what improvements can be put in place to ensure the efficiency and effectiveness of concurrent or overlapping jurisdictions between financial and economic regulators, including the form that co-operation agreements take; whether there should be a lead agency in such cases; the extent to which information should be shared between regulators; and how inspectors from different regulators might co-ordinate their enforcement activities.
Issue 6 considers possible reforms to improve the efficiency and effectiveness of the appeals process from financial and economic regulators, focusing on adjudicative decisions of regulators that can have a high market impact. This includes decisions to grant or remove a licence, or authorisation, of a regulated entity to operate in a regulated sector, or to impose civil financial sanctions. The Issues Paper asks whether a single appeals process, such as to the Commercial Court in the High Court, would be suitable for this purpose, or whether specialised appeals bodies should continue to have a role.
Issue 7 considers the general test for determining or attributing the criminal liability of corporate bodies. The Issues Paper explores whether existing tests are adequate and asks whether a generally applicable test based primarily on an organisational approach to corporate decision-making – which also takes account of the acts of senior corporate decision-makers – should be adopted, and if so what form that should take.
Issue 8 considers the related question of the two main models for determining the personal criminal liability of senior corporate decision-makers – the more widely-applicable model based on a test of the “consent, connivance or neglect” of the decision-maker, and the second, found in the Companies Act 2014, of the “officer in default.” The Issues Paper asks whether either or both of these models should be adjusted (for example, whether the “consent, connivance or neglect” formula should relate to the substantive offence to which it refers) and whether there is a case for a single test.
Issue 9 examines whether there should be a general defence of due diligence or “reasonable precautions” available to corporate criminal offences, or whether some offences should, on public policy grounds, remain absolute in nature. The Issues Paper asks whether obtaining professional advice, including legal advice, should be taken into account in determining whether a corporate body or its decision-makers have exercised due diligence.
Issue 10 examines whether there is a gap in the law on fraud offences. The discussion covers the common law offence of conspiracy to defraud and the fraud-related offences in the Criminal Justice (Theft and Fraud Offences) Act 2001 and the Companies Act 2014. The Issues Paper asks in this respect whether there is a need to enact offences along the lines of US mail fraud and wire fraud offences.
Issue 11 examines whether an offence of reckless trading should be enacted. Such an offence would criminalise corporate activity that involves reckless disregard as to whether the activity causes a loss. It would impose a lower threshold than applies to fraud-related offences, which require actual knowledge and intention to defraud.
Issue 12 examines the current legislation on the allocation of the court of trial for corporate offences. Where a corporate criminal offence requires a jury trial, most trials must be held in the Circuit Criminal Court, though some competition law jury trials are reserved for the Central Criminal Court (the High Court). The Issues Paper asks whether there should be more flexibility for the transfer of these trials between the Circuit Criminal Court and the Central Criminal Court, for example where a case is complex or concerns alleged systemic economic damage.
1.2 Contempt of court and other offences and torts involving the administration of justice
In 2016, the Commission published its Issues Paper on Contempt of Court and Other Offences and Torts Involving the Administration of Justice (LRC IP 10-2016) (4th Programme of Law Reform, Project 4).
The issues paper examines offences involving the administration of justice, including the law of contempt of court, and takes account of recent developments in this area since the publication of the Commission’s 1994 Report on Contempt of Court (LRC 47-1994), which recommended that the common law rules on criminal contempt and civil contempt should be replaced with statutory provisions.
The issues paper also looks at the legal problems that can arise for journalists if they are asked to reveal the sources of their published material given that refusal by a witness in a court case to answer a relevant question can constitute contempt of court. The European Court of Human Rights decision in 1996 in Goodwin v United Kingdom case that an order requiring the disclosure of a source could only be justified under the European Convention on Human Rights by “an overriding requirement in the public interest.” has been considered by the courts in Ireland on a number of occasions, but the law on disclosure of journalists sources remains unclear. The Issues Paper asks to what extent this could be clarified.
Finally, the issues paper also examines related offences and torts involving the administration of justice, including embracery (influencing or attempting to influence a juror), champerty (which involves a third party supporting litigation without just cause) and maintenance (where a third party supports litigation without just cause in return for a share of the proceeds). It asks whether it is appropriate to retain these crimes and torts and whether there is a case for their regulation.
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