Matheson

Dublin

Established in 1825 in Dublin, Ireland and with offices in Cork, London, New York, Palo Alto and San Francisco, more than 700 people work across Matheson’s six offices, including 96 partners and tax principals and over 470 legal and tax professionals. Matheson services the legal needs of internationally focused companies and financial institutions doing business in and from Ireland. Our clients include over half of the world’s 50 largest banks, 6 of the world’s 10 largest asset managers, 7 of the top 10 global technology brands and we have advised the majority of the Fortune 100.

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Updates

Competition & Antitrust

Higher financial thresholds for merger notifications
Ireland | 01 November 2018

Minister for Business, Enterprise and Innovation Heather Humphries recently laid the Competition Act 2002 (Section 27) Order 2018 before the Houses of the Oireachtais. This will have the effect of increasing the financial thresholds for M&A requiring a notification to the Competition and Consumer Protection Commission. This is the first time that a minister has used their powers under Section 27 of the Competition Acts from 2002 to 2017.

Higher merger control thresholds: welcome news for private equity
Ireland | 25 October 2018

The Department of Business, Enterprise and Innovation recently published legislation that substantially increases the financial thresholds at and above which notification of a transaction is required to the Competition and Consumer Protection Commission. From 1 January 2019, only mergers where the acquirer and target each generate €10 million or more and together generate €60 million or more turnover in Ireland will trigger mandatory notification.

CCPC serves up sharp reminder to Irish restaurant trade
Ireland | 23 August 2018

The Competition and Consumer Protection Commission's (CCPC's) current scrutiny of the Restaurants Association of Ireland serves as a reminder that trade associations must be careful to stay within the lines and avoid encouraging or inadvertently facilitating anti-competitive agreements between their members. Compliance training is an essential tool to prevent unwanted scrutiny from the CCPC and other authorities.

Non-compete clauses – staying within the boundaries
Ireland | 28 June 2018

Non-compete clauses can provide important protection for purchasers who have a legitimate interest in maintaining the value of the business they are acquiring. However, careful consideration must be given to the drafting of non-competes in order to avoid allegations of anti-competitive conduct – which is a criminal offence in Ireland – and scrutiny from competition regulators such as the Competition and Consumer Protection Commission and the European Commission.

Proposed legislation granting additional competition enforcement powers
Ireland | 07 June 2018

A new bill has been proposed in the Oireachtas to grant the Competition and Consumer Protection Commission (CCPC) civil enforcement powers. At present, where the CCPC identifies a suspected breach of competition law, it must petition the court to impose criminal penalties. Under the amendment bill, the CCPC would be empowered to levy administrative fines against firms or individuals for anti-competitive practices. This would bring Ireland into line with most other EU member states.

Gun jumping investigations: implications for the Competition and Consumer Protection Commission
Ireland | 10 May 2018

Ireland has recently shown an increased interest in gun jumping, the prohibited practice of implementing a transaction without having first obtained merger control clearance. In February 2018 the Competition and Consumer Protection Commission confirmed that it had launched an investigation into suspected gun jumping by Armalou Holdings Limited of Lillis O'Donnell Motor Company Limited.

Insurance

Are GDPR fines insurable in Ireland?
Ireland | 23 July 2019

The EU General Data Protection Regulation (GDPR) recently introduced a new regime of administrative fines for data protection infringements and provided for a tiered penalty structure based on the nature of the infringement. However, the insurability of GDPR fines remains a grey area and there is a large question mark over whether such fines will be insurable in Ireland where there is an element of moral turpitude in the infringement.

EU (Insurance Distribution) Regulations 2018: key changes for Ireland
Ireland | 30 April 2019

Minister for Finance and Public Expenditure and Reform Paschal Donohoe signed the EU (Insurance Distribution) Regulations 2018 (the IDD Regulations) into national law in June 2018. However, the implementation of the IDD Regulations was postponed until 1 October 2018 to provide the insurance industry with additional time to put in place the necessary organisational and technical changes required to ensure compliance. This article reviews the key changes resulting from the IDD Regulations.

Periodic payment orders in catastrophic injury cases
Ireland | 23 April 2019

A recently signed ministerial order marks the formal introduction of long-awaited periodic payment orders (PPOs) in Ireland. This should be a welcome development for insurers as it will avoid upfront compensation payments in catastrophic injury cases. It will also align the Irish regime of awards in case of catastrophic injury with the UK system, under which PPOs are already available.

Clarity for insurers seeking to join proceedings
Ireland | 16 April 2019

The April 2018 decision of Bin Sun v Jason Price provides a useful summary of the circumstances in which a party can be joined as a co-defendant against the wishes of a plaintiff. It also provides clarity for insurers as to the circumstances in which they can seek to be joined to proceedings at first instance, which could prevent or substantially reduce their exposure in a subsequent application by a claimant to enforce against them.

Impact of Brexit for Irish policyholders
Ireland | 26 March 2019

Large corporates based in Ireland typically have a suite of non-life insurance policies to cover a variety of risks. Given the fact that the UK insurance market is the biggest in the European Union, it is likely that at least some of the policies held by corporates based in Ireland will have been written by UK or Gibraltar-licensed insurers. As such, whatever form Brexit ultimately takes, Irish policyholders with policies written by UK insurers must assess any risk to (among other things) their ability to renew.

Supreme Court decision puts after-the-event insurance under spotlight
Ireland | 10 October 2017

A recent Supreme Court decision confirming that third-party litigation funding in return for a share of the proceeds is unlawful in Ireland has put after-the-event (ATE) insurance back in the spotlight as the only legitimate alternative method of funding litigation. Although a relatively new insurance product, a number of insurers are now providing ATE insurance in Ireland.

Minimum Competency Code to incorporate implementation of EU Insurance Distribution Directive
Ireland | 19 September 2017

The Minimum Competency Code 2017 has been introduced to incorporate the implementation of the EU Insurance Distribution Directive, the EU Markets in Financial Instruments Directive II and associated European Securities and Markets Authority guidelines and the European Regulations 2016. The main changes under the code relate to the qualification and experience requirements of the staff of financial services providers.

Fasten your seat belts: driverless cars to rev up insurance industry
Ireland | 13 June 2017

The existing legislative and regulatory framework for motor insurance in Ireland is driver-centric and needs to adapt for the era of autonomous vehicles. At present, driving is defined as 'managing and controlling' a vehicle. This is not appropriate for autonomous vehicles, where the technology and not the driver controls the vehicle. The legal landscape must keep pace with this cutting-edge technology and efforts must be made now to consider how best to address the various issues which will arise.

Consumer Insurance Contracts Bill 2017
Ireland | 21 February 2017

The Consumer Insurance Contracts Bill 2017 recently passed the second stage in the Dáil (the lower house of Parliament) and will now proceed to the committee stage. The bill will apply to consumer insurance contracts only. It will replace the existing duty of disclosure with a statutory duty to answer specific questions carefully and honestly and will allow the insured to claim damages for late payment of claims by insurers. At present, there is no timeline for implementation.

Avoidance of life assurance policy for non-disclosure of material facts
Ireland | 20 December 2016

The High Court recently upheld a finding of the Financial Services Ombudsman that an insurer was entitled to avoid a life assurance policy on the grounds of non-disclosure. Significantly, the decision turned on the strength of the proposal form and serves as a useful reminder to insurers of the importance of a well-drafted proposal form.

Outsourcing under EU Solvency II regime
Ireland | 21 June 2016

The EU Solvency II Directive was transposed into domestic Irish law by the European Union (Insurance and Reinsurance) Regulations. The Solvency II regime provides welcome clarity regarding the functions that an insurer may outsource and the requirements which must be complied with before outsourcing. This is particularly welcome news for captive insurers which tend to rely heavily on outsource service providers.

Solicitors' professional indemnity insurance regulations do not create third-party rights
Ireland | 08 March 2016

The High Court recently confirmed that third-party rights against insurers in Ireland are restricted, providing comfort for insurers in the context of solicitors' professional indemnity insurance. The decision is consistent with recent confirmation from the authorities that third parties have no direct right of action against insurers. To the extent that a specific statutory provision permits a restricted right of action, the insured defendant's liability must be established in the first instance.

Court of Appeal upholds High Court decision regarding real rate of return
Ireland | 23 February 2016

The Court of Appeal recently ruled in a case which considered the 'real rate of return' discount which would be applied to an injured plaintiff's future care costs. When quantifying future losses in personal injury actions, future care costs may now be discounted by only 1% and as a result underwriters will be ordered to pay out higher lump-sum damages awards. There is likely to be a knock-on effect which will see underwriters increasing premiums.

Fitness and Probity Regime for (re)insurance undertakings
Ireland | 09 February 2016

The Central Bank of Ireland's Fitness and Probity Regime has been reviewed to determine its compatibility with the EU Solvency II Directive. A number of amendments are set to be made to the regime for all (re)insurance undertakings, including changes to key function holders, outsourcing key functions, the head of the actuarial function and the removal of the chief actuary and signing actuary.

Irish insurance market to be affected by upcoming UK reform
Ireland | 02 February 2016

The Law Reform Commission of Ireland recently published its draft Consumer Insurance Contracts Bill 2015. Unlike the UK Insurance Act, the commission's bill applies only to consumer insurance contracts. While the changes proposed in the bill are not generally as wide-reaching as those to be implemented by the UK act, there are some similarities, including changes to the duty of disclosure and proportionate remedies for non-disclosure.

Solvency II Directive transposed into Irish law
Ireland | 26 January 2016

The European Union (Insurance and Reinsurance) Regulations 2015 were recently signed by the minister for finance, transposing the EU Solvency II Directive into Irish law. The regulations establish new capital requirements, valuation techniques and governance and reporting standards. They also provide the Central Bank of Ireland with increased supervisory responsibilities.

Periodic payment orders on horizon for catastrophically injured plaintiffs
Ireland | 03 November 2015

The General Scheme of the Civil Liability (Amendment) Bill provides that a court awarding damages for future monetary loss in respect of catastrophic injury may order that all or part of the damages be paid as periodic payments where it is in the best interests of the plaintiff. The use of a periodic payment order is intended to transfer risk from the plaintiff to the insurer. However, the plaintiff will bear the risk that the insurer could become insolvent.

High Court confirms that third-party rights against insurers are restricted
Ireland | 27 October 2015

The recent High Court decision in Michael Murphy v Allianz Plc provides further clarification of the scope of Section 62 of the Civil Liability Act 1961 – in particular, the conditions which must be satisfied for its application. The decision will be welcomed by insurers, as it confirms yet again that the Irish courts will require strict compliance where an injured third party seeks to rely on Section 62.

FSO erred in upholding avoidance of home insurance policy for material non-disclosure
Ireland | 20 October 2015

The High Court recently considered whether the Financial Services Ombudsman (FSO) had erred in law in determining that an insurer was entitled to void a home insurance policy for material non-disclosure. The court noted that the case concerned a consumer contract and thus all comments and findings of the court were made exclusively in that context. The court concluded that the deputy FSO had erred in law on at least five grounds.

Proposed reform of consumer insurance contracts
Ireland | 13 October 2015

The Law Reform Commission has published its long-awaited report on consumer insurance contracts. The report makes 105 recommendations for reforms to the rules. According to the commission, the existing rules do not reflect the realities of the bargaining powers of consumers compared to large insurers. If adopted, insurers will have to redraft their consumer insurance policies.

Insurer to prove alleged non-disclosure by oral evidence
Ireland | 04 August 2015

The High Court recently refused an application by an insurer for leave to deliver interrogatories, finding that the alleged material non-disclosure must be proved by oral evidence at trial. The insurer had obtained extensive discovery of the deceased's medical records, enabling it to phrase the interrogatories with precision. However, the court concluded that the plaintiffs should have the opportunity to cross-examine the defendant's witnesses.

Serious illness cover misunderstood, but not mis-sold
Ireland | 28 July 2015

In a recent case, a couple's claim for rheumatoid arthritis was refused by the insurer because the policy did not include serious illness cover. The appellant complained to the Financial Services Ombudsman (FSO) on the basis that she and her husband believed that they were covered for all manner of serious illnesses under the policy, rather than only certain specified illnesses. The FSO found that the complaint was unsubstantiated.

Insurers entitled to rely on additional reasons post-declinature
Ireland | 14 July 2015

The High Court recently confirmed that insurers will not be limited to the initial reasons listed for declinature and may rely on misrepresentations made subsequently by an insured. The court found that a misrepresentation by an insured can be taken into consideration by the court, even if it arises subsequent to the initial claim being made and its initial refusal.

After-the-event insurance given amber light
Ireland | 16 June 2015

The Court of Appeal recently overturned a High Court ruling that the insolvent plaintiff's after-the-event (ATE) insurance could effectively substitute security for costs. The court accepted that an ATE insurance policy could provide security for costs in principle. However, it did not accept that the policy in question provided sufficient security. The decision was influenced by the existence of a condition precedent.

Majority of insurance complaints to Financial Services Ombudsman not upheld
Ireland | 12 May 2015

The latest Financial Services Ombudsman annual review has revealed that insurance complaints represented 44% of all consumer complaints filed in 2014. However, it is significant that 80% of these were not substantiated. Payment protection insurance continued to be a significant source of complaints.

After-the-event insurance passes champerty and maintenance test
Ireland | 09 September 2014

The High Court recently upheld the validity of an after-the-event insurance policy and expressly confirmed that after-the-event insurance does not fall foul of the tort of maintenance or champerty. The court held that the rules against maintenance and champerty remain applicable in an Irish context and after-the-event policies must comply with these rules in order to be valid and enforceable.

Payment protection insurance remains in spotlight
Ireland | 26 August 2014

In 2012 the Central Bank of Ireland undertook a widespread review of PPI sales, which resulted in refunds of €67.4 million. To date, both the Financial Services Ombudsman and the Irish courts have largely found in favour of credit institutions and ruled that PPI was not mis-sold to policyholders. However, this has not discouraged claimants and challenges to PPI sales persist.

Financial Services Ombudsman reports on insurance complaints trends in 2013
Ireland | 08 April 2014

Fifty percent of complaints made to the Financial Services Ombudsman (FSO) in 2013 related to insurance. For the first time since 2007, there has been a significant decrease in the number of complaints made, although complaints requiring formal investigation have increased. The FSO welcomed the reduction in complaints but highlighted that payment protection insurance continues to be a concern.

Revised Corporate Governance Code for Credit Institutions and Insurance Undertakings
Ireland | 08 April 2014

The Central Bank recently published a revised Corporate Governance Code for Credit Institutions and Insurance Undertakings. The revised code will apply to all credit institutions and insurance undertakings (including reinsurers, but excluding captives) licenced or authorised by the Central Bank. It imposes minimum statutory requirements on how these undertakings should organise the governance of their institutions.

Investment structured as life assurance contract – does utmost good faith apply?
Ireland | 21 January 2014

In a recent High Court case a retired insurance broker had invested in a property-based fund which was unsuccessful because another development had attracted tenants away. The appellant argued that had he known all the facts, he would never have invested. The court concluded that the contract was not one of assurance but one of investment, and the principle of utmost good faith did not apply.

Proposed changes to Corporate Governance Code
Ireland | 20 August 2013

The Central Bank published a consultation on the review of the Corporate Governance Code for Credit Institutions and Insurance Undertakings. Proposed amendments include prohibiting the chairman or chief executive officer (CEO) from holding more than one chairman or CEO position in another credit institution or insurance undertaking at any one time.

High Court confirms documents prepared in coverage investigation are privileged
Ireland | 13 August 2013

The High Court recently found that it was unnecessary to provide documents prepared in anticipation of repudiation of a life insurance policy, as the documents were protected by litigation privilege. Litigation privilege protects confidential documents assembled with the purpose of preparing for a litigation. Insurers should keep in mind that they may wish to claim privilege over confidential documentation prepared during an investigation.

Scope of third party rights against insurers clarified by High Court
Ireland | 14 May 2013

Two recent High Court decisions have provided much-needed clarification as to the scope and operation of Section 62 of the Civil Liability Act 1961. The decisions related to applications by insurers to strike out the claim against them on the basis that no reasonable cause of action was disclosed. Both insurers were successful.

Can after-the-event insurance substitute security for costs?
Ireland | 30 April 2013

The High Court recently had its first opportunity to consider whether after-the-event insurance policies could effectively substitute security for costs. The ruling demonstrates that the courts will accept after-the-event insurance and will not award security for costs against a plaintiff that has taken out after-the-event cover, provided that policies do not contain terms by which the insurer can avoid liability to pay the defendant's costs.

International Trade

European Commission issues notice on recovery of unlawful and incompatible state aid
European Union | 04 October 2019

The European Commission recently published a new notice on the implementation of its decisions ordering the recovery of state aid. The recovery notice is far more detailed than the 2007 notice which it replaces and reflects recent developments in European Commission practice, including by providing more detail on tax state aid cases. For example, the notice provides new detailed guidance on issues such as the quantification of the state aid to be recovered.

Litigation

Recent rulings on state aid
Ireland | 08 October 2019

Two recent Irish court rulings have helped to shed light on the role of the national courts in state aid cases. These cases are particularly relevant as the role of the courts is likely to continue to grow in importance for Irish clients in the coming years. In the first, the Supreme Court strongly affirmed the Circuit Court's jurisdiction to hear state aid allegations. In the second, the High Court determined that examinership does not trump a state aid decision from the European Commission ordering recovery.

European Commission issues study on enforcement of state aid rules and decisions by national courts
European Union | 08 October 2019

The European Commission recently published a study which identifies the emerging trends and best practices with regard to the national courts' enforcement of state aid law across the European Union. In terms of trends, the study highlights that national courts rarely conclude that unlawful state aid has been granted (by their national authorities) and hence have rarely awarded remedies in favour of complainants that allege that state aid has been granted. This trend is particularly evident in relation to damages claims.