These FAQs relate to the Industry Funding Levy. Explanations of terms in italics can be found in the glossary at the end of this page.
What is the Industry Funding Levy?
Under to Section 32D of the Central Bank Act 1942 (as amended) the Commission of the Central Bank of Ireland ('the Bank') may, with the approval of the Minister for Finance, make Regulations requiring regulated entities to pay a levy to the Bank.
The objective of these Regulations is to raise approximately 50 per cent of the budget attributable to the Bank's financial regulation activities directly from the financial service providers it regulates. The balance is funded by the Central Bank by means of a subvention. The Regulations apply to all entities that are subject to regulation by the Bank.
For further details please see the Guide to Industry Funding Regulations 2013.
Why am I required to pay the Industry Funding Levy?
All regulated entities holding an authorisation as at 31 December 2012 are required to contribute towards the cost of financial regulation activities by paying the 2013 Industry Funding levy to the Bank.
How much do I have to pay?
The 2013 levy for each industry funding category is set out in the Guide to Industry Funding Regulations 2013 and in the Levy Rates pages of our website. Using these details, each firm will be able to calculate the amount of its 2013 levy based on its industry funding category, impact category and in the case of certain low impact firms, its impact score.
An entity that holds an authorisation in more than one category must pay the levy for each category. For example, a credit union (Category F) may also hold an authorisation as an intermediary (Category C) in which case it will be required to pay the appropriate levy in respect of both categories.
I have heard that the levies payable by certain low impact firms are tiered. What does this mean?
To address concerns expressed during the consultation process that the introduction of a single flat rate levy for low impact firms in certain industry funding categories which failed to take account of size, volume of business and/or ability to pay would lead to a regressive levy, the Bank decided to tier the amount of the levy payable by such firms in the Intermediaries, Moneylenders and Payment Institutions categories based on their impact score. This means that those firms with the lowest impact scores within a particular industry funding category will be liable to the smallest levies while those with the highest impact scores will pay significantly more.
This approach also recognises the fact that our engagement tasks and specified resource levels are not as defined for the low impact category as they are for other categories.
In which Industry Funding Category am I included?
The industry funding category in which a firm is included will depend upon the financial activities in respect of which it holds an authorisation from the Bank. A full list of industry funding categories is set out in the Levying Process section as well as in the Guide to Industry Funding Regulations 2013.
How is the new levy calculated?
A consultation paper was published on 22 November 2012 in which the Bank outlined its proposals regarding a revised basis for the calculation of the Industry Funding Levy. Following closure of the consultation period at the end of February this year, detailed consideration was given to each of the submissions received.
Details of the changes to be implemented to the levy calculation process are contained within the Feedback Statement on the Consultation Process for CP61. Essentially, however, the Bank is seeking to more closely align the funding, by regulated entities, of the costs of financial regulation on a basis consistent with its deployment of supervisory resources. What this means in practice is that the amount of the levy payable by a regulated entity will be determined according to its impact categorisation since this determines the supervisory engagement model (and hence the level of supervisory resources) allocated to the supervision of that entity. It follows that high impact entities will be liable to levies significantly in excess of the levies payable by low impact entities.
Under the revised levy calculation process the amount of the levy payable by a regulated entity will be established with reference to
- the type of authorisation that the firm holds (since this will position the firm in the relevant industry funding category);
- the proportion of the year in respect of which it held that authorisation;
- the firm's impact categorisation under PRISM; and
- in the case of certain low impact firms, the firm's impact score.
Details of the 2013 levy rates can be found in the Guide to Industry Funding Regulations 2013 and in the Industry Funding Levy Rates section. The position in relation to low impact firms is outlined below.
I was authorised for the first time this year. Am I required to pay the Industry Funding Levy?
Each financial service provider which holds an authorisation from the Bank for part or all of the year will be liable to a levy for the portion of the year in respect of which it held this authorisation. It follows that financial service providers newly authorised will be liable to a levy covering the period from date of authorisation to 31 December.
My authorisation was revoked this year. Do I have to pay the Industry Funding Levy?
Each financial service provider which held an authorisation from the Bank for part of, or all of the year will be liable to a levy for the portion of the year in respect of which it held this authorisation. It follows that financial service providers whose authorisation is revoked during the course of the year will be liable to a levy covering the period from 1 January to the date on which the authorisation was revoked.
I have not received an Industry Funding Levy Invoice. How do I get one?
Financial service providers who have not received an Industry Funding Levy invoice are still liable to pay the relevant levy. Please e-mail us at firstname.lastname@example.org if you are still authorised but have not received your levy invoice.
How can I pay my Industry Funding Levy?
Financial service providers can pay their levy by
- Electronic Funds Transfer,
- Direct Debit; or
More information on payment methods can be found in the Payment Options document.
What details do I need to pay my levy by Electronic Funds Transfer?
To ensure payments are dealt with efficiently, a payment reference must be included in the Text Field (Field 72) and must include at least one of the following details: account number and/or levy invoice number. Failure to include the required details may result in the payment being returned at the remitters expense and the levy remaining due.
Payment details are as follows:
Bank of Ireland
| Account Details
| Sort Code
| Account Number
|| IE48 BOFI 9000 1713 7868 15
| Bank Identifier Code
Why should I complete the direct debit mandate? I do not feel comfortable signing a direct debit without knowing how much I have to pay?
Payment by direct debit is the most efficient means of collecting the levy from the large number of firms regulated by the Central Bank. It is also a convenient way to pay and ensures that your levy is paid on time. You will receive a levy notice at least 28 days in advance of the payment by direct debit and therefore will know in advance the amount due from by firm in the current levy year. Payment by direct debit is not currently mandatory and the levy can be paid by alternative means.
What do I have to do to pay my Industry Funding Levy by direct debit?
If you wish to pay your annual Industry Funding Levy by direct debit please print and complete a copy of the SEPA Direct Debit mandate and return to the following address:
Financial Control & Procurement Division
PO Box 9708
Do I have a direct debit mandate in place?
Please e-mail us at email@example.com if you want to check whether you have already completed and submitted a SEPA Direct Debit mandate.
I want to appeal payment of the 2013 levy. How can I do this?
A financial service provider may appeal the levy amount to the Deputy Governor (Financial Regulation) to change the amount of the levy where it considers that the amount is incorrectly assessed but must do so no later than 21 days following the date of the levy notice. A financial services provider may only dispute the amount of assessment. A financial services provider cannot dispute an amount correctly calculated from the Schedule to the Regulations.
Any such appeals must be in writing and must:
- dispute the calculation of the levy because of either (a) an incorrect figure, or (b) an incorrect category or categories;
- set out the grounds of the appeal in detail;
- be accompanied by the amount of required levy contribution that is not in dispute; and
- include any supporting documentation or representations, where relevant.
Once an appeal has been considered and the financial services provider has been notified of the decision, it must pay the balance of the levy owing (if any) within 10 days of the date of notification. If a financial services provider fails to pay the levy by the required date the Bank may take steps to recover the amount of the levy. Recovery action may include court proceedings.
Can I appeal my impact categorisation and/or impact score?
It should be noted that since the determination of a firm's impact categorisation and calculation of its impact score is based on an objective model and impact metric data reported by the firm itself, neither the firm's impact categorisation nor its impact score are subject to appeal by the regulated entity concerned.
I do not understand some of the terms used in relation to the Levy.
A glossary has been included as Appendix 4 in the 2013 Guide to Industry Funding Regulations.
An explanation of some of the more common terms used has, however, been set out below:
Gross Annual Funding Requirement represents the proportion (approximately 50 per cent) of the budget for financial regulation activities for the year in question which will be funded by industry. For further details please refer to the Guide to Industry Funding Regulations 2013.
Net Annual Funding Requirement represents the adjustment of the Gross Annual Funding Requirement for the amount of any under/over recovery of the costs of financial regulation in the prior year.
Impact Category is derived from the Bank's Probability Risk Impact System (PRISM) for the 2013 funding year. It reflects the Central Bank's assessment of the potential impact of the failure of a regulated entity on financial stability and consumers.
PRISM (Probability Risk and Impact SysteM) is the name given to the framework that the Bank has developed to apply risk based supervision.
Impact metric data means selected items extracted from a regulated entity's most up to date On-Line Regulatory Return.
On-Line Regulatory Return (ONR) is the regulatory return that must be completed and submitted to the Bank by certain types of regulated entities by means of a secure web based system. The amount and type of information that the Bank requires to be included in the returns varies between financial sectors. Full details of the sectoral requirements are available in the reporting requirements section of the Financial Regulation Industry Sectors.
Impact Score is derived from the Bank's Probability Risk and Impact System (PRISM) for the 2013 funding year. It represents a numeric evaluation of a regulated entity's potential impact calculated by combining impact metric data.
Ultra High impact firms are the largest domestic firms or international firms with Irish headquarters and with potential to cause large scale damage to the financial system and the Irish economy.
High impact firms are large domestic and international financial firms with considerable potential to cause large-scale damage to financial sector stability.
Medium-High impact firms are large firms with considerable potential to cause harm or customer loss. They are, however, not systemically important institutions but firms whose failure (if managed properly) should not derail the financial system or wider economy.
Medium-Low impact firms are typically medium-sized and non-dominant players in their respective industries.
Low impact firms tend to have impact scores lower than 200. These constitute the bulk of the regulated firms operating in Ireland. Failure of individual firms in this category would not cause significant damage to the State or its citizens as a whole.
Why have I received a default levy of €3,600?
Default levies of €3,600 are issued to regulated entities where our records indicate that it has failed to complete an On-Line Regulatory Return (ONR). In such circumstances the firm will be liable to a default levy amounting to €3,600. The firm is therefore encouraged to complete its ONR as soon as possible as this will facilitate the determination of the appropriate levy amount - which will, in almost all instances, be significantly lower than the amount of the default levy. This new levy amount will replace the default levy. Further information on the ONR system and requirements can be found in the On-Line Annual Return section of our website.
Is this levy linked to the levies payable to the Investor Compensation Company Limited, the Financial Services Ombudsman or the National Consumer Agency?
No. The Industry Funding Levy which is payable to the Bank on an annual basis is designed to raise approximately 50 per cent of the budget attributed to the Bank's financial regulation activities directly from the financial service providers it regulates.
These questions do not deal with my queries. What can I do?
Please send an email to firstname.lastname@example.org with any other queries.