Updates to the Irish Fitness and Probity Regime: What Firms Need to Know

What You Need to Know

The Central Bank of Ireland’s recent update consolidates and replaces prior Fitness and Probity guidance.

The new guidance provides clarity on areas including expectations on capacity/time, multiple and non‑resident Pre-Approval Controlled Functions (“PCF”), independence, experience benchmarks for boards and control functions, diversity and collective suitability and PSD2‑specific probity evidence.

Background

The Fitness and Probity Regime (the “F&P Regime”) was introduced by the Central Bank Reform Act 2010 (the “2010 Act”) and applies to regulated financial service providers (including credit unions) and holding companies established in Ireland (the “Firms”).

Since the introduction of the F&P Regime in 2011, the Central Bank of Ireland (the “Central Bank”) has provided detailed guidance on the Fitness and Probity Standards (“Standards”), setting out the Central Bank’s expectations on how Firms should comply with the requirements of the F&P Regime.

In November 2025, the Central Bank updated its Guidance on the Standards (the “Guidance”) replacing the previous December 2023 Central Bank Guidance (the “2023 Guidance”). In addition, the Central Bank’s Fitness and Probity Standards Code issued under Section 50 of the 2010 Act has also been revised.

Consolidation and Scope

The Guidance consolidates the existing 2023 Guidance on F&P Regulations¹ and Standards for Firms into one document, replacing the 2023 Guidance, the Guidance on Fitness and Probity for Credit Unions 2024 and the existing “Fitness and Probity – Frequently Asked Questions” for Firms and credit unions.

It details how other Central Bank requirements, such as the Corporate Governance Requirements for relevant regulated Firms and the Individual Accountability Framework, interlink with the F&P Regime. The Guidance provides welcome clarity on a number of specific areas where additional detail had been sought.

Key Takeaways

• Capacity and Time Commitments – The Guidance elevates time commitment as a core element of “capacity” within the fitness assessment. Firms should be able to demonstrate, using relevant anchors, that individuals have sufficient time for their roles, considering the Firm’s nature, scale and complexity, and other mandates held by the individual. The Central Bank points Firms to applicable sources, including the Corporate Governance Requirements, the Fund Management Companies – Guidance (which flags, as a risk indicator, a joint test of more than 20 directorships and an aggregate professional time commitment above 2,000 hours), the Credit Union Act, and ESA guidelines. Where sectoral requirements are silent, Firms should apply best practice consistent with these benchmarks and document their assessment in a way that can be shown to the Central Bank if asked.
• Multiple PCF Roles / Sharing / Location – The Central Bank confirms that holding more than one PCF can be permitted, provided the individual demonstrates competence, avoids conflicts and can meet the time commitment for each role. Approval is required in respect of each PCF role. By contrast, sharing a single PCF is not generally permitted, save for genuine job-share arrangements or where the role spans clearly distinct business lines. Otherwise, Firms should expect one PCF role holder per PCF. In addition, Firms should expect case-by-case assessment of non‑resident PCFs, with the Central Bank taking into account whether a dispersed PCF cohort can still meet accessibility expectations, and whether there is substantive presence in the State, including management of key risks and decision-making within the Irish entity rather than elsewhere in a group.
• Independence of Mind vs. being “Independent” – The Guidance draws an important distinction between independence of mind (expected of all directors) and being independent (relevant to specific roles such as independent non-executive directors (“INEDs”)).Independence of mind concerns behavioural competencies such as the strength to challenge, resist groupthink and exercise sound judgement; a person may meet structural independence criteria and still lack the behavioural independence required. Firms should consider both aspects when assessing suitability.
• Objective Criteria for Roles: Experience and Knowledge – To aid consistency, the Central Bank has introduced high-level expectations and tables of role profiles for board members and heads of control functions. While thresholds are applied proportionately, they provide a benchmark: for example, the Chair typically would be expected to have around ten years’ recent relevant experience in larger or more complex Firms (and eight years in smaller Firms), while an executive director would usually have five years’ recent experience in relevant senior roles (four years in smaller Firms). Similar expectations are set out for non-executive and INEDs, CEOs and sole traders/single directors. The Guidance also sets out expectations for Heads of Control Functions, including the Head of Actuarial Function, where specific minimum actuarial experience and professional standing are articulated. Firms may propose candidates with atypical profiles but should be able to justify suitability by reference to the specific responsibilities and context.
• Collective suitability, diversity and inclusion – The Guidance places renewed emphasis on collective board suitability, including having a sufficiently diverse mix of skills and perspectives to oversee the Firm effectively. Firms should understand their collective skills, identify gaps (for example, via a board skills matrix where applicable, or as good practice), and support diversity through inclusive practices. A gender-balanced composition is highlighted as particularly important, though the Central Bank views gender as one component within a broader conception of diversity.
• Temporary officer regime – The Guidance formalises a temporary officer pathway for vacant PCF roles, subject to prior written agreement from the Central Bank and a maximum six‑month duration. Where the vacancy is permanent, a PCF application must be submitted within three months of the temporary appointment. Consecutive or cumulative temporary appointments beyond six months will not be permitted except in exceptional circumstances and require formal engagement with the Central Bank. Temporary officers are CF‑1s and remain fully subject to the Standards and the Common and Additional Conduct Standards. Acceptance as a temporary officer does not prejudge suitability for permanent appointment.
• Due diligence – The Guidance sets out a structured approach to due diligence across fitness, probity and financial soundness. Firms should conduct and document role-appropriate checks, before appointment and on an ongoing basis, covering qualifications, experience, references, conflicts and concurrent responsibilities, and relevant MCC/CPD obligations where applicable. For probity, Firms should obtain signed declarations, conduct regulatory and director restriction checks, and assess any disclosed criminal, civil or regulatory actions. The Central Bank introduced a general ten‑year rule of thumb: where ten years have elapsed since a concluded adverse action and there are no aggravating circumstances, the individual is likely to meet the Standards—but aggravating factors can keep older matters relevant. Firms should take a holistic view, considering seriousness, relevance to the role, repetition, the individual’s explanation and learnings, and evidence of rehabilitation. In some cases, a series of minor issues may be significant in the aggregate.
• PSD2 – For payment and e‑money institutions and AISPs, PCF applicants must provide objective evidence of the absence of criminal convictions, investigations and proceedings. Irish residents satisfy this through Garda vetting managed by the Central Bank; non‑Irish residents may provide official police certificates or other objectively reliable sources, including lawyer testimony. Evidence is generally accepted if issued within six months. Prior assessments by relevant authorities should be evidenced with identity of the authority, date and outcome.

What Firms Should Do Now

Firms should review and, where necessary, update their F&P policies, procedures and records to reflect the clarified Guidance. This includes:

• Ensuring time commitment assessments are well‑evidenced and reference the relevant anchors and sectoral requirements or best practice.
• Testing the feasibility of multiple PCFs or non‑resident PCFs against time, conflict and accessibility expectations, and avoiding PCF role‑sharing unless the limited exceptions apply.
• Aligning board and control function appointments with the Guidance’s experience and knowledge expectations, or documenting clear, role‑specific justifications where deviating.
• Refreshing due diligence processes where required.

How we can help

We are seeing an increased focus from the Central Bank on conduct standards, individual accountability and fitness and probity expected from senior role holders in regulated firms.

Our dedicated Irish Financial Services Regulatory Group works on various matters relating to the Fitness and Probity regime including F&P assessments, policies and procedures, workplace investigations, reporting to the Central Bank, and guiding both firms and individuals through supervisory and contentious interactions with the Central Bank on matters relating to Fitness and Probity, and the Individual Accountability Framework.

Further information on our team and the services we provide is available on our website² and FSR³ and FinTech⁴ brochures. If you would like further information, please liaise with your usual Maples Group contact or the persons on this page.