Updated Guidance on SPE Reporting to the Central Bank of Ireland

PUBLISHED: 10th March 2020

How determining whether your company is an SPE?

Both Irish-resident (i) securitisation vehicles (FVCs) and (ii) Section 110 companies (SPVs) (together referred to as special purpose entities (SPEs)) are required to report data quarterly on their assets and liabilities to the Central Bank of Ireland (Central Bank).  On 5 March 2020, the Central Bank published updated guidance on SPE reporting requirements.

The Central Bank’s updated guidance can be found as follows:

1. SPE Registration – FAQs
2. SPE Registration Form Guidance Notes
3. SPE Quarterly Reporting Notes on Compilation

The primary update is additional guidance on how to determine whether your company is an SPE. There are also some technical changes to how the SPE’s data is reported.

Are you an FVC?

Irish-resident companies with securitisation activities accounting for more than 50% of their balance sheet are required to report as FVCs. The Central Bank’s SPE Registration – FAQs define “securitisation” as:

“a transaction or scheme whereby an entity that is separate from the originator, or insurance or reinsurance undertaking, and is created for or serves the purpose of the transaction or scheme, issues financing instruments to investors, and one or more of the following takes place:

• An asset or pool of assets, or part thereof, is transferred to an entity that is separate from the originator and is created for or serves the purpose of the transaction or scheme, either by the transfer of legal title or beneficial interest of those assets from the originator or through sub-participation;
• The credit risk of an asset or pool of assets, or part thereof, is transferred through the use of credit derivatives, guarantees or any similar mechanism to the investors in the financing instruments issued by an entity that is separate from the originator and is created for or serves the purpose of the transaction or scheme;
• Insurance risks are transferred from an insurance or reinsurance undertaking to a separate entity that is created for or serves the purpose of the transaction or scheme, whereby the entity fully funds its exposure to such risks through the issuance of financing instruments, and the repayment rights of the investors in those financing instruments are subordinated to the reinsurance obligations of the entity.”

Are you an SPV?

All companies that are availing of the special tax treatment as “qualifying companies” under Section 110 of the Taxes Consolidation Act 1997 (as amended) are required to report subject to the following exceptions:

• Companies reporting as FVCs are not required to report as SPVs.
• Non-Irish domiciled companies are not required to report.
• Companies which have already been liquidated are not required to report (subject to the submission of a final return showing the assets winding down).
• Companies that have disposed of their assets with no future plans to acquire assets or undertake transactions are not required to report.

If you are unsure of your reporting obligations to the Central Bank, our experienced Financial Services structured solutions group is on hand to provide advice and assistance.