Communications Regulation and Digital Hub Development Agency (Amendment) Act 2023

Chapter 5

Imposition of administrative sanctions

Requirement to pay financial penalty

94. (1) When determining the amount of a financial penalty, an adjudicator shall have regard to—

(a) the need to ensure that the financial penalty is—

(i) appropriate,

(ii) effective,

(iii) proportionate to the regulatory breach, and

(iv) dissuasive (including whether it will act as a sufficient deterrent to ensure that any similar regulatory breach will not occur in the future),

(b) the seriousness of the regulatory breach,

(c) in the case of breach by—

(i) a person that is not a natural person, the turnover of the person in the State in the financial year ending in the year immediately before the financial year in which the regulatory breach last occurred, or

(ii) a natural person, the annual income of the person on whom the financial penalty is to be imposed, in the year preceding the year in which the regulatory breach last occurred,

(d) the extent of any failure by the person to cooperate with the investigation concerned, whether or not such failure is prosecuted,

(e) any excuse or explanation offered by the person for the regulatory breach or failure to cooperate with the investigation concerned,

(f) any gain (financial or otherwise) made, or loss avoided, by the person, or by any other person in which the first-named person has a financial interest, as a consequence of the regulatory breach,

(g) the amount of any loss suffered, or costs incurred, by any person as a result of the regulatory breach,

(h) the effect of the regulatory breach on other operators, consumers and other end-users,

(i) the duration of the regulatory breach,

(j) the number of times the regulatory breach has occurred,

(k) whether or not the regulatory breach continued after the person was served with a notice of suspected non-compliance,

(l) where applicable, the absence, ineffectiveness or repeated failure of internal mechanisms or procedures of the person intended to prevent such a regulatory breach from occurring,

(m) where applicable, the extent and timeliness of any steps taken to end the regulatory breach and any steps taken to remedy the consequences of the regulatory breach,

(n) whether a financial penalty in respect of a similar regulatory breach has already been imposed on the person by a court or a competent authority, including by the Commission,

(o) any precedents set by a court or a competent authority, including the Commission, in respect of a similar regulatory breach,

(p) where applicable, the amount of any compensation paid or to be paid in accordance with section 96 ,

(q) any specific factors, criteria or methodology relevant to paragraphs (a) to (o) prescribed by the Minister for the purposes of this subsection, and

(r) any guidelines made by the Commission under section 98 in respect of the calculation of the amount of a financial penalty.

(2) The Commission may make rules for the purposes of the implementation of this section.

(3) The adjudicator may, having imposed a financial penalty on a person (in this subsection referred to as the “sanctioned person”) in accordance with this section and where he or she considers that it is necessary to do so in order to ensure that the penalty be appropriate, effective, proportionate and dissuasive, impose the penalty (whether jointly with or separately to the sanctioned person) on either or both of the following:

(a) a subsidiary of the sanctioned person;

(b) a person of which the sanctioned person is a subsidiary.

(4) The following shall apply for the purposes of this section:

(a) “subsidiary” shall have the same meaning as it has in section 7 of the Companies Act 2014 ;

(b) where a person is a partnership, for the purposes of the application to it of the definition of “subsidiary”—

(i) references to voting rights attaching to shares in a company shall be construed as references to votes or other rights exercisable by the partners in a partnership giving those partners the potential to exercise control or dominant influence over the activities of the partnership, and

(ii) references to a company’s constitution shall be construed as references to any agreement or practice governing or concerning the operation of the partnership;

(c) where a person is an unincorporated association, for the purposes of the application to it of the definition of “subsidiary undertaking”—

(i) references to voting rights attaching to shares in a company shall be construed as references to votes or other rights exercisable by the members of the unincorporated association giving those members the potential to exercise control or dominant influence over the activities of the unincorporated association, and references to a company’s constitution shall be construed as references to the constitution or of any agreement or practice governing or concerning the operation of the unincorporated association, and

(ii) references to a company’s constitution shall be construed as references to the constitution or of any agreement or practice governing or concerning the operation of the unincorporated association.

(5) The maximum amount of a financial penalty that an adjudicator may impose on a person under this Part in respect of a regulatory breach shall be—

(a) in the case of a person other than a natural person, the greater of €5 million and 10 per cent of the turnover of the person in the State in the financial year ending in the year immediately before the financial year in which the regulatory breach last occurred in the State, and

(b) in the case of a natural person, the greater of €500,000 and 10 per cent of the annual income of the person on whom the financial penalty is to be imposed, in the year preceding the year in which the regulatory breach last occurred.