As we reported last December, the Court of Appeal affirmed the High Court's Judgment in favour of the trustees in the Omega Pharma case requiring the employers to make contributions to the employees' defined benefit pension scheme in excess of the statutory minimum funding standard ("MFS") in circumstances where the scheme was being wound up. Arthur Cox acted for the successful trustees.

Last month, the Court of Appeal gave its reasons for this decision and handed down its written judgment.

There were two key issues in the High Court case which were appealed by the employers to the Court of Appeal. The first related to when the employers' contribution liability terminated. The Court of Appeal upheld the High Court decision in finding that the parties had agreed three months' notice in accordance with the notice provisions in the trust deed.

The second issue was whether the trustees were entitled to make a contribution demand in excess of the MFS in circumstances where the scheme was solvent on that MFS basis.

In the High Court the employers argued that there was no justification for the contribution demand given that the Scheme was solvent on the MFS basis and that the employers' obligation had therefore been satisfied. This argument was rejected by the High Court. It concluded that the trustees had come to a reasonable decision as to the amount of the contribution demanded in the absence of any engagement by the employers.

In the Court of Appeal the Appellants conceded that the MFS was not sufficient to "support the Fund in order to provide the benefits under the Scheme". The second issue was therefore not argued before the Court of Appeal. Accordingly, the Court of Appeal found that the contribution demand which the trustees had sought was the "shortfall" for the purposes of the Scheme and that the trustees were entitled to recover this shortfall.

For further analysis of the Court of Appeal judgment, please see our update "Omega Pharma: The Appeal".


The new Companies Act, 2014 (the "Act") is anticipated to be commenced, in the main, from 1 June 2015. The Act involves an overhaul of the existing company law regime which has been in place since the 1960s. The Act segregates companies by corporate type and applies different law to each type of company. At the end of an 18 month transition period, commencing on 1 June 2015, existing private companies will be deemed to have become new model private companies limited by shares ("LTDs") (although existing companies may "opt out" of the new arrangements by resolution passed up to three months before the end of the transition period and become designated activity companies ("DACs") or any other type of company). Generally, existing private companies are required to take action and directors have legal obligations to do certain things at the end of the transition period in the event that the shareholders of the company take no action.

Corporate trustee directors of pension arrangements will need to be aware also of the new requirements under the Act and the manner in which they impact on their memorandum and articles of association ("M&A") and on their duties as directors of corporate trustees.

The Act introduces a number of key changes to companies limited by shares including:

  • the Act creates a new category of company known as a "designated activity company" or "DAC" for private companies which wish to have clearly defined objects. Existing corporate trustee companies may wish to transfer to the DAC regime;
  • directors' common law fiduciary duties have been codified and together with all diverse statutory duties have been included in the Act as a comprehensive code;
  • all offences are now clearly categorised as being either category 1, 2, 3 or 4 offences and the penalties applicable to each type are set out in one provision;
  • activities that might otherwise prejudice shareholders or creditors are permitted where the company complies with a "Summary Approval Procedure" which requires a special resolution and a declaration of solvency from the directors which, in some cases, must be supported by the report of an independent person;
  • Table A (the current model set of internal regulations adopted by significant numbers of private companies) will be abolished. Instead, depending on the type of corporate structure adopted, there will be a number of optional provisions which will apply as "statutory defaults" to govern the company unless the constitution provides otherwise;
  • directors of certain companies will be obliged to include a compliance statement in their directors' report stating that certain things have been done or else explaining why they have not been done.

All existing private companies should update their existing M&A with a new constitution; this can be done when reregistering as an LTD, DAC or any other type of company. Corporate trustees should review their M&A in light of the new changes being introduced by the Act and determine whether they need to take any action and if so, should discuss any proposed changes with their legal advisers.


The Social Welfare and Pensions (Miscellaneous) Act, 2013 (the "2013 Act") restructured the Pensions Board and spilt its functions into two distinct elements. With effect from 7 March 2014, the Pensions Board was renamed the Pensions Authority (the "Authority") and its CEO, Brendan Kennedy, was given the title of Pensions Regulator. The role of the Authority is confined to regulatory matters.

The policy functions of the old Pensions Board were transferred to the new Pensions Council (the "Council"). In early February 2015, the Tánaiste and Minister for Social Protection announced the members of the board of the Council. They are Jim Murray (Chair), Roma Burke, Kirstie Flynn, Dr Shane Whelan, Anthony Gilhawley, Brendan Keenan, Sandra Rockett and Sinead Ryan. The Pensions Regulator will also sit on the Council as will government nominees Helen McDonald (Social Protection), Marie Louise Delahunty (Finance/ Central Bank) and Peter Brazel (Public Expenditure and Reform).


At the announcement of the board of the new Council, the Minister for Social Protection also took the opportunity to announce the establishment of a new Universal Retirement Savings Group to "develop a roadmap and timeline" for the introduction of a universal pension scheme that would be mandatory for employees in Ireland. The Minister noted that just half of workers in Ireland have a pension other than the State pension and that workers in the private sector are less likely to have a private pension. The Minister did not indicate when the universal pension scheme would be introduced.

This announcement is consistent with the OECD report, Review of the Irish Pension System, which was published in April 2013. The OECD report considered that the main policy goal of reforming the Irish pension system should be to improve the adequacy of pensions and suggested the introduction of compulsory pension scheme membership (which was favoured over the auto-enrolment system introduced in the UK or additional tax relief or other incentives for pensions savings). The report did not detail costings or contribution structures.

This article contains a general summary of developments and is not a complete or definitive statement of the law. Specific legal advice should be obtained where appropriate.