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A Control Agreement lets a lender take security over a bank account in Ireland while allowing the account holder to keep using it normally. It creates a three-way arrangement between the account holder, their bank, and the lender who wants security over the account funds.

Under Irish law, these agreements become crucial in secured lending deals, especially for business financing. They give lenders comfort by ensuring they can block access to the account if needed, while still letting the business operate day-to-day. The agreement must follow Irish Security and Financial Collateral rules to be enforceable - most Irish banks have their own standard forms for this.

Consider setting up a Control Agreement when taking out a business loan in Ireland and the lender wants security over your company's bank accounts. This happens often in asset-based lending, project finance, or when refinancing existing debt - especially if your business needs to keep accessing the accounts for daily operations.

It's particularly important for Irish companies working with international lenders or participating in syndicated loans. The agreement protects the lender's security interest while letting your business continue normal banking activities. Many Irish companies put these in place during major financing deals or when restructuring their banking relationships.

• For standard bank accounts, Control Agreements in Ireland typically use a "blocking rights" structure - the bank agrees to follow the lender's instructions about restricting account access
• More flexible "springing control" versions let account holders maintain full control until specific trigger events occur
• Some agreements include "dual control" mechanisms where both the lender and account holder must approve certain transactions
• For international financing, Irish banks often use "hybrid" versions that accommodate both local and foreign lending practices

• Account Holders: Usually Irish companies or businesses seeking financing while maintaining access to their bank accounts for daily operations
• Lenders: Banks, financial institutions, or private lenders who require security over the account holder's deposits as loan collateral
• Account Banks: The financial institutions where the secured accounts are held, who must implement the control mechanisms
• Legal Advisors: Irish solicitors who draft and negotiate the agreements, ensuring compliance with local security and financial collateral regulations
• Corporate Officers: Directors and company secretaries who execute the agreements on behalf of the account holder

• Account Details: Gather full account numbers, sort codes, and account types for all relevant bank accounts
• Party Information: Collect legal names, registered addresses, and company numbers for the account holder, lender, and account bank
• Security Package: Review existing loan and security documents to ensure alignment with control provisions
• Bank Requirements: Check the account bank's standard control agreement format and any specific operational requirements
• Notice Procedures: Define clear procedures for how and when control rights can be exercised
• Signing Authority: Confirm who has authority to execute the agreement for each party

• Party Identification: Full legal names and registered addresses of the account holder, lender, and account bank
• Account Details: Specific identification of all accounts covered by the agreement
• Control Mechanisms: Clear procedures for how and when the lender can exercise control rights
• Operating Instructions: Day-to-day account operation rules and restrictions
• Default Provisions: Triggers that allow the lender to block account access
• Notice Requirements: Communication protocols between all parties
• Irish Law Compliance: References to relevant financial collateral and security regulations
• Execution Blocks: Proper signing sections for all three parties under Irish law

A Control Agreement differs significantly from an Account Agreement. While both deal with bank accounts, they serve distinct purposes in Irish banking and finance law.

• Purpose and Scope: Control Agreements specifically create security rights over bank accounts for lenders, while Account Agreements establish the basic relationship between a bank and its customer
• Party Structure: Control Agreements involve three parties (account holder, lender, and bank), whereas Account Agreements are typically two-party contracts between the bank and account holder
• Legal Effect: Control Agreements grant specific rights to restrict account access during default scenarios, while Account Agreements outline general terms of service and operational rules
• Timing: Control Agreements are put in place during financing transactions, but Account Agreements are required when first opening any bank account