The European Commission has taken the first step in infringement proceedings against Ireland over a directive on motor insurance.

The EU body has sent a letter of formal notice to 16 member states – including Ireland – for failing to notify it about the transposition of the relevant articles into national law.

The EU directive sets up a mechanism to compensate victims of road-traffic accidents in cases where the responsible insurer is insolvent.

Compensation

Under the measures, member states must appoint compensation bodies that will deal with claims stemming from these accidents.

The Government’s summer legislative programme published earlier this year stated that the heads of the Motor Insurance Insolvency Compensation Bill 2023 were currently being drafted.

The 16 member states now have two months to reply to the letters of formal notice and complete their transposition, or the commission may decide to take the next step in the process by issuing a reasoned opinion.