In accordance with the First Motor Insurance Directive (72/166/EEC) of 24 April 1972, as amended by Directive (72/430/EEC) of 19 December 1972 and a subsequent Commission Decision of 6 February 1974, member states of the European Community are obliged to "refrain from making checks on insurance against civil liability in respect of vehicles which are normally based in the European territory of another Member State". This provision is linked to the fact that the national insurers' bureaux of the member states have concluded an agreement between one another under the terms of which each national bureau guarantees settlement, in accordance with the provisions of national law on compulsory insurance, of claims in respect of accidents occurring in its territory, caused by vehicles normally based in the territory, caused by another member state, whether or not such vehicles are insured. The Motor Insurers' Bureau of Ireland is a party to this agreement.
Similar arrangements apply in respect of vehicles from non-member states whose national motor insurers' bureaux become parties to the agreement referred to.