This paper provides an overview of the Integration Rules (IRules) approach to the interconnection of distributed software components. The intended use of this rule processing technology is for the specification of event-based processing logic in the development of component-based applications for distributed environments, such as E-commerce applications. The IRules approach builds upon the use of the Enterprise JavaBeans (EJB) software component model, providing an environment to facilitate the integration of black-box software components. An application integrator uses the IRules Component Definition Language to extend the definition of an EJB component in the IRules environment with derived and stored attributes, externalized relationships, and events. The application integrator then uses the IRules Integration Rule Language together with a scripting language to develop applications. Integration rules provide active rule capability to the environment so that as distributed components and external sources generate event notifications, integration rules are used to invoke methods on components or on higher-level application transactions. The IRules approach is unique in that it addresses the language and semantic framework needed in the context of software component models for the effective use of rules in distributed environments.