I have described Section 3 already as the pivotal section and would like to be quite sure of the interpretation of it. The first sub-section is merely a definition of the expression "Stock Exchange", being two bodies, the Dublin Stock Exchange and the Cork Stock Exchange. The second sub-section gives the essential conditions for a company to be an excluded company. The first is that it is a public company limited by shares and is an Irish company. I wanted to ask the Minister what is the meaning of saying it is an "Irish company" if it is merely—if we are to take the definition—registered in the State, under the Act of 1908 or some other Act. That will be a simple matter. Being a public company limited by shares, a guarantee is offered. I do not know why that should be so.
"Its Memorandum of Association and every Prospectus issued by it after the passing of this Act provide that the carrying on of a manufacturing process in relation to a commodity intended for export is a principal object". What does that mean, I wonder? When company Memoranda of Association are drawn up they will set out the objects and the ordinary company will have 20 or 30 objects, sub-paragraphs in the object clause but the early one will be in regard to whatever is the manufacturing process carried on. If the company is formed for the manufacture of boots and shoes, it will say its object is to manufacture boots and shoes. Later the sub-paragraphs will deal with money and borrowing powers and then it will go on down to deal with questions of transport and power to acquire steamers and all types of things. These are put in because the articles may later be against the company if it tries to do something ultra vires its own objects.
I look at this phrase: "is a principal object." There is never anything that can be really described as a principal object. There was once a certain school of thought that looked to the early clauses to see what was the dominant clause, as it is called, and all others were read as subsidiary or incidental to that. But the draftsman of company articles has long since forgotten that and it is entirely according to the will of the subscribers to the company how they will make their articles. Phrases used in one of the recognised books on the subject speak of company articles and says they may be "reasonable or unreasonable"; they may be "congruous or incongruous", "wise or ridiculous"; they may be "specific or general", and it is entirely inside the control of those who subscribe as to what they are going to be.
I am advised that if the company articles include in the objects clause one clause which says that the commodity to be manufactured is intended to be exported it will satisfy this condition. I do not know if that is intended but it would appear to be the manner in which it might well be dealt with.
At one time there was supposed to be a certain dominant or main clause and the others were taken as incidental or subsidiary to the earlier ones, but the application of what was called the prior object rule is taken with great caution by the courts which have rather set their face against it. However, if it was thought there would be some tendency after this to return to the primary object clause rule it could be avoided by putting in an independent clause with no relation to the other, saying "without prejudice to the generality of the foregoing..." and then go on to give a few specific clauses. What is aimed at here is export, and export, I suggest, in the ordinary run of things, could not be made the main clause, or the dominant clause, in the objects, because that would be whatever the process is, if it is the manufacture of shoes or the fabrication of steel goods or whatever business it will carry on. That will be the first object and will count as among the principal clauses.
One can put in very easily—as I said on the Second Reading, it would be an instruction to every draftsman of company articles—an export clause. That would, so to speak, make exporting one of the objects and so far as I can gather that satisfies the condition here. Personally, that is the way I would like it to be.
The other question is that 50 per cent. of the shares issued are to be made available to Irish citizens. I want to ask the Minister about this. It is an easy matter to have an issue made and to have it closed inside ten minutes if arrangements are made to have the shares taken, if, so to speak, the issue is arranged. That would not give any opportunity, but it could be claimed that it had been issued for public subscription in the State even though the list might close inside a very brief period. Apparently on the argument we already had that is to be handled by the Stock Exchange and that is the matter to which I object.
If the provisions here in regard to the excluding of companies means a liberalising, I welcome them. It would mean that nearly any company could fit in under such a provision if it simply provides an export clause among its object clauses.
I gather the Minister is inclined to accept the company if the Stock Exchange does and that it meets the two points (a) that it has issued shares in a bona fide way, and (b) that it has got a quotation. If it has got a quotation it does not matter what happens afterwards. If this is a liberalising provision in the Bill it is welcome and is, in fact, the only liberalisation in it.