I move that the Bill be now read a Second Time. The Bill proposes to set a date, 1st January 1968, from which the Control of Manufactures legislation will no longer operate, and in the meantime, to make some amendment of the law as it stands.
The restrictions imposed by the Control of Manufactures Acts were considerably relaxed by the Industrial Development (Encouragement of External Investment) Act, 1958. In addition to providing that certain small concerns would be exempted from the Control of Manufactures Acts, the 1958 Act enabled companies to be established whose business was primarily for export, without requiring that their shareholdings, et cetera, should be in accordance with the provisions of the Control of Manufactures Acts. This modification was in the interest of encouraging and facilitating external capital investment in the establishment of industrial undertakings in this country having the development of exports as their prime objective.
The Second Programme for Economic Expansion envisages that for the purpose of further facilitating increased investment in manufacturing industry the remaining restrictions on external investment in industry in this country will be removed by the repeal of the Control of Manufactures legislation during the currency of the Programme. This Bill gives effect to this by setting the date from which the Control of Manufactures legislation will cease to operate. The date of 1st January 1968 has been selected as a reasonable one to give industrialists time to adapt themselves to the new situation.
Pending the final repeal of the Control of Manufactures Acts from the 1st January, 1968, as proposed in section 2, the Bill also proposes, in section 1, that companies which have been continuously engaged in manufacture here for five years before the passing of this Bill, should be free from any restrictions imposed by the Control of Manufactures Acts. The same will apply to subsidiaries of such companies provided the latter hold more than half the issued shares and at least two-thirds of the voting shares.
During the passage of the 1958 Act, the question was raised as to why the Control of Manufactures Acts were not then being entirely repealed. The view was taken, however, that the time was not then ripe for total repeal and that there was still a case for retention of certain provisions of the Acts in the interest of firms which had come into existence because of the assurance given by the Acts. That was six years ago, however, and since then very much has happened on the industrial front—in particular, the development of a very strong international movement towards the freeing of trade in manufactured commodities. I am saying that in the full knowledge of the imposition of the British import charge which in recent times is accepted as likely to be of a temporary nature.
As Deputies are aware there has been in progress for some time past a very searching investigation by the Committee on Industrial Organisation of the ability of Irish industry to survive in freer trade conditions and substantial financial aid has been provided to enable industry to make the necessary adaptations to enable it to do so. The Government consider that in addition to the adaptation grants already made available manufacturing firms which have been operating here for five years or more should, in anticipation of the repeal of the Control of Manufactures legislation on 1st January, 1968, be given the opportunity, should they need it, of seeking external capital and "know-how" to strengthen further their competitive position. Section 1 of the Bill provides this opportunity.
I recommend the Bill for the approval of the House.