I propose to take Questions Nos. 3, 11 and 33 together.
There are many Irish manufacturers producing goods which could be sold on international markets if the company developed their own internal marketing capacity. However, for a variety of reasons, such as size, expertise and financial resources, many companies do not have the strength to develop their own exports.
In response to this situation, the Government introduced the special trading house scheme. Under this scheme, the special trading houses will do the overseas marketing for the supplier companies.
The special trading houses will engage solely in the marketing abroad of Irish manufactured goods (including software) on a wholesale basis. They will not be the manufacturer of those goods. The special trading houses will have to purchase and take title to the goods they intend selling and will not be allowed to operate on a commission basis.
As manufacturing firms will sell their goods to the special trading houses who in turn will sell to the overseas buyers, in general there will not be a direct relationship between the manufacturer and the overseas buyer. The special trading houses will locate, negotiate, agree and service the sales to the overseas buyers'.
Special trading houses and suppliers will determine for themselves the nature of their commercial relationship. There is nothing in the legislation which restricts the exporting opportunities of the supplier. Through the relationship, supplier firms will improve their awareness of overseas opportunities and will develop their capacity to service overseas contracts. Greater access to overseas markets will improve the marketing skills of the supplier and should lead him or her to taking initiatives on his or her own behalf in developing more overseas sales.
The conditions under which special trading house licences are issued are covered by the Export Promotion (Amendment) Act, 1987. In addition to this, I have had an information booklet prepared which clearly sets out the type of information which is required in support of any application. I have arranged to have copies of this booklet available in the Dáil Library.
The main criteria for judging an applicant for a special trading house licence is that the applicant should have the structure, organisation and marketing ability to undertake successfully the overseas marketing of Irish manufactured goods. In this respect, the applicant for a special trading house licence must supply my Department with details of his expertise in relation to the target markets and product sectors in which he intends selling, the management structure of the proposed trading house, the source and value of proposed equity finance and a full strategic marketing plan. Evidence of the commitment of manufactureres to supply the applicant with the proposed products must also be provided.
Every application is critically examined. An initial examination is undertaken by a technical assessment group comprised of officials of my office and CTT. Once this group are satisfied with the proposal, it is then examined by the special trading house management unit comprised of senior officials of my office, Córas Tráchtála and the Industrial Credit Corporation. It is only on the recommendation of that group, and through them the organisations which the group members represent, that is the Irish Export Board and ICC, that the application goes forward for ministerial approval.
The legislation introducing the scheme does not differentiate between private sector or public sector applicants. Applications from either sector would be examined on their individual merits. However, the main points to remember is that licensed special trading houses cannot engage in any activity other than the export of goods which they have not manufactured and that the supplier companies from which goods are sourced must employ fewer than 200 people.