Amendment No. 1 arises out of committee proceedings. Amendments Nos. 1, 5, 91 to 133, inclusive, 166, 171, 172, 177, 201, 202, 217, 219 to 226, inclusive, 236, 237, 251, 252, 269 and 271 are cognate and may be discussed together.
Companies Bill 2012: Report Stage
I move amendment No. 1:
In page 66, to delete lines 39 and 40.
The purpose of this amendment is to delete the definition of "licensed bank". The definition is no longer necessary as the Office of the Parliamentary Counsel has recommended use of "credit institution" rather than "licensed bank". This will result in uniformity of language throughout the Bill and is in line with EU law.
Amendment agreed to.
Amendments Nos. 2, 190 and 258 form a composite proposal and may be discussed together.
I move amendment No. 2:
In page 69, between lines 6 and 7, to insert the following:
" "system of interconnection of registers” means the system of interconnection of central commercial and companies registers established in accordance with Article 4a(2) of Directive 2009/101/EC of the European Parliament and of the Council of 16 September 2009;".
The purpose of the amendment is to define the system of interconnection of registers which is provided for by Directive 2012/17/EU of the European Parliament and the Council of 2012 and must be transposed by 14 July 2014.
Is the Minister of State confident all of the information shared with all member states will be treated properly, so that while there may be various methods of using information in other member states, all of the information shared will be respectfully used and managed?
I assure the Deputy the new directive ensures all EU member states enabling electronic communication between business registers and transmitting information to individual users will do so in a standardised way by means of identical content and interoperable technologies throughout the European Union. The system of interconnection of registers shall be composed of the registers of member states, a central platform, and one or more access portals. The European e-justice portal will serve as the European electronic access point and the new directive stipulates the European Commission may by means of implementing acts specify the technical specification, defining among others the structure of the standard message format for the purpose of the exchange of information between the registers, the platform and the portal, and the technical specifications defining the structure and the use of the unique identifier for communication between registers.
Does the Minister of State wish to address amendments Nos. 190 and 258?
I hope I have covered them.
Amendment agreed to.
Amendment No. 3 not moved.
Amendments Nos. 4, 6, 59 and 60 are cognate and may be discussed together.
I move amendment No. 4:
In page 77, line 34, after "activity" to insert "and be managed and controlled".
The first two amendments are interrelated. They detail the classification of the type of company to be established in the State.
The current proposals mean that a company must conduct some activity in the State. I believe this provision was established in 1998 and the idea was to stop the brass-plating of firms in Ireland. However, the Minister of State will understand that a loophole exists, which allows a company to be registered here but to be tax-resident in another state. This is where one comes to the idea of Irish-registered non-resident companies. A major worry for me is that shockingly, the Government does not have available a figure on how many such firms are in existence and one cannot manage if one cannot understand what are the figures. Tax residence is determined by where a company is managed and controlled from, and this simple amendment effectively means that a company registered in the State must also be managed and controlled in the State and must be tax resident in the State and make annual returns. If the Government is committed to dealing with the issue of tax avoidance, this is a great opportunity to so do.
It is important that Ireland does so for a number of reasons. Ireland's standing has reduced quite significantly internationally as a result of the understanding many countries have on the level of effective corporation taxes that firms pay. While the Minister of State might shrug and believe it is a matter of perspective, there are metrics and surveys to show that Ireland and the International Financial Services Centre in particular have fallen in standing as a result of the current scenario. The second important issue in this regard is that some of the details have shown that for some of these firms, effective tax rates can be between 1% and 6%. Given that most of the people for whom Members work, that is, the Irish public, pay taxes far in excess of this rate, it seems logical and fair that highly profitable firms which are registered here also would pay taxes commensurate with the level of profits they make. I ask the Minister of State to use this opportunity finally to close this loophole.
At the outset, I do not propose to support these amendments. This series of amendments proposes to insert the words "managed and controlled" into sections of the Bill. When one considers it, the objective appears to be to cause all companies registered in Ireland to be tax resident in Ireland. One must think carefully about this and neither I nor the Minister, Deputy Bruton, is in a position to consider the full impact or consequences of any change to tax law because such an exercise, for the purposes of this Bill, comes within the remit and the function of the Minister for Finance. Moreover, the proposed amendments are illegal under both European Union and international law. The provisions would fall foul of the European Union law on freedom of establishment, which is a core aspect of European Union law. Compliance with this is monitored closely by the European Commission and Ireland recently has been required by the Commission to change a provision of Irish law, which requires that at least one director of an Irish company be resident in Ireland. This provision, as proposed, would go much further and effectively would require all management activities to occur within the State. This clearly would be a hindrance to cross-border trade within the European Union and would trammel significantly the ability of a company from another European Union member state to establish itself in Ireland. Furthermore, the proposal would put Ireland in breach of obligations under double taxation agreements with other countries. This is completely unprecedented and would be highly prejudicial to Irish commerce and to Ireland's reputation internationally. Consequently, for these reasons I will not be accepting these amendments.
The Minister of State observed it is under the remit of the Department of Finance to focus on this issue. He also stated this amendment could do damage to Ireland's interpretation. I do not know whether the Minister of State has been watching the same television shows or reading the same newspapers as have I, because Ireland's reputation internationally has been trammelled. While this issue may be under the remit of the Minister for Finance, it is within the remit of the Government and this amendment provides the Government with an opportunity to resolve the issue.
As one Government Minister among many, we have spent considerable time over the past three years in travelling abroad and encouraging investment. I recently have returned from the mid-west of the United States, where Ireland's reputation regarding the potential for foreign direct investment is very strong. A clear message is coming from the United States of America, to name one country as an example, that there is a clear intent on the part of companies to explore the options of investing in a country like Ireland. Specific meetings have been held with specific target companies through IDA Ireland, companies have been brought out through Enterprise Ireland and no one I have met has mentioned anything about our reputation. The opposite is the case and while I would be interested to see the set of metrics to which the Deputy has access - if there are reputational issues - when it comes to a decision by a company to invest in Ireland, based on the companies that have been attracted here even over the past 24 months, it is clear there is significant interest in Ireland in respect of inward investment and creating jobs.
Amendment put and declared lost.
I move amendment No. 5:
In page 77, line 35, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 6:
In page 79, line 13, after “administration” to insert “, management and control”.
Amendment put and declared lost.
Amendments Nos. 7, 9 and 218 are related and may be discussed together.
I move amendment No. 7:
In page 83, to delete lines 23 and 24 and substitute the following:
“(3) In subsection (2), “person” means, for the purposes of paragraph (b) of it, the company referred to in that paragraph.”.
The purpose of amendment No. 7 is to correct the incorrect cross-reference in subsection (3) from paragraph (b) to (a). The purpose of amendment No. 9 is clarification. Deletion of the word "it" and its replacement with "the company" makes it clearer that the company shall notify the registrar of the authorisation of a person as being entitled to bind the company in the prescribed form. The function of amendment No. 218 is to clarify to whom the notification requirement applies. Section 1081 restates section 229(1) of the 1990 Act. The obligation to notify the Stock Exchange under section 229(1) only applies where shares have been purchased either by the company that issued the shares or by a company that is that company's subsidiary.
Section 1081, as it stands, extends this obligation beyond existing law to where shares are purchased by a body corporate, which includes companies incorporated abroad. This amendment is in line with the existing law and purports to maintain it.
Amendment agreed to.
Amendments Nos. 8 and 10 to 12, inclusive, may be discussed together.
I move amendment No. 8:
In page 88, line 35, after "Where" to insert "the board of directors of".
The purpose of these amendments is for clarification. The Bill, as it stands, has been interpreted as meaning the board of directors must be registered with the Companies Registration Office. That is not the intention of this section, which is drawn from existing law, Regulation 6(3) of the European Communities (Companies) Regulations 1973, SI 163 of 1973. It provides that where a company chooses to appoint a person to fully bind the company on its behalf, such a company must notify the registrar in the CRO, who will register the person as the company's registered person. Where a company revokes such an authorisation, the person will be considered as a registered person until the registrar is notified in the prescribed form of this revocation.
The purpose of such a provision is to reduce red tape for companies that wish to authorise a registered person to have full authority to exercise any power of the company. This will save banks and other third parties from having to search through the minutes of the company's board meetings to check whether a person is authorised to bind the company. This authority is limited by any power of management of the company exercisable by its board of directors or where this Bill requires a power to be exercised otherwise.
Amendment agreed to.
I move amendment No. 9:
In page 89, line 1, to delete "it" and substitute "the company".
Amendment agreed to.
I move amendment No. 10:
In page 89, line 6, after "by" to insert "the board of the directors of".
Amendment agreed to.
I move amendment No. 11:
In page 89, line 8, after "Where" to insert "the board of directors of".
Amendment agreed to.
I move amendment No. 12:
In page 89, line 24, after "by" to insert "the board of the directors of".
Amendment agreed to.
I move amendment No. 13:
In page 92, lines 13 and 14, to delete "if a company has appointed a registered person" and substitute "if there be a registered person in relation to a company,".
Amendment agreed to.
I move amendment No. 14:
In page 92, lines 16 to 18, to delete all words from and including "countersigned" in line 16 down to and including "purpose." in line 18 and substitute the following:
"countersigned—
(a) by the secretary or a director of the company; or
(b) by some other person appointed for the purpose by its directors or a committee of its directors authorised by its directors in that behalf.".
Amendment agreed to.
I wish to advise Members that a footnote has been omitted from amendment No. 244. The footnote should indicate that the reference to section 1019 in this amendment is a reference to the section being inserted by amendment No. 206. Amendments Nos. 15, 206 and 244 form a composite proposal and may be discussed together.
I move amendment No. 15:
In page 93, to delete lines 1 to 15.
I have been asked by the Bills Office to inform the House that there is a problem with a footnote to an amendment in this grouping. Amendment No. 244 ought to be accompanied by a footnote to state that section 1019, to which it refers, is being inserted by amendment No. 206.
The purpose of these amendments is to correct an unintended change caused by the Bill's structure and to revert to existing law in accordance with the policy intention. Section 45, which is the official seal for sealing securities, restates section 3 of the Companies (Amendment) Act 1977 and provides that a company may have an official seal which is a facsimile of the common seal for the purposes of sealing securities issued by the company and sealing documents creating or evidencing securities so issued.
Section 3 of the Act of 1977 does not apply to private limited companies. The policy is to restrict the scope of section 45 to public companies and to re-enact the existing law. Thus, this section should be deleted for private companies limited by shares. New sections are proposed to be inserted in the relevant parts to provide for PLCs, PUCs and PULCs. Such public companies shall have an official seal which is a facsimile of the common seal and which has on its face the word "securities" or the Irish language equivalent.
Amendment agreed to.
Amendments Nos. 16 and 17 are related and may be discussed together.
I move amendment No. 16:
In page 98, line 11, after "subsection (3)" to insert ", and without prejudice to subsection (7)".
Amendment agreed to.
I move amendment No. 17:
In page 98, line 27, after "that Act and" to insert ", without prejudice to subsection (8),".
Amendment agreed to.
I move amendment No. 18:
In page 106, line 4, after "shares" to insert the following:
"but, for the purposes of this definition, a company shall not be regarded as a subsidiary if it is such only by virtue of section 7(2)(a)(ii) or (e)".
Amendment agreed to.
I move amendment No. 19:
In page 107, line 6, after "this Act" to insert ", other than in section 70(11)(c),".
Amendment agreed to.
I move amendment No. 20:
In page 111, between lines 8 and 9, to insert the following:
"(5) Any director of a company who knowingly contravenes, or knowingly permits or authorises a contravention of, a preceding provision of this section shall be guilty of a category 3 offence.".
Amendment agreed to.
Amendments Nos. 21 to 25, inclusive, 208 and 209 are cognate and may be discussed together.
I move amendment No. 21:
In page 111, line 13, to delete "shares in the company of any class" and substitute "relevant shares, of the class concerned, in the company".
Amendment agreed to.
I move amendment No. 22:
In page 111, line 14, after "those" to insert "relevant".
Amendment agreed to.
I move amendment No. 23:
In page 111, line 18, to delete "each other person who holds shares in the company of any class" and substitute "each person who holds relevant shares, of the class concerned, in the company".
Amendment agreed to.
I move amendment No. 24:
In page 111, line 21, after "the" where it secondly occurs to insert "relevant".
Amendment agreed to.
I move amendment No. 25:
In page 111, to delete lines 26 and 27 and substitute the following:
"(6) In-
(a) subsection (5) "relevant shares", in relation to a company, means shares in the company other than shares which as respects dividends and capital carry a right to participate only to a specified amount in a distribution;
(b) subsection (5)(a)(ii) "non-member" means a person who is not holder of shares (as that expression is to be read by virtue of section 71(4)) in the company.".
Amendment agreed to.
Amendments Nos. 26 and 27 are related and may be discussed together.
I move amendment No. 26:
In page 112, to delete lines 11 and 12.
Amendment agreed to.
I move amendment No. 27:
In page 112, line 25, to delete "company." and substitute the following:
"company;
(f) to allotments of bonus shares.".
Amendment agreed to.
I move amendment No. 28:
In page 113, between lines 35 and 36, to insert the following:
“(12) If, before the commencement of section 70, the directors of a company have been granted authority, pursuant to section 20 of the Act of 1983, to allot relevant securities (within the meaning of that section 20) and that authority is in force immediately before that commencement—
(a) neither section 70 nor this section shall apply to the allotment, after that commencement, of relevant securities by the directors pursuant to that authority (which authority shall, in accordance with its terms, be taken to remain in force); and
(b) section 20 (other than subsections (4) and (9) thereof), and sections 23 and 24, of the Act of 1983 shall apply to that authority and any allotment of relevant securities on foot thereof,
but, on the expiry of that authority, section 70 and this section shall apply to any allotment thereafter of shares in the company (or the grant of any right to subscribe for shares in the company or to convert securities into such shares).
(13) For the purposes of subsection (12)—
(a) “Act of 1983” means the Companies (Amendment) Act 1983;
(b) the reference to the grant of an authority includes a reference to the conferral, by the articles of the company, of an authority; and
(c) the exclusion of the application of section 20(4) of the Act of 1983 by paragraph (b) of subsection (12) shall not be taken as preventing the renewal of the authority concerned under section 70 and this section, but if that authority is so renewed, section 70 and this section shall apply to any allotment, or the grant of any right, as mentioned in subsection (12), that occurs after that renewal of authority on foot thereof.".
Amendment agreed to.
I move amendment No. 29:
In page 126, line 12, to delete "2 daily newspapers" and substitute "one daily newspaper".
Amendment agreed to.
I move amendment No. 30:
In page 131, lines 40 and 41, to delete all words from and including "may," in line 40 down to and including "capital," in line 41 and substitute the following:
"may for any purpose (with the result that its company capital is thereby re-organised)".
Amendment agreed to.
Amendments Nos. 31 and 32 are related and may be discussed together.
I move amendment No. 31:
In page 133, line 26, after "transferor" to insert the following:
", save that if the share concerned (or one or more of the shares concerned) is not fully paid, the instrument shall be executed by or on behalf of the transferor and the transferee".
Amendment agreed to.
I move amendment No. 32:
In page 133, to delete line 27 and substitute "(3) The".
Amendment agreed to.
I move amendment No. 33:
In page 142, to delete lines 21 to 23 and substitute the following:
"(4) Subject to this Part, the acquisition by a company of its own shares shall be authorised by—".
Amendment agreed to.
I move amendment No. 34:
In page 143, line 1, to delete "any member of the company" and substitute the following:
"any member holding one or more shares in the company conferring the right to vote at the meeting concerned".
Amendment agreed to.
I move amendment No. 35:
In page 143, lines 16 and 17, to delete "30 days" and substitute "21 days".
Amendment agreed to.
I move amendment No. 36:
In page 150, between lines 12 and 13, to insert the following:
"(6) No authorisation is required to be given under subsection (3) by any body corporate unless it is a company formed and registered under this Act or an existing company.".
Amendment agreed to.
I move amendment No. 37:
In page 151, lines 14 and 15, to delete "or referred to in paragraph 82 of that Schedule".
Amendment agreed to.
I move amendment No. 38:
In page 152, between lines 1 and 2, to insert the following:
"(9) Notwithstanding anything in the preceding subsections of this section, but without prejudice to any contrary provision of—
(a) an order of, or undertaking given to, the court;
(b) the resolution for, or any other resolution relevant to, the reduction of company capital; or
(c) the company’s constitution,
a reserve arising from the reduction of a company's company capital is to be treated, both for the purposes of this section and for purposes otherwise, as a realised profit.".
Amendment agreed to.
Amendments Nos. 39 to 41, inclusive, 45, 46 and 86 are cognate and may be discussed together.
I move amendment No. 39:
In page 153, line 33, after "relevant" to insert "entity".
Amendment agreed to.
I move amendment No. 40:
In page 153, line 36, after "relevant" to insert "entity".
Amendment agreed to.
I move amendment No. 41:
In page 153, line 38, after "last" to insert "entity".
Amendment agreed to.
Amendments Nos. 42 to 44, inclusive, are cognate and may be discussed together.
I move amendment No. 42:
In page 154, line 1, after "statements" to insert ", respecting the company alone,".
Amendment agreed to.
I move amendment No. 43:
In page 154, line 8, after "statements")" to insert ", respecting the company alone,".
Amendment agreed to.
I move amendment No. 44:
In page 154, line 12, after "statements")" to insert ", respecting the company alone,".
Amendment agreed to.
I move amendment No. 45:
In page 154, line 15, after "relevant" to insert "entity".
Amendment agreed to.
I move amendment No. 46:
In page 154, line 41, after "relevant" to insert "entity".
Amendment agreed to.
I move amendment No. 47:
In page 156, to delete lines 39 to 42, and in page 157, to delete lines 1 and 2.
Amendment agreed to.
Amendments Nos. 48 to 54, inclusive, are related and may be discussed together.
I move amendment No. 48:
In page 158, to delete lines 24 to 27 and substitute the following:
"(2) In subsections (3) and (4) "relevant sum" means—
(a) any sum for the time being standing to the credit of the company’s undenominated capital;
(b) any of the company’s profits available for distribution; or
(c) any sum representing unrealised revaluation reserves arising on a revaluation of all the fixed assets of the company.".
Amendment agreed to.
I move amendment No. 49:
In page 158, line 34, to delete "or debentures".
Amendment agreed to.
I move amendment No. 50:
In page 158, line 35, to delete "or debentures".
Amendment agreed to.
I move amendment No. 51:
In page 159, line 11, to delete "or debentures".
Amendment agreed to.
I move amendment No. 52:
In page 159, line 14, to delete "or debentures".
Amendment agreed to.
I move amendment No. 53:
In page 159, line 16, to delete "or debentures".
Amendment agreed to.
I move amendment No. 54:
In page 159, line 21, to delete "or debentures".
Amendment agreed to.
Amendments Nos. 55 to 58, inclusive, are related, with amendments Nos. 56 to 58, inclusive, forming a composite proposal. Therefore, amendments Nos. 55 to 58 may be discussed together.
I move amendment No. 55:
In page 163, line 11, to delete “one, at least,” and substitute “a majority”.
I am sure the Minister of State will just agree to these amendments and reciprocate my good wishes. Amendments Nos. 56 to 58 deal with the bond of €25,000 in circumstances where there is no director resident in Ireland. A more realistic approach would be to set €25,000 as the minimum, 4% of company turnover or 2% of the wages bill, whichever is higher. A bond is particularly relevant in circumstances where an employee or employees are left with unpaid wages, which could be as much as two months' pay, plus redundancy. In those circumstances, it would fall back on the State to make those payments from the insolvency fund. These amendments, therefore, are designed to save the Exchequer money.
The Deputy is taking a novel approach, which I admire, but I am not in favour of adopting these amendments. The Deputy's proposals impose unduly oppressive conditions on legitimate businesses. The suggestion that a majority of directors should be EEA-resident may particularly dissuade foreign direct investment companies from doing business in this country, which would be bad for Ireland and for Irish commerce generally. Section 138, which re-enacts existing law, ensures that companies which do not have at least one director who is resident in an EEA state must put in place a bond, in the prescribed form, that becomes payable to a person nominated by the registrar or the Revenue Commissioners. The purpose of the bond is to discharge any fine imposed on the company in respect of an offence committed by it and prosecutable by the registrar or for the purpose of discharging certain fines and penalties imposed on it by the Taxes Consolidation Act 1997. The moneys can also be used to cover expenses that are reasonably incurred in the collection of said penalties. The bond cannot be used for any other purpose. Therefore, the amendments proposed do not achieve any legitimate policy goal. Their sole effect is to create an arbitrary restriction on non-EEA companies trying to do business in Ireland. In that context, the Government will not support the amendments.
There is serious exposure of employees right through the system. We have seen a plethora of employees in recent years having to fight very hard to ensure they get their entitlements. These amendments seek to ensure that workers who have expended their energies, brain power and efforts to make a profit for a company or business are protected. They would be protected using the mechanism outlined in the amendments. It would be a policy objective of the Government to ensure that employees are fully protected in every case. It would also be a policy objective of the Government to reduce the State's exposure to potential shortfalls in the context of redundancy and insolvency. Unpaid remuneration in these times of contraction is all too common. I would urge the Minister of State to reconsider these amendments.
The Deputy has not said anything with which I would disagree, in principle. There is no question about the importance of the protection of employees. However, the corpus of law that would deal with that issue effectively is employment rather than company law. We have a very enhanced labour relations structure in this country. We also have an insolvency fund which is run by the Department of Social Protection. It is on that basis that we will not support the Deputy's amendments. We do not propose to incorporate the spirit of those amendments, as articulated by the Deputy, into company law because we feel that protections for employees already exist within employment law. Therefore, as I have already stated, we will not be accepting the amendments.
Question, "That the words proposed to be deleted stand", put and agreed to.
Amendment declared lost.
I move amendment No. 56:
In page 163, line 14, after “€25,000” to insert “or 4 per cent of turnover or the total wages paid, whichever is the greater”.
Amendment put and declared lost.
I move amendment No. 57:
In page 163, line 18, to delete “purpose” where it secondly occurs and substitute “purposes”.
Question, "That the words proposed to be deleted stand", put and agreed to.
Amendment declared lost.
I move amendment No. 58:
In page 163, line 22, after “accordingly)” to insert the following:
“or in the case of unpaid remuneration the amount payable under the redundancy and insolvency schemes”.
Amendment put and declared lost.
I move amendment No. 59:
In page 165, line 37, after “on” to insert “and managed and controlled”.
Amendment put and declared lost.
I move amendment No. 60:
In page 166, line 17, after “trade” to insert “and is managed and controlled”.
Amendment put and declared lost.
Amendments Nos. 61, 68, 69, 136, 141, 159, 178, 188, 189, 232, 235 and 254 are drafting amendments and may be discussed together.
I move amendment No. 61:
In page 170, line 19, to delete “In the case of” and substitute “Subject to subsection (1), in the case of”.
Amendment agreed to.
I move amendment No. 62:
In page 175, to delete lines 8 and 9 and substitute the following:
“(iii) in the case of a married person or civil partner, the name or surname by which he or she was known previously to his or her marriage or civil partnership.”.
The purpose of the further amendment to this section is to make provision for a married person or civil partner and by making the section gender neutral by providing for his or her. This subsection is drawn from existing law and clarifies the use of the terms “surname” and “former forename”.
Amendment agreed to.
Amendments Nos. 63 and 183 are related and may be discussed together.
I move amendment No. 63:
In page 176, between lines 11 and 12, to insert the following:
“(9) If a person appointed a director of a company before the commencement of this section has, subsequent to his or her appointment but before that commencement, become disqualified under the law of another state (whether pursuant to an order of a judge or a tribunal or otherwise) from being appointed or acting as director or secretary of a body corporate or an undertaking, then subsection (1) shall apply to such a case as it applies to a case of a director becoming so disqualified after that commencement.
(10) For the purpose of the application of subsection (1) to the case first-mentioned in the preceding subsection, section 150 shall apply as if the following subsection were substituted for subsection (8):
“(8) The company shall, within the period of 3 months after the commencement of this section, send to the Registrar a notification in the prescribed form of the change and of the date on which it occurred.”.”.
Amendment agreed to.
Amendments Nos. 64 and 65 are related and may be discussed together.
I move amendment No. 64:
In page 180, line 4, after “tax” to insert “or the universal social charge”.
The purpose of these amendments is to insert a reference to the universal social charge, USC. As the Bill stands, there is a prohibition on the payment of remuneration to a director free of income tax. It is, however, silent regarding the USC. It is proposed this section be amended to include the USC, so that it shall not be lawful to pay a director a remuneration free of income tax and the USC.
Amendment agreed to.
I move amendment No. 65:
In page 180, line 14, after “tax” to insert “and the universal social charge”.
Amendment agreed to.
I move amendment No. 66:
In page 180, between lines 32 and 33, to insert the following:
“(3) Without prejudice to the generality of that subsection, subsection (1) operates to enable, subject to a limitation (if any) arising under any of paragraphs (a) to (c) of it, the directors of the company to exercise all powers of the company to borrow money and to mortgage or charge its undertaking, property and uncalled capital, or any part thereof.”.
The purpose of this amendment is to reflect existing law by helpfully clarifying that directors are granted powers to borrow money and create charges.
Amendment agreed to.
I move amendment No. 67:
In page 182, to delete lines 31 to 34 and substitute the following:
“162. (1) A resolution in writing signed by all the directors of a company, or by all the members of a committee of them, and who are for the time being entitled to receive notice of a meeting of the directors or, as the case may be, of such a committee, shall be as valid as if it had been passed at a meeting of the directors or such a committee duly convened and held.”.
The purpose of this amendment is to provide a helpful clarification regarding committees. The section contains supplemental provisions about meetings. The purpose of subsection 1 is to enable directors to decide on any particular matter without coming together for a formal meeting. As committees are also to be allowed use written resolutions, reference to them is included in the first part of the sentence.
Amendment agreed to.
I move amendment No. 68:
In page 189, line 29, to delete “subsections (1) and (2)” and substitute “subsections (1) and (3)”.
Amendment agreed to.
I move amendment No. 69:
In page 189, lines 31 and 32, to delete “subsection (3)” and substitute “subsection (4)”.
Amendment agreed to.
I move amendment No. 70:
In page 194, line 6, after “company” to insert “(being a bankrupt member who is entitled to vote at the meeting)”.
The purpose of this amendment is for clarification. Again, notice of every general meeting shall be given to the assignee in bankruptcy of a bankrupt member of the company, that is to say, a bankrupt member who is entitled to vote at the meeting as opposed to a bankrupt member who is not entitled to vote.
Amendment agreed to.
I move amendment No. 71:
In page 195, between lines 36 and 37, to insert the following:
“(4) Subsection (4) shall apply unless the company’s constitution provides otherwise.”.
The purpose of this amendment is to determine the period which must elapse before a meeting must be adjourned for lack of a quorum. The time for the initial meeting has been shortened from 30 minutes to 15 minutes. The amendment to this section allows for the period to be modified by the company’s constitution.
Amendment agreed to.
I move amendment No. 72:
In page 213, line 21, after “liabilities” to insert the following:
“(being the debts and liabilities identified for the purposes of paragraph (d) and so far as not already paid or discharged)”.
Amendment agreed to.
I move amendment No. 73:
In page 219, between lines 12 and 13, to insert the following:
“(5) Subsection (5) does not apply—
(a) if the services to the other computer there mentioned are provided by means of the technology commonly known as cloud computing or by any other distance hosting solution; or
(b) to the extent that regulations under subsection (6) provide that it shall not apply.”.
The purpose of this amendment is to widen the section’s scope so as to provide for different methods of storing virtual information. As the Bill stands, the use of the term “server” is too restrictive and many companies now use cloud or hosted solutions to address IT technical requirements.
Amendment agreed to.
Amendments Nos. 74 and 158 are related and may be discussed together.
I move amendment No. 74:
In page 222, to delete lines 36 to 40, and in page 223, to delete lines 1 to 13 and substitute the following:
“219. (1) Subsections (3) and (4) shall apply to any case in which a provision of this Act requires or authorises a notice to be served on or given to a member of a company by the company, or an officer of it, but save to the extent that the constitution of the company provides otherwise.
(2) Subsection (5) shall only apply if there is contained in the company’s constitution a provision to the effect that it shall apply (but nothing in this subsection shall prevent alternative and reasonable provision being made in the constitution with regard to one or more of the matters set out in that subsection and, to the extent that such alternative and reasonable provision is made, that provision shall apply instead of that subsection).
(3) A notice referred to in subsection (1) shall, save where the means of serving or giving it specified in paragraph (d) is used, be in writing and may be served on or given to the member in one of the following ways:
(a) by delivering it to the member;
(b) by leaving it at the registered address of the member;
(c) by sending it by post in a prepaid letter to the registered address of the member;
or
(d) if the company’s constitution permits the use of electronic means to serve or give the notice or the conditions specified in subsection (4) are satisfied, by electronic means.
(4) The conditions referred to in subsection (3)(d) are—
(a) the member has consented in writing to the company, or the officer of it, using electronic means to serve or give notices in relation to him or her;
(b) at the time the electronic means are used to serve or give the notice in relation to the member, no notice in writing has been received by the company or the officer concerned from the member stating he or she has withdrawn the consent referred to in paragraph (a); and
(c) the particular means used to serve or give the notice electronically are those that the member has consented to.
(5) Any notice served or given in accordance with subsection (3) shall be deemed, in the absence of any agreement to the contrary between the company (or, as the case may be, the officer of it) and the member, to have been served or given—
(a) in the case of its being delivered, at the time of delivery (or, if delivery is refused, when tendered);
(b) in the case of its being left, at the time that it is left;
(c) in the case of its being posted (to an address in the State) on any day other than a Friday, Saturday or Sunday, 24 hours after despatch and in the case of its being posted (to such an address)—
(i) on a Friday — 72 hours after despatch; or
(ii) on a Saturday or Sunday — 48 hours after despatch;
(d) in the case of electronic means being used in relation to it, 12 hours after despatch.”.
The purpose of these amendments is to improve the ability of companies to service notice in a modern and effective manner.
Amendment agreed to.
Amendments Nos. 75 to 77, inclusive, not moved.
Amendment No. 79 is a physical alternative to Amendment No. 78 . They may be discussed together.
I move amendment No. 78:
In page 228, to delete lines 16 to 35, to delete page 229, and in page 230, to delete lines 1 to 6 and substitute the following:
“226. The Act of 1990 is amended by inserting the following in Part X:
“205E. (1) In this section—
‘amount of turnover’ and ‘balance sheet total’ have the same meanings
as in section 8 of the Companies (Amendment) Act 1986;
‘relevant obligations’, in relation to a company, means the company’s obligations under—
(a) the Companies Acts,
(b) tax law, and
(c) any other enactments that provide a legal framework within which the company operates and that may materially affect the company's financial statements;
‘tax law’ means—
(a) the Customs Acts,
(b) the statutes relating to the duties of excise and to the management
of those duties,
(c) the Tax Acts,
(d) the Capital Gains Tax Acts,
(e) the Value-Added Tax Act 1972 and the enactments amending or
extending that Act,
(f) the Capital Acquisitions Tax Act 1976 and the enactments
amending or extending that Act,
(g) the statutes relating to stamp duty and to the management of that
duty, and
(h) any instruments made under an enactment referred to in any of paragraphs (a) to (g) or made under any other enactment and relating to tax.
(2) This section applies to—
(a) a public limited company (whether listed or unlisted), and
(b) a private company limited by shares, but it does not apply to a company referred to in paragraph (a) or (b) that is of a class exempted under section 48(1)(j) of the Act of 2003 from this section or to a company referred to in paragraph (b) while that company qualifies for an exemption under subsection (9).
(3) The directors of a company to which this section applies shall, as soon as possible after the commencement of this section or after this section becomes applicable to the company, prepare or cause to be prepared a directors’ compliance statement containing the following information concerning the company:
(a) its policies respecting compliance with its relevant obligations;
(b) its internal financial and other procedures for securing compliance with its relevant obligations;
(c) its arrangements for implementing and reviewing the effectiveness of the policies and procedures referred to in paragraphs (a) and (b).
(4) The directors’ compliance statement (including any revisions) must—
(a) be in writing,
(b) be submitted for approval by the board of directors,
(c) at least once in every 3 year period following its approval by the board, be reviewed and, if necessary, revised by the directors, and
(d) be included in the directors’ report under section 158 of the Principal Act.
(5) The directors of a company to which this section applies shall also include in their report under section 158 of the Principal Act a statement—
(a) acknowledging that they are responsible for securing the company’s compliance with its relevant obligations,
(b) confirming that the company has internal financial and other procedures in place that are designed to secure compliance with its relevant obligations, and, if this is not the case, specifying the reasons, and
(c) confirming that the directors have reviewed the effectiveness of the procedures referred to in paragraph (b) during the financial year to which the report relates, and, if this is not the case, specifying the reasons.
(6) In addition, the directors of a company to which this section applies shall in the statement required under subsection (5)—
(a) specify whether, based on the procedures referred to in that subsection and their review of those procedures, they are of the opinion that they used all reasonable endeavours to secure the company’s compliance with its relevant obligations in the financial year to which the annual report relates, and
(b) if they are not of that opinion, specify the reasons.
(7) For the purposes of this section, a company’s internal financial and other procedures are considered to be designed to secure compliance with its relevant obligations and to be effective for that purpose if they provide a reasonable assurance of compliance in all material respects with those obligations.
(8) Where the directors of a company to which this section applies fail—
(a) to prepare, or to cause to be prepared, a directors’ compliance statement as required by subsections (3) and (4)(a) to (c),
(b) to include a directors’ compliance statement in the directors’ report as required by subsection (4)(d), or
(c) to comply with subsections (5) and (6), each director to whom the failure is attributable is guilty of an offence.
(9) A private company limited by shares qualifies for an exemption from this section in respect of any financial year of the company if—
(a) its balance sheet total for the year does not exceed—
(i) €7,618,428, or
(ii) if an amount is prescribed under section 48(1)(l) of the Act of 2003 for the purpose of this provision, the prescribed amount,
and
(b) the amount of its turnover for the year does not exceed—
(i) €15,236,856, or
(ii) if an amount is prescribed under section 48(1)(l) of the Act of 2003 for the purpose of this provision, the prescribed amount.
205F.(1) The auditor of a company to which section 205E applies shall undertake an annual review of—
(a) the directors’ compliance statement under subsections (3) and (4) of that section, and
(b) the directors’ statement under subsections (5) and (6) of that section, to determine whether, in the auditor’s opinion, each statement is fair and reasonable having regard to information obtained by the auditor, or by an affiliate of the auditor within the meaning of section 205D, in the course of and by virtue of having carried out audit work, audit-related work or non-audit work for the company.
(2) The auditor shall—
(a) include in the auditor’s report appended to the company’s annual accounts a report on, and the conclusions of, the review undertaken under subsection (1), and
(b) where any statement reviewed under subsection (1) is not, in the auditor’s opinion, fair and reasonable—
(i) make a report to that effect to the directors, and
(ii) include that report in the auditor’s report appended to the annual accounts.
(3) Where, in the auditor’s opinion, the directors have failed—
(a) to prepare, or to cause to be prepared, a directors’ compliance statement as required by section 205E(3) and (4)(a) to (c),
(b) to include a directors’ compliance statement in the directors’ report as required by section 205E(4)(d), or
(c) to comply with section 205E(5) and (6), the auditor shall report that opinion and the reasons for forming that opinion to the Director of Corporate Enforcement.
(4) Section 194(6) applies, with the necessary modifications, in relation to an auditor’s compliance with an obligation imposed on him by or under this section as it applies in relation to an obligation imposed by or under section 194.
(5) A person who contravenes this section is guilty of an offence.”.”.
Three dissenting voices have centred around this element of the legislation, namely the Office of the Director of Corporate Enforcement, ODCE, the Revenue Commissioners and the Irish Congress of Trade Unions, ICTU. One of the main complaints about this Bill is that it has been so long coming to the fore that it reflects much of the thinking of pre-crash Ireland. We have learned much since then, especially that light-touch regulation can cost an economy dearly. When ICTU, the ODCE and Revenue are agreed on a provision of the Bill it is important for the Oireachtas to take notice of it.
The OCDE stated it was not prepared to endorse the mitigated directors' compliance statement provision recommended by the company law review group for the following reasons. As the body responsible for encouraging compliance with company law, including the preparation of books of account which give a true and fair view of a company’s state of affairs, the ODCE finds unacceptable a proposal which omits reporting on obligations that may materially affect the company’s financial statements. The proposal that a company may rely at the directors' discretion on internal or external advisers to help secure compliance is unnecessary. It would also institutionalise a heavy advisory cost. The provision of the auditor review of the directors' compliance statement has been entirely deleted, which was a key recommendation of the auditing review group. The proposal that a company has in place appropriate arrangements or structures to secure compliance is unclear. It appears possible that the appropriate structure can be independent of any arrangements of procedures for securing compliance. The proposed definition of material compliance no longer requires the arrangements of structures to be placed.
Section 44 of the 2003 Act is considered by many of these organisations to be superior.
This section contains the form of directors' compliance statement as recommended by the company law review group. Having analysed the provisions contained in the 2003 Act, the group determined that such extra duties, as set out in the Act, would do little to increase compliance. In fact, it would actually result in an increase in red tape at significant cost to businesses. The set-up cost to a business was estimated at €90,000 with the ongoing annual costs at €40,000. A streamlined version of the directors' compliance statement proposed by the group removed the requirement that the statement included a declaration that the company has complied with all other enactments that could affect its financial performance. This was found to be the most burdensome aspect of the statement, as well as the least relevant as companies are already legally obliged to comply with all Acts. Their inclusion in the statement does not add any substantive duties.
A majority of the group, including members representing the Financial Regulator and other public bodies, agreed to a more balanced version of the statement.
There is a strong EU impetus towards less unnecessary regulation to make EU businesses more competitive. This amendment would create unjustifiable and disproportionate costs on Irish businesses without adding value in terms of protection and would disadvantage Ireland competitively as it would go beyond other countries and perhaps beyond the regime north of the Border. The directors' compliance statement as it stands has broad support from industry and regulators alike. For these reasons, it is intended to preserve the directors' compliance statement, DCS, as it currently stands within the Bill. On that basis, we do not propose to accept the amendment.
The fight against red tape and extra costs will always be and has always been the argument for getting rid of regulation. By its nature, regulation has an extra cost and creates a level of red tape for businesses. Nobody is arguing that we should get rid of regulation totally. Irish businesses would be more competitive if they were not required to write up health and safety statements or if we got rid of all regulation that exists to prevent problems and ensure firms adhere to their responsibilities to their staff, their environment, community and government.
The point is whether there is a balance between responsibilities to the greater community and the responsibility to make a profit for the shareholders. We need to set the balance there. However, a substantially watered down version of what we require has found its way into the Bill. The Bill is weaker and vaguer. The majority of the concerns of ICTU and the ODCE etc. were ignored. In my experience it is seldom we have seen such strong statements from the three disparate organisations in critique of this element of the legislation. If we are to learn anything from the collapse of the past number of years, it should be that regulation, when necessary, is valuable, saves money in the long term and reduces the cost burden for the State.
Question, "That the words proposed to be deleted stand", put and declared carried.
Amendment declared lost.
Amendment No. 79 not moved.
I move amendment No. 80:
In page 233, to delete lines 34 and 35 and substitute the following:
“(10) Any reference in this section to a contract —
(a) shall be read as excluding a reference to a contract the decision as to whether to enter into it is taken, or falls to be taken, other than by the board of directors or a committee of which the first-mentioned director in subsection (1) is a member;
(b) shall be read as including a reference to any transaction or arrangement, whether or not constituting a contract, but, in a case where the transaction or arrangement does not constitute a contract, a like limitation to that which applies under paragraph (a) applies to the construction of reference provided by this paragraph.”.
The purpose of this amendment is to provide clarification. The Bill, as it stands, may lead to a misinterpretation that could result in a situation where directors may feel obliged to seek board approval for minor matters such as opening deposit accounts. This was never intended to be the case.
Amendment agreed to.
Amendment No. 81 not moved.
I move amendment No. 82:
In page 240, line 32, to delete “private company limited by shares ” and substitute “company formed and registered under this Act or an existing company”.
The purpose of this amendment is to provide clarification. The wording as it currently stands is misleading in the context of the overall approach and layout of the Bill and suggests, incorrectly, that company types other than private companies limited by shares are not required to give approval under this section.
Amendment agreed to.
I move amendment No. 83:
In page 242, to delete lines 8 to 10 and substitute the following:
“(b) the amount of a company’s relevant assets shall be determined in accordance with section 239(2); and
(c) there shall not be reckoned any arrangement entered into in accordance with the Summary Approval Procedure.”.
The purpose of this amendment is to provide exemptions in regard to arrangements which have already been properly approved in accordance with the summary approval procedure.
Amendment agreed to.
I move amendment No. 84:
In page 245, between lines 37 and 38, to insert the following:
“(7) No approval is required to be given under this section by any body corporate unless it is a company formed and registered under this Act, an existing company or a wholly owned subsidiary of a body corporate.”.
The purpose of this amendment is to correct an omission. The amendment provides that no approval is required to be given under this section by any body corporate, unless it is a company formed and registered under this Act, an existing company or a wholly owned subsidiary of body corporate. As the Bill stands, subsection (6) of section 28 of the Companies Act 1990 has not been included and the amendment rectifies the position.
Amendment agreed to.
I move amendment No. 85:
In page 264, between lines 32 and 33, to insert the following:
“(d) a certificate of tax compliance,”.
I have dealt with a number of businesses in my constituency over the past number of years. One example of such businesses concerns a young man with a young family who set up a construction company and sub-contracted work to a contractor. Over a period of seven or eight years, he allowed the contractor to build up a level of credit, on the understanding the contractor was tax compliant. Half way through the period, the young man invested a considerable amount of money in his business but subsequently found out the contractor was not tax compliant for six or seven years, but was still trading and operating. As a result, the young man's business collapsed because of the level of exposure built up over that period.
It is important that we ensure that companies operating in these areas are tax compliant. This amendment provides that companies making an annual return must provide a certificate of tax compliance as part of the process. This is to ensure that no company can continue to be registered if it is not fully tax compliant. There may be an issue with regard to synching annual returns with tax returns, but it is intended that the tax compliance certificate be available for the most recent year. This would be a positive move and would give confidence to all elements of the supply chain that whoever they are dealing with is not in danger of hammering them or exposing them to risk.
I am given to understand that a company's tax compliance can be checked out with the Revenue Commissioners, but the Chair may correct me on that.
We do not support the amendment, but I believe compliance can be checked.
That would be confidential.
Perhaps we can provide some clarification on that.
This is not a logical inclusion in a company's financial statements, but the Deputy may have alluded to this in his statement defending the amendment. Financial statements relate to the company's financial performance, not to its tax obligations. Fiscal accounting addresses tax obligations. If the Government was to consider a requirement to require businesses to obtain and publish a certificate of tax compliance, it would do so in tax law, not company law, in order to catch both company and non-company businesses that also pay taxes. The introduction of this requirement would be entirely without precedent across the European Union. It is on that basis the we do not propose to support the amendment.
Amendment put and declared lost.
I move amendment No. 86:
In page 270, line 26, after “company’s” to insert “entity”.
Amendment agreed to.
Amendments Nos. 87 and 88 are related and may be discussed together.
I move amendment No. 87:
In page 273, lines 30 and 31, to delete “a record of all goods purchased, and of all goods sold (except those sold by way of ordinary retail trade)” and substitute “a record of all transactions whereby goods are purchased and whereby goods are sold”.
The purpose of these amendments is to make certain that all transactions must be recorded in writing, especially in cash businesses. The proposed change will align the company law requirements with those in regulation 27(1)(b) of the VAT regulations and section 886 of the Taxes Consolidation Act 1997 in regard to the keeping of records.
Amendment agreed to.
I move amendment No. 88:
In page 274, line 2, to delete “of the services provided or purchased” and substitute “of all transactions whereby services are provided and whereby services are purchased”.
Amendment agreed to.
With the indulgence of Members, I would like to comment on a point made on amendment No. 85 by Deputy Tóibín.
In so far as the Minister of State mentioned that there was an overlap with company law, it may be worth looking into the point Deputy Peadar Tóibín made. As Acting Chairman, I am just being helpful. I do not know whether I have transgressed my role as Acting Chairman.
To be helpful, my intention was to suggest we should look into it.
I sensed that, which is why I am making the comment.
I move amendment No. 89:
In page 274, line 40, to delete “or at such other place as the directors think fit”.
This is another effort to ensure compliance. This amendment would restrict the holding of all returns to the company office. It is an effort to maintain high standards, accountability and ease of access to records for the authorities of the State.
On the face of it, the amendment makes sense, but in the age of cloud computing and remote servers it would place an imposition on businesses because the amount of physical storage facilities they would have to make available could be restrictive if located in city centre locations, for example. Many small offices are located in city centre locations where space is at a premium and would be unable to cope with storing the volume of records that would require to be stored. The amendment would substantially hinder or block outright the use of shared service centres, an area in which Ireland has a particular interest. Since there would be no tangible benefit for any stakeholder and it would be detrimental to Irish commerce, the amendment is - I do not want to use the word "undesirable" - not one we support.
Question, "That the words proposed to be deleted stand", put and declared carried.
Amendment declared lost.
I move amendment No. 90:
In page 278, lines 18 and 19, to delete all words from and including “assets,” in line 18 down to and including “loss—” in line 19 and substitute the following:
“assets, liabilities and financial position, as at the end of the financial year, and profit or loss, for the financial year—”.
This is a helpful clarification to ensure the section is consistent with the requirements outlined in the Companies Act 1963. It provides that individual and group accounts shall give a true and fair value of the assets at the end of the financial year and the profit or loss for the financial year for both the company and the group.
I think it is a "true and fair view" rather than a "true and fair value", is it not?
It is a "true and fair value."
Is it? It has moved on since my day.
I have three people here who will back me up.
Amendment agreed to.
I move amendment No. 91:
In page 301, line 31, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 92:
In page 301, line 32, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 93:
In page 301, line 35, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 94:
In page 301, line 38, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 95:
In page 301, line 41, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 96:
In page 302, line 6, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 97:
In page 302, line 10, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 98:
In page 302, line 13, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 99:
In page 302, line 15, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 100:
In page 302, line 17, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 101:
In page 302, line 21, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 102:
In page 302, line 23, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 103:
In page 302, line 32, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 104:
In page 303, line 4, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 105:
In page 303, line 25, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 106:
In page 303, line 27, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 107:
In page 303, line 30, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 108:
In page 303, line 36, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 109:
In page 303, line 39, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 110:
In page 303, line 42, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 111:
In page 304, line 3, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 112:
In page 304, line 6, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 113:
In page 304, line 9, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 114:
In page 304, line 13, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 115:
In page 304, line 32, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 116:
In page 304, line 34, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 117:
In page 305, line 2, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 118:
In page 305, line 4, to delete “bank’s” and substitute “institution’s”.
Amendment agreed to.
I move amendment No. 119:
In page 305, line 7, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 120:
In page 305, line 8, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 121:
In page 305, line 10, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 122:
In page 305, line 11, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 123:
In page 305, line 19, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 124:
In page 305, line 26, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 125:
In page 305, line 27, to delete “bank’s” and substitute “institution’s”.
Amendment agreed to.
I move amendment No. 126:
In page 305, line 30, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 127:
In page 305, line 31, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 128:
In page 305, line 33, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 129:
In page 306, line 33, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 130:
In page 306, line 36, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 131:
In page 306, line 42, and in page 307, line 1, to delete “licensed bank” and substitute “credit institution”.
Amendment agreed to.
I move amendment No. 132:
In page 307, line 1, to delete “bank” where it secondly occurs and substitute “institution”.
Amendment agreed to.
I move amendment No. 133:
In page 307, line 6, to delete “bank” and substitute “institution”.
Amendment agreed to.
I move amendment No. 134:
In page 313, to delete lines 14 to 19 and substitute the following:
“(a) shall be shown in the company’s entity financial statements as a deduction from the company’s capital and reserves (and the profits available for distribution shall accordingly be restricted by the amount of such deduction); and
(b) shall be shown in the company’s group financial statements, if any, as a deduction from group capital and reserves.”.
This is a minor technical amendment which the Parliamentary Counsel deems necessary.
Amendment agreed to.
I move amendment No. 135:
In page 313, to delete lines 20 to 26 and substitute the following:
“(2) Where a company, or a nominee of the company, holds shares in its holding undertaking or an interest in such shares, the profits of the company available for distribution shall be restricted by the amount of the consideration paid for such shares or interest.”.
Amendment agreed to.
I move amendment No. 136:
In page 325, line 19, to delete “subsections (3) to (6)” and substitute “subsections (3) to (5)”.
Amendment agreed to.
Amendments Nos. 137 to 140, inclusive, 142, 143, 199, 200, 233, 234, 249, 250, 256, 257, 259, 260, 262 and 263 are cognate and may be discussed together.
I move amendment No. 137:
In page 334, line 18, to delete “shall appear in typeset, and not written, form” and substitute “, and any date or dates thereon, shall appear in typeset form”.
The purpose of these amendments is to consolidate sections 3 and 4 of the Companies (Miscellaneous Provisions) Act 2013 into this Bill. Sections 3 and 4 provide for the electronic filing of documents with the Companies Registration Office.
Amendment agreed to.
I move amendment No. 138:
In page 334, line 25, after “signature” to insert “or of a date”.
Amendment agreed to.
I move amendment No. 139:
In page 336, line 11, to delete “shall appear in typeset, and not written, form” and substitute “, and any date or dates thereon, shall appear in typeset form”.
Amendment agreed to.
I move amendment No. 140:
In page 336, line 18, after “signature” to insert “or of a date”.
Amendment agreed to.
I move amendment No. 141:
In page 337, line 23, to delete “(6)(c)” and substitute “(6)(a)”.
Amendment agreed to.
I move amendment No. 142:
In page 338, line 32, to delete “shall appear in typeset, and not written, form” and substitute “, and any date or dates thereon, shall appear in typeset form”.
Amendment agreed to.
I move amendment No. 143:
In page 338, line 39, after “signature” to insert “or of a date”.
Amendment agreed to.
I move amendment No. 144:
In page 342, line 1, after “Registrar” to insert “a copy of”.
Amendment agreed to.
I move amendment No. 145:
In page 342, lines 20 and 21, to delete all words from and including “The” in line 20 down to and including “signing;” in line 21 and substitute the following:
“With respect to the statutory auditors’ special report referred to in subsection (1) (a copy (as that expression is to be read in accordance with section 353(5)) of which is to be delivered to the Registrar), the original of that report shall be signed by the statutory auditors and bear the date of such signing;”.
Amendment agreed to.
I move amendment No. 146:
In page 345, lines 16 to 18, to delete all words from and including “(1) A” in line 16 down to and including “company.” in line 18.
The purpose of the amendment is to ensure this exemption which aims to provide small indigenous Irish companies with audit exemptions is not inadvertently given to a small Irish parent company with substantial non-Irish subsidiaries. The proposed amendment deletes subsection (1) which implies that an Irish company with substantial foreign holdings would benefit from the exemption. The policy intention behind the audit exemption is to give benefit to small indigenous companies.
Amendment agreed to.
I move amendment No. 147:
In page 348, line 25, after “undertakings” to insert “(but this paragraph is subject to subsection (6))”.
The purpose of this amendment is to make provision for the fact that foreign subsidiaries in a group do not have to file annual returns in the CRO. This amendment is linked with the amendment to section 360.
Amendment agreed to.
I move amendment No. 148:
In page 349, between lines 16 and 17, to insert the following:
“(6) There shall not be reckoned as a subsidiary undertaking for the purposes of this section (other than for the purposes of the expression “subsidiary undertakings” in subsection (2)) an undertaking that is not a company registered under this Act or an existing company and the construction provided for by subsection (1)(a) (of references to each of the relevant bodies) shall be read accordingly.”.
Amendment agreed to.
I move amendment No. 149:
In page 378, between lines 10 and 11, to insert the following:
“(2) For the avoidance of doubt, in the case of a mortgage or charge created over both—
(a) an interest in anything specified in any of paragraphs (a) to (d) of subsection (1); and
(b) any property, assets or undertaking not falling within any of those paragraphs, the mortgage or charge shall, other than to the extent to which it is created over an interest in anything specified in any of the foregoing paragraphs of subsection (1), be regarded as a charge within the meaning of this Part.”.
Amendment agreed to.
Amendments Nos. 150 and 151 which are related are being discussed together.
I move amendment No. 150:
In page 381, to delete lines 17 and 18 and substitute the following:
“(a) Form 60, 60A or 60B set out in the Schedule of Forms to the Land Registration Rules 2012 (S.I. No. 483 of 2012) as amended by the Land Registration Rules 2013 (S.I. No. 389 of 2013), or”.
The purpose of the amendment is to address any ambiguity there might be as regards the definition of a charge. This section reflects the intent, namely, that charges over cash, deposit accounts, shares, securities and other items listed would not require registration. As the Bill stands, the language is ambiguous, as it could mean that a mortgage or charge, which could involve a number of assets, including, say, one of the excluded ones such as cash, does not have to be registered at all. This was not intended.
Amendment agreed to.
I move amendment No. 151:
In page 381, to delete lines 27 to 41, and in page 382, to delete lines 1 to 10 and substitute the following:
“(6) If rules are made under section 126 of the Registration of Title Act 1964 or, as the case may be, section 48 of the Registration of Deeds and Title Act 2006—
(a) replacing a form that is referred to in subsection (4)(a)* or (b), as appropriate, the reference in that provision to the form shall be read as a reference to the form as so replaced, or
(b) amending a form that is so referred to, the reference in that provision to the form shall be read as a reference to the form as it stands so amended.".
As the Bill stands, the reference to form 112 is incorrect since the Land Registration Rules 2012 came into effect. The relevant form is now form 60. The purpose of amendment in deleting subsection (6) is to clarify that the priority of judgment mortgage is governed by the Land and Conveyancing Law Reform Act 2009. Closer inspection has shown that in order to achieve the desired result, subsections (7) and (8), both of which relate to subsection (6), also needed to be deleted.
Debate adjourned.
Amendment agreed to.