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Seanad Éireann debate -
Tuesday, 4 Oct 1988

Vol. 121 No. 3

Companies (No. 2) Bill, 1987: Report and Final Stages.

An Leas-Chathaoirleach

Before we commence Report Stage I want to inform the House that the following amendments have been ruled out of order: amendments Nos. 5, 24, 25, 41, 42 and 59, as they do not arise out of Committee Stage proceedings and amendments Nos. 30 and 58 as they are similar to amendments rejected on Committee Stage. I should also like to remind the House that the proposer of an amendment may close the debate on that amendment but no other Senator may speak more than once on each amendment. I have arranged for a list of the proposed groupings of the amendments for the debate to be circulated for the information of Senators.

It is with some reluctance that I ask the House to consider going back into Committee so that we can discuss amendment No. 5. I know it is very rare, and perhaps unique, for the House to do so and it is with some considerable reluctance that I ask the House to consider this. It seems to me that the departure in section 10 (5) from existing legislation is, very dubious and, I am advised, perhaps unconstitutional. I believe this provision is a serious defect in the Bill.

I am not going to speak at length here, but I would like to remind the House that in a recent talk on Part II of the Bill Mr. Justice Ronan Keane of the High Court expressed serious doubts as to whether the investigation conducted by the inspector, even where he is appointed by the High Court, can properly be described as the administration of justice. I think an excellent job has been done on this Bill in this House; therefore, it is only appropriate that I would bring this matter to the House. In the course of that lecture Mr. Justice Keane, who is also, of course, President of the Law Reform Commission; states: "To describe the investigation as part of the administration of justice in these circumstances seems inappropriate and none of the reasons which moved——

An Leas-Chathaoirleach

Senator, perhaps I can explain. If this motion is opposed, under Standing Order 91 the Chair allows the proposer to make an explanatory statement of the reasons for the proposed recommittal and a statement from the Senator who opposed the motion before the question is put. It is not really appropriate to make a speech on the substance of the section involved.

Is it in order for other Senators to indicate support for Senator Kennedy's request and that this matter be recommitted to a brief Committee Stage? I think he has made a very valid point on this very complex Bill.

An Leas-Chathaoirleach

The Chair would be very lenient so long as there would be brevity all round. First of all, I must find out whether the motion is opposed.

It is opposed.

For clarification, is it just this amendment?

An Leas-Chathaoirleach

Yes.

So it would not——

I appreciate fully the points put by Senator Kennedy. However, I believe we have got to move forward. Committee Stage has been in the Seanad since October 1987 and it has been one of the most extensive Committee Stages, I believe, in the history of the House. At this point we are not in favour of having another Committee Stage debate on this matter. However, I would point out that Senator Kennedy's party can bring these points forward in the Dáil. Therefore, I regret to say we must oppose another Committee Stage debate at this point.

I am grateful for the opportunity to support the request by Senator Kennedy to have the House revert to Committee Stage so that he could expand on the reasons for this amendment. I must say the outline case he has made has a great deal of validity. I am aware that this Bill has to go through the Dáil and there will be an opportunity at that stage to consider any possible amendment on Committee Stage in the Dáil. Although it is true that we have spent a considerable amount of time in the Seanad on this Companies (No. 2) Bill, it is a very complex Bill that has required to be amended and the Government have submitted a significant number of amendments to the Bill.

I positively welcome that development. It happened in the previous Seanad in relation to the Status of Children Bill and the National Monuments Bill, and it is extremely important that there would be a certain flexibility on complex legal measures. I was just hoping we would have that flexibility only in relation to this amendment on Committee Stage today. I do not think it would take very long or hold up Report Stage today, and I think it would be a welcome sign that the Seanad had really addressed the issues in this Bill which has been introduced into the Seanad in an important way.

An Leas-Chathaoirleach

The Chair would prefer to put the question at this stage because——

Let me intervene briefly because I have been involved in this Bill throughout its duration in the Seanad and I think what Senator Kennedy is asking for is in keeping with the spirit in which this legislation has been debated throughout its duration here. I appeal to the House for a time limit, perhaps, to be put on this amendment No. 5 so that it can be put before the House and debated briefly before it passes from this House. It is not enough to say in this House that the matter will be discussed in the Dáil because, unfortunately, as Senators we will not be in the Dáil to discuss the matter there. I appeal to you, a Leas-Chathaoirligh, and through you to the Government party, to reconsider their decision to oppose this matter.

We all agree that this is a tremendously complex and difficult Bill and we appreciate the length of time it has been on Committee Stage etc. Nevertheless when one considers that we may not be looking at this law again for about 25 years, we should take every opportunity we can to make sure we get it as right as possible when we have the opportunity to do so. I think it would not take all that much time to put it into Committee.

The debate on this Bill in this House has been conducted in the spirit in which debates on legislation ought to be conducted and, let it be said, in a tone of responsibility of commitment which bears no relation to the perhaps personal benefit in terms of political benefit of either the Minister or the Members of this House. It is not something for which they will get much credit or notice. However, because of that spirit I am disappointed that this request by Senator Kennedy is being opposed on the Government side. It is not the spirit in which I have observed the Minister in particular to handle this debate over almost years, at this stage, of our time and it surprises me.

If there had been a request to recommit the whole of Report Stage the Government would have been perfectly right and I would have supported them but one amendment which I think is indisputably of considerable significance being recommitted for a relatively brief time would not disrupt the time of the House or the objective, which is to get this Bill out of Seanad Éireann, I presume this week, if not today. It would not in any way inhibit the objectives of the Government but would allow a serious and, arguably, fundamental defect in the Bill to be addressed. I do not think it will look particularly well for this House if a Bill, which perhaps is clearly identified as being defective, is passed out of this House simply because we cannot agree to use the procedures available to introduce an amendment that perhaps is of fundamental importance. That is why I regret the Government's apparent opposition and I appeal to them to reconsider it.

The spirit of the debate has been that people have listened to the arguments and to each other, and when a good case was made people on both sides should be prepared to change their minds to meet a point being made by somebody else, because there are not sides on this issue. It is a collective exercise of Members of all sides of the House. Therefore, there is no need for anybody to feel that he or she somehow has to hold up a side. It is an important issue, an important amendment and ought to be able to be taken. That is why I support Senator Kennedy.

I had not intended to speak at all. This is a complex piece of legislation and I have only contributed sporadically. However, I have listened very attentively to the monitor in my own room and I have just heard this section of the discussion on the monitor in the adjoining room.

I must say I believe that the Senators on this side of the House have produced very cogent reasons for this unusual procedure, and in the light of the fact that the Minister has shown a very considerable willingness to accept improvements in the legislation after very detailed and sophisticated discussion, I would like to add my voice to those appealing to the Government to allow this manoeuvre to take place in order that the Seanad may fulfil its appropriate function of assisting with professional insight into the workings of the legislation. I say this with particular force because it appears that the argument has been introduced that the advice of a very senior member of the Judiciary is that, if this Bill is passed as it currently stands, it will be found subsequently to be defective. I would like just simply to add my voice to those on this side of the House to urge the Government to reconsider the position in this matter.

I thank you for allowing me to contribute to this part because technically this is a matter for the House and I appreciate your giving me permission to say a few words on it.

We got this amendment yesterday afternoon. I thank Senator Kennedy for his research and his work in putting it together. Certainly it is a credit to his research. My legal advice is that the present wording is all right but I am quite happy to go back to the Attorney General's office and discuss this aspect with him. There are suggestions here of constitutional difficulties and I will certainly discuss that with the Attorney General's office but I could not do it overnight because it is such a complex area. I think it is a good idea that I do so between now and the time the Bill goes to the Dáil. I do not see much point in our going back to Committee Stage to debate something that I am not really in a position to accept until I have further detailed discussions with the Attorney General's office because, as I have said, there are constitutional issues involved. The Bill will go to the Dáil and quite possibly back to the Seanad again. It has been under discussion for a year already and I think it is important that we move on now as quickly as possible.

An Leas-Chathaoirleach

The question is: "That the Bill be recommitted in respect of amendment No. 5."

First, I wish to thank the Minister for his response. If we had the opportunity to briefly discuss the amendment, this side of the House would not move the amendment. We want to put the reasons for tabling this amendment on the record of the House. In view of what the Minister has said, that he is prepared to discuss the matter with the Attorney General, we would not put it to a vote in this House. All we want is a very limited time, perhaps ten minutes or 15 minutes, for discussion so that the Members of the House can put their views on this matter.

An Leas-Chathaoirleach

The question is: "That the Bill be recommitted in respect of amendment No. 5."

Question put.
The Seanad divided: Tá, 15; Níl, 23.

  • Bradford, Paul.
  • Connor, John.
  • Doyle, Joe.
  • Ferris, Michael.
  • Harte, John.
  • Hogan, Philip.
  • Kelleher, Peter.
  • Kennedy, Patrick.
  • Loughrey, Joachim.
  • McCormack, Pádraic.
  • McMahon, Larry.
  • Norris, David.
  • O'Shea, Brian.
  • Robinson, Mary T. W.
  • Ryan, Brendan.

Níl

  • Byrne, Seán.
  • Cassidy, Donie.
  • Cullimore, Séamus.
  • Doherty, Michael.
  • Eogan, George.
  • Fallon, Seán.
  • Farrell, Willie.
  • Fitzgerald, Tom.
  • Fitzsimons, Jack.
  • Haughey, Seán F.
  • Hillery, Brian.
  • Hussey, Thomas.
  • Lanigan, Mick.
  • Lydon, Donal.
  • McGowan, Patrick.
  • Mooney, Paschal.
  • Mullooly, Brian.
  • Mulroy, Jimmy.
  • O'Callaghan, Vivian.
  • O'Connell, John.
  • O'Toole, Martin J.
  • Ryan, William.
  • Wallace, Mary.
Tellers: Tá, Senators Doyle and Loughrey; Níl, Senators W. Ryan and S. Haughey.
Question declared lost.

I move amendment No. 1:

In page 11, line 22, after "writings" to insert ", computerised data".

This is a technical amendment to allow for the fact that there are means of keeping records apart from those outlined in the Bill. In an electronic age we should recognise that records are stored on computer and therefore the Minister could accept this amendment as it is in order to accommodate any form of record that might arise.

I second the amendment.

This point as to whether the definition of books and documents was sufficiently widely drawn to cover computerised records was raised on Committee Stage. At the time I undertook to re-examine the matter. The effect of this amendment would be to include specifically the phrase "computerised data" in the definition of books and documents. As I explained on Committee Stage, I am satisfied that the phrase "records made in any other manner" would include computerised data. Therefore, I do not see the necessity for this amendment.

There is the further point that inserting the phrase "computerised data" would itself be limiting in that other means of keeping records already exist which would not be covered by this phrase, for example, micro film and so on. Moreover, new means of storing records are likely to be developed in the future and it was for that reason that we used the phrase "records made in any other manner" since we were confident this would include all such means of keeping records. I know what the Senator is trying to do but it is not necessary.

We discussed this on Committee Stage. Has the Minister any advice available to him as to how the definition of records etc. in this Bill sit together with the Data Protection Act in so far as it applies to certain forms of records and there could be an overlap? I am not trying to trip the Minister up but it seems that the Data Protection Act, in so far as it might apply to certain records referred to here, might have implications for the operation of company law. It would be helpful at some stage, if not at this stage, if the legislation in relation to rights and privileges in something as complex as company law and that in regard to rights and privileges under the data protection legislation were made to fit together properly.

I am told that there are very elaborate definitions of data in that Bill but that there is no specific reference to computerised data. This is the interpretation section of a Companies Bill and the objective of the interpretation is to ensure that when we talk of books and documents we also include records made in any other manner. That is the single objective. I did not focus on the necessity or otherwise of dealing with the whole area of computerised data. I am satisfied on this amendment that including the phrase "records made in any other manner" is a better way of achieving the objective which the Senator wants to achieve because "computerised data" is too limited a phrase.

I am disappointed that the Minister did not accept the amendment, but if he is satisfied that the phrase "records kept in any other manner" would cover computerised data, I have no objection to his interpretation of that. I am not asking the Minister to delete the words "or records made in any other manner." I am merely asking him to include, under the definition of books and documents, computerised data and records made in any other manner. I want to ensure that computerised records are specified in the legislation and that we are sure that they are included in the definition of this Bill. If the Minister does not want to accept the amendment I will not push it to a vote if he is convinced that computerised data are covered under the phrase "records made in any other manner."

Amendment, by leave, withdrawn.

I move amendment No. 2:

In page 11, between lines 30 and 31, to insert the following:

"‘a member of a company' means a person who holds shares in a company."

I have noticed that in the definition section of the Bill there is no definition given as to what we mean by a member of a company. Normally what we mean by a member of a company is a person who holds shares in that company, but there might be some confusion in that in certain situations it could mean the director of a company. The words "shareholder" might be used where the member of a company is meant, and management of a company might be interpreted as a member of a company. We should be clear on what we mean by the phrase "a member of a company" which is a phrase used often throughout the Bill. We should define that at the beginning of the Bill in order to ensure that we know what we mean when we mention that phrase throughout the Bill.

I second the amendment for the purposes of the discussion. I thought that once it was seconded on the Order Paper it did not have to be seconded in the House.

This amendment seeks the inclusion of a definition of the phrase "a member of a company" in the interpretation section of the Bill. My reaction is that the amendment is unnecessary. Indeed, it could prove to be counter-productive in some cases. Let me make it clear that a director of a company is not automatically a member of the company. This seems to have been the impression of some Senators during the Committee Stage debate. Of course if the director is also a shareholder that would obviously make him or her a member. As to who the membership of a company are, to begin with section 31 (1) of the 1963 Act provides that the initial subscribers to the memorandum of a company are deemed to have become members of the company.

Section 31 (2) provides that a person who agrees to become a member of a company and whose name is entered on its register of members is also a member of the company. Therefore, every person who notifies his or her shareholding to the company and is included on the member's register is also automatically a member. However, while it is true that every shareholder of a company would thus be a member, we have to bear in mind that not all companies actually have a share capital. I am thinking of companies limited by guarantee. These would normally be non-profit making companies of one kind or another. Section 5 (2) (b) of the 1963 Act defines a guarantee company as a company having the liability of its members limited by the memorandum to such amount as the members may respectively undertake to contribute to the assets of the company in the event of its being wound up.

The House should appreciate, therefore, that it is not simply a matter of saying, as the amendment does, that a member equals a shareholder. At the same time as I understand it, it is well established in law as to what a member of a company is. I am not aware that there is any confusion on the point. In the circumstances I do not see the proposed amendment as being necessary. As I hope I have explained I think it could actually prove to be misleading. For that reason I would oppose it.

Amendment, by leave, withdrawn.

We now come to amendment No. 3. Amendment No. 4 is an alternative and both may be discussed together.

I move amendment No. 3:

In page 13, line 13, to delete "not exceeding £200,000" and substitute "not less than £5,000 in cash".

The reason I seek the inclusion of amendments Nos. 3 and 4 is that there is a danger that if we do not put in a provision to stop frivolous claims being made we could end up with a lot of court procedures that are unnecessary. The only people who will complain will be the shareholders or creditors. They are the people most likely to bring a case under this section. In order to prevent frivolous claims being made we should include an amendment which would put cash on the table rather than include the phrase "not exceeding £200,000" mentioned in subsection (3) because somebody could use a bond as security and it is possible to get an insurance bond much cheaper than the amount mentioned in the Bill. If we want to prevent frivolous claims being made under this section, we should seek some cash being put on the table before entertaining any claims or court procedures under this section.

I support this amendment. In seconding the amendment I would like to say that it relates to the subsection of section 7 dealing with security for the payment of the costs of the investigation. Is there an express power to award costs against the person who has triggered off the investigation? If not, it should be included. It relates to the giving of security to an amount not exceeding £200,000 for the payment of the costs of the investigation made under sections 7 or 8 but it does not give the court an express power to award costs. I would like to be assured that the court would have the power in appropriate circumstances to award costs and I await the Minister's reply to the point made by Senator Hogan.

The first thing I should say is that I would be opposed to the Senator's first amendment, amendment No. 3, since that in effect would have the opposite effect to the one the Senator intended. If there were to be no upper limit on the amount of security which the court would require, there would be nothing to stop the court requiring security of £1 million or, indeed, any other figure we care to mention. I would not suggest for a moment that the court would go anywhere near that figure in any given case. At the same time, we should have some finite limit to it. That is why we have come up with that figure.

If we accept that there should be some upper limit, we then have to decide what that figure should be. In that context I explained at some length on Committee Stage that the figure of £200,000 in the Bill is a maximum figure and that the court could well decide that a much lower figure should apply in any given case or, perhaps none at all if the circumstances warranted it. So they may go for no figure at all, as it were. At the same time, I would like to make one thing clear. An investigation under the Companies Act is a very serious matter and experience to date suggests that it is very expensive to mount. What tends to happen is that, because of the complexities of the matters usually encountered, those involved feel the need for legal representation and expert witnesses and so on can become necessary. All of this, plus the fact of getting to bottom of whatever wrongdoing or other problem is alleged to have occurred, can actually take a long time with the meter running, as it were, all the time.

The House will gather from this that I do not see such formal investigations being an everyday occurrence; far from it. In fact, I think, they would only arise in exceptional and serious circumstances in which serious wrongdoings were suspected. These are the main reasons I felt on Committee Stage, and still feel, that a high upper limit is required here. I should also mention that in sections 19 to 21 of the Bill we are giving the Minister considerable powers to get information directly from companies without the need to set out on the more expensive route of a formal investigation. This adds weight to my view that, because of the scale and seriousness of such formal inquiries, the scale of security involved should match the seriousness and gravity of the matter. For that reason I cannot accept amendment No. 3.

With regard to Senator Robinson's point, I understand that we are acting on the basis that the court has a general power to award costs without it being necessary for us to put it in the Bill.

I appreciate what the Minister of State has said. I believe that the amount of security required is unnecessarily high. For this reason I think it could act as a deterrent to the initiation of an investigation. That is my main concern about the amount. I imagine that there are grounds for reducing the amount substantially. Therefore I support the amendment.

Acting Chairman

Is the amendment withdrawn?

While I realise there is an upper limit, which with hindsight might be desirable, nevertheless, the principle which I am trying to establish, the elimination of frivolous claims is worthy of consideration. If the Minister of State indicates to me that consideration will be given by himself and his Department to this matter before it goes to the Dáil it might help me in deciding on whether to call a vote.

I am happy to consider every line of this Bill before it is formally approved by Dáil Éireann and by Seanad Éireann. I will certainly keep an eye on all of these matters. I do not know whether there is much scope to move very far on this because it is desirable to have an upper limit. I am sure the court will not entertain too many frivolous claims.

Amendment, by leave, withdrawn.
Amendment No. 4 not moved.

Acting Chairman

Amendment No. 5 has been ruled out of order.

Amendment No. 5 not moved.
Government amendment No. 6:
In page 15, line 36, after "person", to insert "(including an employee)".

Senator O'Toole tabled an amendment on Committee Stage which, if accepted, would have inserted a new subparagraph in section 11 (3). He wanted to include any employee of the company or trade union representing employees in a company as parties who were entitled to be furnished with a copy of the inspector's report. In the debate on Committee Stage a number of other Senators supported Senator O'Toole's proposal.

In responding to the proposed amendment I indicated that I was happy that the subsection (3) (b) (v), which refers to any other person whose financial interest appears to the court to be affected by the matters dealt with in the report, whether as a creditor of the company or body corporate or otherwise, would normally include employees of the firm. I should like to make it clear that it was never our intention to prevent employees from being able to obtain a copy of the report of an investigation and, having reconsidered the matter and the points made by Senator O'Toole and others, I am prepared in amendment No. 6 to make this explicit. In my view the amendment meets the points made by Senators in the debate.

I should like to thank the Minister and I am sure Senator Joe O'Toole would like me to do so on his behalf. It is now clearly recognised that employees will make a contribution in the legislation before us. It is important to stipulate the type of people permitted to carry out investigations. To recognise the position of an employee in the Bill is an improvement on the original wording.

I should like to express my appreciation of the Minister's efforts in regard to this point.

Like other Senators I welcome the fact that the Minister has taken Senator O'Toole's suggestion on board. It is important that he should clarify, on behalf of persons referred to in subsection (v) who now include employees, what the prescribed fee is likely to be in relation to a report. The report will be furnished if the court thinks fit and in that context I should like to know if it will be necessary to make an application to the court. If that is the case that would involve more expense. Is the Minister in a position to say what the prescribed fee is likely to be? One must clear a double hurdle in regard to this in that the court must be of the opinion that a copy should be furnished and there must be a payment of the prescribed fee.

The "prescribed fee" will be laid down by regulation. At this stage I am not in a position to give the Senator an idea of what the prescribed fee will be but I assume it will be reasonable.

Amendment agreed to.

Acting Chairman

Amendments Nos. 7 and 8 are related and may be discussed together.

I move amendment No. 7:

In page 16, line 20, after "liable" to insert "to pay the said expenses on account or".

This amendment relates to the expenses involved in the investigation of a company's affairs that may be carried out by a specific firm. If the investigations are carried out over a long period of time a firm may not receive any expenses for such work from the appropriate body, the Department of Industry and Commerce in this case. In my view we should insert a provision for payment on account to ensure that the firm carrying out the investigations is not put into financial difficulties as a result of the work. There should be flexibility in regard to the payment of expenses.

I should like to second the amendment.

Senator Hogan and I share a certain amount of common ground on this in that we both agree that the whole question of who pays the expenses of an investigation of a company under Part II should be made clearer in the text of section 13. Unfortunately, Senator Hogan's wording fails to do that. The expression, "on account", which the Senator used in this amendment is not defined and it could have a whole range of different meanings. For example, it could mean that the applicant would only have to pay the expenses of the investigation as they arose, in other words, on an ongoing basis, or it could mean that he would only have to pay when presented with some type of final account at the end of the investigation. On the other hand, a further possible interpretation is that he would have to pay the full amount of his security in cash up-front before the investigation got underway. For those reasons I have to reject the amendment as it is worded since it will only confuse the picture.

Government amendment No. 8, on the other hand, seeks to address the issue raised on Committee Stage, that we should make it clearer in subsection (2) as to the absolute maximum amount the applicant for an investigation could be required to pay. That amendment proposes to make it clear in the subsection that if the other parties listed in subsection (1) (a) and (b) defaulted the original applicant could not be required to pay a penny more than the amount he was initially required to secure. Amendment No. 8, while admittedly adding to the length of the subsection, helps to remove any doubt that the original wording may have created.

Amendment, by leave, withdrawn.
Government amendment No. 8:
In page 16, line 28, after "pay", to insert "but not exceeding, in aggregate, the amount of the original security they were required to pay under section 7 (3)".

This amendment clarifies the question of the liability, or possible liability, of applicants but I have a minor drafting suggestion to make to the Minister which is that it should, perhaps, be the amount of the original security required to be given under section 7 (3). They were not required to pay at that stage but were required to give the security. I support the amendment.

May I make a comment on this amendment?

Acting Chairman

Amendments Nos. 7 and 8 were discussed together and I am putting amendment No. 8 to the House.

I do not follow the ruling of the Chair but I will obey it.

Amendment agreed to.

I move amendment No. 9:

In page 33, line 29, to delete "£2,500" and substitute "£5,000".

This amendment deals with the exceptions from section 31 and seeks to increase the aggregate of the relevant amounts to £5,000. In my view £2,500, the figure included in the Bill, is a very small amount when considering the amount of loans that may be given to a company. A figure of £5,000 is more realistic when one considers the amount of money a director may need in the form of a loan.

I second amendment No. 9.

This is one of the matters I undertook to consider before Report Stage. I have given it quite a lot of thought in the meantime but, having looked at what the Senators said on Second and Committee Stages in regard to the figure of £2,500, I am not convinced that we should make the change suggested. I should like to remind the House that what we are talking about is the question of a company lending its creditors' money to one of the directors for some personal use.

It is important that we are clear about what we are talking about in regard to loans. The central idea behind the prohibition in section 31, as I said on Committee Stage, is that a director should not use his company as his personal bank. That is on the basis that if a director's credit is good he or she should have no trouble in getting a loan from a lending agency and if it is not they certainly should not be going to the company instead. However, I stated that I would be willing to listen to reasonable arguments as to why the exemption limit of £2,500 in section 32 (3) should be increased but I did not hear such arguments made on Committee Stage. The overall reaction from Senators then was to welcome the prohibition in Part III in general and that the exemption limit of £2,500 was a bit on the low side and should be increased. I do not think that is sufficient basis on which to increase the figure and, having given it quite a bit of thought and bearing in mind the rationale behind what we are trying to do, I do not think I should agree to amend it. Either we want to permit this activity or we do not.

These issues of relative sizes are extremely important especially in relation to the perspectives from which they are addressed. It is reasonable to suggest that £2,500 sounds like a small sum, but it is worth pointing out that it is approximately what we expect one and a quarter million people to live on for a year. Perspectives as to what constitutes a large or a small sum of money vary from one point of view to another. As the Minister said there must be a question mark about a director of a company who cannot borrow money anywhere except from the company. In the interest of the customers and the creditors of the company such activity should be severely constrained. I am glad the Minister has decided not to accept this amendment. A sum of £5,000 is not the sort of money that most people would regard as a matter that could be left to be dealt with in a company without the constraints of the law being imposed. I am happy that the Minister is doing the right thing.

There might be an interpretation here that the director is going to steal £2,500 or £5,000 from the company. If that impression has been given I would like to refute it. This will be done with the knowledge of the company. The number of directors seeking a loan of £2,500 will be few and far between. The sum is so small that it will render the section useless and the section will not be put into effect on too many occasions. That might satisfy Senator Ryan, but it does not satisfy me.

Amendment, by leave, withdrawn.

I move amendment No. 10:

In page 34, line 28, to delete "six months" and substitute "such time as the company may prescribe".

I am trying to widen this section by including the words "six months" in relation to the repayment of the loan. We should not put undue restrictions in this and try to tell a company how long it should take for a director to pay a loan. It should be left to the company to decide their own terms in relation to repayment, taking into account the circumstances of the director at the time and the circumstances of the loan. A limit of six months is too restrictive.

An Leas-Chathaoirleach

Is the amendment seconded?

Senator Manning and I had considerable debate on this point during the Committee Stage. The Senator and other Senators were concerned that sections 32, 35 and 36 taken together might prove too cumbersome in practice and that it might hinder the perfectly proper activities of business people in a very competitive environment. I indicated at that stage that the last thing I would wish to do would be to inhibit the free flow of business but that there would be major difficulties standing in the way of widening the exemption involved here as was being suggested. Part III of the Bill puts in place certain prohibitions on the making of loans to directors. Against that background I do not want to widen the exemptions to a point where people can get around such a prohibition by getting a loan under another name.

I will reassure the House as to how this exception will operate. First, section 31 prohibits loans over a certain amount to directors. Section 32 (5) (c) says that these prohibitions will not apply where a company give their directors funds to be properly applied for company purposes. However, in order to make sure that this exception will not be abused, section 32 (6) contains a set of conditions, at least one of which has to be satisfied before the exception will operate. To begin with, the giving of the funds involved can get the prior approval of the company at any general meeting. If that is not done, the funds can still be approved after the event at any time up to and including the next annual general meeting after the funds are given. If no such approval is given by a general meeting the money must be repaid within six months after the AGM following the giving of the funds in the first place. The effect of amendment No. 9 would be to remove this time limit of six months so that in fact the money might never be repaid. That would lead to the very abuse we are trying to avoid, in other words, directors being given loans under another name. It is not unreasonable to ask that the giving of funds to directors in these circumstances should require shareholders' approval, particularly when we bear in mind the potential abuses that can be involved here. The house will gather that I am not willing to accept this amendment.

This legislation is designed to deal with a number of fairly widespread abuses of the concept of limited liability that have become all too frequent in business. The Bill also proposes to restore the concept of limited liability to what it is supposed to be — an incentive to risk taking, to enterprise and to encouraging people to set up business, taking reasonable risks under reasonable clearly defined commercial conditions. The objective of company law is to make it possible for people to set up and run businesses without taking risks which are disproportionate to the endeavour. It appears that many of those provisions have been abused and we are now trying to restore a balance. If Senator Hogan had argued for a different time limit I would have been prepared to listen but to eliminate the time limit is to fly in the face of the objective of the section, as it would leave a gargantuan loophole in an area where apparently even the tiniest of loopholes have been exploited in the past.

We cannot leave this open ended, although in a better world it might be possible to do so. We must remember that we are not talking about large multinational companies. Under this legislation we could be talking about family owned companies. It is not necessarily a publicly owned company with quoted shares on the Stock Exchange. Inside a family, views could be taken as to what was in the interests of a company and there must be some legislative protection for the employees and creditors and all the other people who depend on the proper running of the affairs of the company. I am not in favour of amendment No. 10 and I am glad that the Minister takes a similar view.

I listened carefully to the Minister and to Senator Ryan. Senator Ryan has alerted me to a possible loophole in relation to family businesses which could be affected by this amendment which I have proposed. The Senator made a very valid point and I agree that the opening up of the section could cause problems. However, I found that the six months time limit was extremely narrow and did not give much time for a director to repay the loan. Nevertheless, if a loophole could emerge in family business as a result of substituting my wording, I will withdraw my amendment.

Amendment, by leave, withdrawn.

Acting Chairman

Amendments Nos. 11 and 12 are related and may be discussed together.

Government amendment No. 11:
In page 47, between lines 7 and 8, to insert the following:
"(10) It shall be the duty of each director and secretary of a company to give information in writing to the company as soon as may be of such matters as may be necessary to enable the company to comply with this section."

On Committee Stage Senator O'Toole pointed out that while it was an offence for a company not to keep a register of directors under the section, there was no sanction on a director who failed to give the company the information in the first place. My immediate reaction at that time was that the balance in the section was right and I did not wish to place another duty on directors if we could avoid it. Against that, it appears to be invidious to be placing a burden on the company which they could not discharge in the absence of full information from the director concerned. That is why we prepared these two related amendments.

Amendment agreed to.
Government amendment No. 12:
In page 47, between lines 15 and 16, to insert the following:
"(12) A person who fails to comply with subsection (10)* shall be guilty of an offence and liable to a fine."

Acting Chairman

Amendment No. 12 has already been discussed with amendment No. 11. Is amendment No. 12 agreed?

I have a question on the drafting of this amendment. I understand that this is an appropriate reference that should refer to amendment No. 11, not to amendment No. 10; that is all. The footnote: "This is the appropriate reference if Amendment No. 10 is accepted" should refer to amendment No. 11, not to amendment No. 10.

Amendment agreed to.

Acting Chairman

Amendments Nos. 13 and 14 are related and may be discussed together.

I move amendment No. 13:

In page 51, line 20, to delete "five" and substitute "ten".

On Committee Stage we discussed the obligation of a director or secretary in making a report to notify interests in shares or debentures of a public limited company. It was generally agreed under section 51 that the period of time of five days in which this report would have to be completed was putting a tremendous pressure on the director or secretary in order to fulfil this obligation. Even though there is a period of time in which the overall investigation has to be completed, nevertheless ten days would be more appropriate for giving time to the director or secretary in order to make a much more full report, rather than five days, which is indicated under section 51 (1).

I formally second that.

Section 50, with which the two amendments deal, sets out the time limit within which the disclosure requirements relating to directors' and secretaries' holdings must be fulfilled. The purpose of the section is to ensure that the information as to the true ownership of shares will be up to date and, therefore, meaningful. The section provides that the notification obligations must be fulfilled within five days of a person becoming aware that he or she has acquired an interest. The present amendment is proposing that this period should be extended to ten days.

I have to say at the outset that I consider five days to be a reasonable time limit. It should be remembered that five days mean five working days by virtue of section 4 of the Bill. Thus a person will, in practice, always have a week to make the necessary notification. I consider that a longer time period would be of no practical use in many circumstances, particularly in public companies where shares can change hands on a daily basis, indeed much more quickly than that. I should point out finally that the obligation to notify arises only when a person becomes aware that he or she has acquired a notifiable interest. Therefore, there is no danger that a person would be under an obligation to notify without knowing that he had a notifiable interest. Therefore, I do not think these amendments are either desirable or necessary.

Acting Chairman

Senator Hogan to conclude.

The Minister might not find them desirable in his opinion but in order to give the necessary time to a director or a secretary to draw up a very full report on a very important matter in relation to the shares in a public limited company, it is desirable that enough time should be given to carry out that procedure to the fullest possible extent. It was referred to extensively and a number of Senators felt that a five days limit was too little. I am sorry to see that the Minister did not suggest that a period of five days was insufficient even on Report Stage here today. Perhaps he would reconsider in the future that something more than five days is necessary. Even though it is five working days within the meaning of the Bill, nevertheless it can put a very onerous burden on a director or secretary to have to come up with the necessary report and information within five days. I certainly will not press the issue at this stage.

Amendment, by leave, withdrawn.
Amendment No. 14 not moved.
Government amendment No. 15:
In page 55, lines 28 and 29, to delete lines 28 and 29 and substitute the following:
"(4) The information required by subsection (1) to be given in respect of the directors of the company shall also be given in respect of the person who was the secretary of the company at the end of the financial year concerned.".

Amendment No. 15 will replace subsection (4) of section 55, which itself was inserted on Committee Stage. That subsection currently reads:

This section applies to the secretary of a company as it applies to a director of that company.

The need of a further amendment was raised during discussion of the amendment on Committee Stage when Senator Robinson pointed out that the word "director" is used in two senses in the section, first, in a sense of the director's report and, secondly, in the sense of the duty to disclose certain information in that report. The Senator felt that if we applied the section to secretaries, as the Committee Stage amendment did, we might be creating confusion as to whether we are now introducing a new requirement for a secretary's report. That is clearly not what we want and amendment No. 15 would, I hope, clarify the point. I thank Senator Robinson for drawing it to our attention.

I would like to thank the Minister for having taken on board what, in fact, was a fairly technical amendment. The amendment now put forward does deal with the point and I support it.

Amendment agreed to.
Government amendment No. 16:
In page 67, lines 14 and 15, to delete "in the ordinary course of his business as such a person", and substitute "by the person or body concerned in the ordinary course of business of such person or body".

Amendment No. 16 is a technical drafting amendment and it is consequential on two related amendments which were made to subsection (4) of section 70 on Committee Stage. The first of those amendments gave a limited exemption to ACC, ICC and Fóir Teoranta on the same basis as the banking bodies which were already listed in subsection (4). The second Committee Stage amendment was consequential on this. However, Senator Robinson correctly pointed out that we had not gone on to make a consequential amendment to amend the phrase "as such a person" in the last line of paragraph (b) of subsection (4). Amendment No. 16 is really a minor but nonetheless important drafting amendment.

I would like again to thank the Minister. This substitution of the wording contained in amendment No. 16 deals with the point.

Amendment agreed to.

Acting Chairman

Amendments Nos. 17 and 18 are related and may be discussed together.

Government amendment No. 17:
In page 72, line 29, to delete "Part", and substitute "Chapter".

These two related amendments have to do with the scope of sections 78 and 79 of the Bill. Amendment No. 17 to section 78 (2) is really consequential on a similar amendment that we made on Committee Stage, when we substitute the word "chapter" for "part" in section 78 (1) (a). The reason is the same — to make it clear that there are different rules to apply to the register to be kept under chapter two of part IV, public companies only, as opposed to chapter one, directors' interests in all companies. Amendment No. 18 to section 79 (1) is related and arises for a similar reason, in other words, to make it clear that the section is referring to the register of interests in shares required to be notified under chapter two and not Part IV generally. It is a drafting amendment, also.

Although the Minister said it is a drafting amendment, it is a very welcome one. As the Minister said, it is very necessary to draw a clear distinction between the provisions that apply to public companies only and the provisions that apply to all companies. It reinforces a point that came up more than once on Committee Stage, that is, the necessity for a new explanatory memorandum when the Bill is published and perhaps even a further publication of the contents of the Bill. I am aware that it will be closely assessed by accountants and others with a particular expertise and lawyers with an expertise in company law, but we have very, very complex legislation here.

I am glad the Minister is taking the trouble to ensure that the parts and chapters that relate to different issues are carefully distinguished in the legislation but it will also require a good deal of explanation once the Bill has been passed and, perhaps, it would be helpful to have an explanatory memorandum before it is discussed in the Dáil. I am not sure if that is possible before it is actually published, but it has changed so much since its passage through the Seanad that that would be very welcome.

Amendment agreed to.
Government amendment No. 18:
In page 73, line 21, after "shares", to insert "under this Chapter".
Amendment agreed to.

I move amendment No. 19:

In page 74, to delete lines 23 and 24.

This amendment seeks to delete lines 23 and 24 on page 74. Section 82 deals with the exceptions that would be made to the disclosure order in public limited companies.

Under the present Bill societies registered under the Building Societies Acts, 1976 to 1984, are excluded from disclosure orders under this Bill. The reason I put down this amendment is that there is a veil of secrecy surrounding building societies which is certainly unhealthy. There seems also to be a great difficulty in getting substantial information on request from building societies, even from shareholders of building societies. It is inappropriate that people should protect building societies under any legislation. Under this legislation they will continue to have the necessary protection to withhold information as a public limited company and not disclose it to shareholders or people who are mortgage holders within that building society. The opportunity is here for the Minister to open up building societies under the Building Societies Acts, 1976 to 1984 and to ensure that disclosure orders are the order of the day rather than the veil of secrecy which we see surrounding them so much today.

Acting Chairman

Is the amendment seconded?

I formally second it.

Section 82 essentially sets out the scope of Chapter 3 of Part IV of the Bill, in other words the kind of bodies to which the special disclosure provision of the Chapter will apply. These disclosure requirements relate primarily to private companies. Obviously the main type of body to which Chapter 3 will apply will be the normal private company incorporated and registered under the Companies Acts. The subsection is, however, phrased in a negative way. In other words we say it shall apply to all bodies corporate other than those mentioned in paragraphs (a) to (d). This is to make the coverage as wide as possible but within the company law context. This is the only reason for the mention of building societies in the subsection. It was never our intention that the disclosure provisions should apply to building societies.

I pointed out on Committee Stage, this will be a matter for the Minister for the Environment and it would be totally inappropriate in companies legislation. Building societies and industrial and provident societies have a completely different raison d'être and organisational and capital structure in which the shareholding of a member does not have the same connotations as it does in the case of a company. It is, therefore, not appropriate that they should be covered in companies legislation and it is preferable that we continue the practice of dealing with such matters in building societies legislation.

The problem with building societies is that they do not apperar to be properly covered under any legislation. There is a curious ability on the part of various Minister to kick this issue from one Department to the other and fail to take on the building societies about disclosing information that might be required in the public interest and particularly in the interest of mortgage holders. The difficulty we have seen created in the past for people trying to get on the board of directors of building societies by various means at the disposal of the existing directors is very disturbing and something which I find distasteful. If building societies want to operate as bona fide financial institutions they should not be exempt from disclosure orders. If the Minister of State is saying this is inappropriate under the Companies Act, he has a duty to make appropriate representations to the Minister for the Environment expressing the genuine concern of the Seanad about the operations and the non-disclosure of information of building societies.

I did not realise Senator Hogan was going to reply so quickly on that point. He raises a serious point in this amendment. It was discussed on Committee Stage. I am concerned about the exemption from disclosure of building societies and indeed industrial and provident societies, in particular, because in the context now of the internal market these types of entities will be providing various ranges of financial services in competition with each other. It is important that we should have a similar type of control and disclosure provisions. I accept the Minister's point that it is not within his immediate jurisdiction in relation to the Companies Act. It is a matter that should be conveyed to the Minister for the Environment — the concern that similar controls and disclosure provisions should be introduced in relation to building societies and industrial and provident societies. It is in the public interest in particular because they have broadened their range of activities in the financial services area.

Acting Chairman

Is the amendment withdrawn?

On a point of information, could the Minister tell me why it is not appropriate to take this wording out of the Companies Bill?

The reason I did not reply Senator was not to be discourteous but because I understood that, on Report Stage, I was permitted to speak only once. I was really trying to be of assistance to Senators. I do not think it is appropriate to deal with what is, in effect, seeking disclosure on ownership of building societies in companies legislation. I think Senator Robinson is correct in regard to the medium term and how far away that is, is anybody's guess. The evolution of financial services, the breaking of barriers between banks and insurance companies and building societies and the breaking down of Chinese walls between companies and so on, all of that area is a whole new fresh area which will require that, where people play the same game, they play the same rules. I would imagine that the Minister for the Environment would be very conscious — and it has been brought to his attention on a regular basis — of the question of banks versus building societies and the various jobs they do. My view and I am sure the view of most people is that if you are playing the same games the rules should be the same. This is not the place to go into it.

Amendment, by leave, withdrawn.
Government amendment No. 20:
In page 75, lines 30 and 31, to delete "(whether actual or contingent)", and substitute "or contingent or prospective creditor (including an employee)".

The House will recall that on Committee Stage I accepted an amendment proposed by Senator O'Toole deleting paragraph (b) (ii) of subsection (5) which precluded the court making a disclosure order if it was made in contemplation or furtherance of a trade dispute. In the discussion on that proposed amendment however I said, among other things, that I was satisfied that section 83 (6) gave employees the right to apply for a disclosure order under the section. As with the other sections in the Bill I am now proposing to include a specific reference to employees by way of Report Stage amendments, in other words sections 113, 125, 135 and 145. I am prepared to make a similar amendment in this section which I think meets the point made by Senator O'Toole.

This is a welcome amendment. The matter was fully discussed on Committee Stage. It is helpful that there is an express reference to employee at this stage to remove any doubt as to whether an employee was covered.

Senator O'Toole is missing his moment of glory rather badly but he may have another moment of glory by Thursday morning I suspect. It is a welcome development that explicit reference to employees is being inserted into a number of sections of this Bill. It is one of the strange realities of much of our legislation that the group of people who are second to the owners and most vitally affected by the success or otherwise of a company tend to be at best implicitly referred to in legislation and, at worst, specifically excluded from the provisions of many areas of legislation. Therefore, it is most welcome. I cannot help commenting in passing on the extraordinary language of the subsection. I would love to hear the legal definition of a "co-adventurer" some time, not now.

Amendment agreed to.
Government amendment No. 21:
In page 82, to delete lines 35 to 40.

On Committee Stage Senator Ryan questioned the meaning and intention behind section 93 (1) (b). Following Committee Stage this is section 93 (2) (a). He saw this provision as a means whereby share dealing activities on behalf of employees of a company through investments by their pension funds could be exempted from the prohibition on insider trading. We are moving into that area now. On reflection, I agree with Senator Ryan that the exemption provided here for superannuation schemes, pension funds, and so on could indeed enable the people connected with the fund to use inside information to deal in shares. I agree that this would be undesirable and that the exemption should accordingly be deleted. That is what amendment No. 21 proposes, and I appreciate the Senator bringing it to my attention.

I thank the Minister. This is entirely in the spirit in which this whole Bill is being debated.

Amendment agreed to.
Government amendment No. 22:
In page 83, to delete lines 10 to 14 and substitute the following:
"95.—(1) Subject to subsection (2), a person convicted of an offence under section 94 or this section shall not deal within the period of 12 months from the date of the conviction.
(2) Where a person convicted of an offence under subsection (1) has, before the date of his conviction, initiated a transaction under which some element of performance remains to be rendered, subsection (1) shall not prohibit him from completing the transaction where a relevant authority of a recognised stock exchange has indicated in writing its satisfaction that—
(a) the transaction was initiated but not completed before the date of the conviction, and
(b) if the transaction were not concluded, the rights of an innocent third party would be prejudiced, and
(c) the transaction would not be unlawful under any other provision of this Part.
(3) A person who contravenes this section shall be guilty of an offence.".

This is a section which I introduced on Committee Stage, and arising from comments made by Senator Ross at that Stage amendment No. 22 would replace the section with an amended version. Section 95 essentially provides that where a person is convicted of insider dealing he will be prohibited from any other dealing for a period of 12 months from the date of the conviction. However, Senator Ross questioned whether the prohibition involved would affect situations where, for example, certain transactions had not been completed by the person concerned at the time of the conviction; in other words would transactions which had yet to be closed and which might be legally binding be affected? Senator Ross's point was that such a prohibition would create problems not only for the individual but also for the Stock Exchange and might lead to an undesirable disruption of the market. His suggested solution was that a phrase like "commenced deal" might be inserted in subsection (1).

On reflection it does seem to be the case that conviction under the section would impose a blanket prohibition on any further dealing by the convicted person. This would, as pointed out by Senator Ross, have a disruptive effect on the operation of the stock markets. This is not something we would wish to do. The proposed amendment would therefore enable the Stock Exchange concerned to give its clearance to transactions which were not completed at the time of the conviction, if the smooth operation of the market would otherwise be prejudiced. The exchange authorities would also have to be satisfied that any deal which was allowed to proceed in this way would not otherwise be unlawful under Part V of the Bill; in other words that it was not in itself a further case of insider dealing.

If the House is agreeable, perhaps we could make a consequential amendment here which unfortunately we overlooked tabling? It is, "In page 84, line 21, after ‘sections', to insert ‘95'."

Sections 95, 99 and 100. Again, on behalf of Senator Ross who could not obviously be here I think it is very welcome that the Minister has inserted this amendment arising out of the discussion. On the reference to an appropriate authority of a stock exchange, I assume that is sufficiently clear and I take it that the innocent third party could go some way to securing that confirmation from the appropriate authority of the Stock Exchange or would it be the convicted person in order to continue with the transaction who would secure the information from the relevant authority of the Stock Exchange? It might be the third party who really wanted the matter proceeded with in order to ensure that there was no default.

A person involved would go to the Stock Exchange with the case and we define the relevant authority on page 84, section 98 (6). I think it is crisp enough.

Amendment agreed to.
Government amendment No. 23:
In page 84, between lines 15 and 16, to insert the following:
"(5) If it appears to the Minister, arising from a complaint to a relevant authority of a recognised stock exchange concerning an alleged offence under this Part, that there are circumstances suggesting that—
(a) the relevant authority ought to use its powers under this Part but has not done so, or
(b) that a report ought to be made to the Director of Public Prosecutions under subsection (1), but that the relevant authority concerned has not so reported,
he may request the relevant authority to use such powers or make such a report, and on a report being made accordingly, this section shall have effect as though the report had been made in pursuance of subsection (1).
(6) Where the Minister makes a request under subsection (5), the relevant authority concerned shall communicate the results of its investigations, or a copy of its report under subsection (1), as the case may be, to the Minister.".

The purpose of amendment No. 23 is to give a residual power to the Minister to ask for an investigation by the Stock Exchange into an apparent insider deal where no such investigation or report appears to have been carried out by the Stock Exchange. The amendment would add two further subsections to the new section 98 which itself was added to the Bill on Committee Stage. When the Seanad on Committee Stage discussed my proposals for strengthening the provisions on insider dealing some Senators expressed concern that there was no action the Minister could take in a situation where the Stock Exchange failed or indeed refused to carry out an investigation. I made it very clear at that stage that our intention was that the Stock Exchange would be the primary vehicle for policing Part V and I expressed complete confidence in the Stock Exchange's ability and indeed their willingness to take on the job of enforcement which we are providing for here.

On the other hand I also made it very clear that I did not want the Minister automatically becoming a first avenue for complaints. Having said that, however, I think that there is merit in giving the Minister a kind of reserve role to cater for any situation that might arise in which the Minister wished to establish the circumstances involved. I would, however, emphasise that it is not a power I would see the Minister using or indeed having to use, except in the most exceptional circumstances.

Since I have never been able to make a fundamental distinction in kind between the Stock Exchange and a bookie's office other than in the powers of those who operate in one rather than the other——

You make more money in one.

That is not a distinction in kind, it is a distinction in degree. I was always sceptical, I would not leave bookies to run the bookmaking business any more than I would leave the Stock Exchange to look after that side of it. I am very glad that the Minister has taken the residual power. I think it completes the section and it leaves us with the feeling that there cannot be any organised protection of individuals. I accept, incidentally, that for very good commercial reasons most members of the Stock Exchange would not like to be involved in insider dealing because it upsets the normal commercial operation of the Stock Exchange, any more than people operating bookmakers' offices would like to have horses nobbled. It does not enable people to have an equal chance. Therefore, I welcome the amendment and compliment the Minister for it. It strengthens the Bill further.

On the amendment I, too, support the inclusion of a residual power to the Minister to stimulate the necessary carrying out of the powers, if they have not been carried out in the first instance by the relevant authority but I am just concerned that there is no time scale built into the exercise by the Minister of his power. In section 98 as it stood under subsection (1) there was a duty or a responsibility on the relevant authority, at least if it was of the view that a person had committed an offence to forthwith report the matter to the director and to furnish the director with such information. If the Minister is of the view that this is not being done he can request that the powers be exercised, but is it proposed that this would be done within a time scale or could the matter be the subject of a good deal of rumour and speculation over several months which would not be desirable in the public interest?

Under section 98, the duty of the Stock Exchange is that if it appears to the relevant authority, they shall forthwith, etc.

It is the acting forthwith that is the point.

I am not clear whether we need to do it in that way. If you are giving the Minister a reserve power in the event of the Stock Exchange not acting, I wonder if it is wise to tie the Minister's hands if something which perhaps should have come to light did not come to light within a specified time. I think it is probably unnecessary. I will not rule out giving it some thought in the other House if you wish. If the Stock Exchange act immediately forthwith, that is fine but we should not really tie the Minister's hands too much in the sense of a time limit. However, I have no hard and fast views on that. If Senators feel it is very important I will certainly have a look at it.

Amendment agreed to.

Acting Chairman

At this stage may I formally clear the additional amendment mentioned by the Minister earlier? That additional amendment is No. 23a.

Government amendment No. 23 (a):

In page 84, line 21, after "sections", to insert "95,".

Amendment agreed to.
Amendments Nos. 24 and 25 not moved.

I move amendment No. 26:

In page 95, line 6, after "claims" to insert "(the amount of which is actually stated)".

This is simply a technical amendment which proposes that rather than leaving the wording as vague as it is in the present section that the exact amount should be stated.

Acting Chairman

Is the amendment seconded?

I was not aware that this was a problem under the current text of the Bill. The section as it stands does two simple things. First, it allows the liquidator to advertise publicly for preferential claims and says that preferential status would apply only to those debts which have been notified to the liquidator within six months of his advertisement. This clearly means that the amount of the debt must be notified to the liquidator. I believe no other meaning is possible and my legal advisers have confirmed this to me.

With regard to the Senator's amendment, I am also advised that this would merely serve to confuse rather than to clarify any matter. It is one thing to refer to "debts, whose amounts must be stated" and another thing to refer, as the amendment does, to "newspaper advertisements for claims whose amounts are actually stated". On the substantive issue, I am happy that the meaning of section 112 is clear from the current text and that the amendment is not required.

An Leas-Chathaoirleach

Is the amendment withdrawn?

Amendment, by leave, withdrawn.

An Leas-Chathaoirleach

Amendments Nos. 27 and 28 are related and, therefore, may be discussed together.

I move amendment No. 27:

In page 95, between lines 10 and 11, to insert the following:

"113.—Section 285 of the Principal Act is hereby amended by the deletion of subsection (2) (a) (ii).".

The House will recall that on Committee Stage we had a substantial debate on the rights and wrongs of preferential status being held by the Revenue Commissioners under section 285 of the Principal Act. Because of the substantive enforcement powers the Revenue Commissioners have acquired in recent years I believe it is unnecessary for them to hold the preferential status they enjoy at present under the Act. The power of attachment, the power of seizure given to sheriffs and various other enforcement powers have given the Revenue Commissioners every opportunity to ensure that outstanding arrears of tax are cleared. The Revenue Commissioners have no excuse to delay the collection of outstanding taxes on the basis that if a company goes into liquidation they will retain "first call", as it were, on the assets or any moneys which would arise out of the liquidation. That preferential status is unnecessary at this time and the recent amnesty for taxpayers who had moneys outstanding has shown that these moneys could have been collected if the proper enforcement procedures had been in operation some time ago. Over the years successive Governments have put in place a number of measures which mean that the Revenue Commissioners have no excuse for not getting on with their job of collecting outstanding taxes and keeping Schedule D and self-employed taxpayers up-to-date in the payment of their taxes.

Because the Revenue Commissioners have preferential status under the Act, unsecured creditors do not believe that sufficient money will be left in a company in order to keep a number of small businesses in operation once the principal company in the liquidation has been wound-up. I think the Minister may be aware of many instances where the amount of money left to pay unsecured creditors and suppliers of goods after the principal creditors such as the Revenue Commissioners and financial institutions are satisfied is minimal and not significant in terms of keeping those smaller companies in operation. This is why I believe it is time to remove the preferential status of the Revenue Commissioners and to ensure that the unsecured creditors, who are not protected under the law, have an opportunity of getting greater recognition and recompense at the end of the day when a company fails through no fault of the unsecured creditors or the supplier of goods.

An Leas-Chathaoirleach

Is the amendment seconded?

I second the amendment.

Perhaps the Minister will clarify a point for me. Unfortunately I do not have the Principal Act in my head as the Minister probably does — and if he does not there are three people sitting behind me who do or at least have to pretend they do. If what we are talking about are simply the taxes due from the profits of a company then one would have considerable sympathy with Senator Hogan's amendment but if, on the other hand, we are talking about the deductions made by a company from, say, its employees or the excise duty or VAT collected by a company in the course of its commercial operations then we are talking about something entirely different. In one context we are simply talking about the taxes due to be paid by a company out of its profits — and one has considerable sympathy for companies who are in difficulties and perhaps paying taxes a year in arrears — but, on the other hand, deductions from employees have no business ever being put into the funds of a company and VAT collected by a company, by virtue of its legal obligation to do so, also has no business being put into the funds of a company.

I think this distinction is often lost in the media in terms of the taxman allegedly closing down various well-known enterprises, among them one famous restaurant, simply because the company had never made any VAT returns. VAT is a tax collecting job done by companies on behalf of the State. PRSI is collected by companies under a legal obligation and part of it at least is the property of the company's employees and obviously it is both illegal and immoral to use that money for any other purpose. In terms of protecting the interests of the State and employees, it is clearly right that the Revenue Commissioners should have preferential status in those areas. If we were simply talking about the taxes of a company then one would have a lot more sympathy with Senator Hogan's amendment.

I think it is appropriate for me to make my intervention on this amendment before the Minister responds because I, too, have considerable sympathy with the main thrust behind the amendment to remove the privileged status of the Revenue Commissioners. I should like to ask the Minister if there has been any assessment of whether the fact that the Revenue Commissioners have a privileged status as creditors has been responsible for a lack of vigilance in ensuring that tax is collected from certain companies, in other words, does the tendency to let companies play along stem from the fact that at the end of the day the Revenue Commissioners are a privileged creditor? I want to add to the other points that have been made the possibility that this could engender an attitude of not being adequately concerned to ensure that companies are paying their tax when it is due.

These two amendments relate to the question of preferential payments in a winding-up and propose that the existing preference in relation to assessed taxes and PAYE should be removed. Senators will remember that when this matter was being discussed on Committee Stage I gave an undertaking to examine this subject as a matter of some urgency. This examination is taking place at present and I had hoped that it would be completed before we reached Report Stage of the Bill. However, I think Senators will agree that this is an extremely complex and important issue and requires extensive consultation with a wide variety of interests. I can assur the House that this question is receiving priority attention in my Department. However, I am not in a position at this stage to indicate to the House what the outcome of that examination will be and I regret, therefore, that I am unable to agree to these amendments at this stage.

I do not know whether there is evidence of the type referred to by the Senator. Consultants and accountants will have different experiences in this area. There are two sides to the story: on the one hand the Revenue Commissioners should go and get their money — that is their job — and, on the other hand, it is public money, particularly the PAYE aspect of it. There can be and there is certainly a distinction between the assessed taxes and those that are belonging to the workforce, and in the examination which is going on that distinction has been taken fully into account.

Senator Ryan asked me about the Principal Act. There are two sections in it. One is assessed taxes which deals with subsection (2) (a) (ii) referred to in the amendment. That is assessed taxes — company profits and so on, obviously. The other is subsection (2) (a) (iii) which deals with amounts due under PAYE, PRSI and so on. That is what the two sections apply to, and it is proposed in Senator Hogan's amendment to remove the preferential treatment from both of those. I regret that my examination is not concluded at this stage, but I want to assure the Seanad that it is an examination which I am taking extremely seriously.

An Leas-Chathaoirleach

Senator Hogan to conclude.

I am very disappointed that the Minister has not seen fit to have his review finished by Report Stage of this Bill. It is a very clear cut issue in view of the enormous powers the Revenue Commissioners have built up over a number of years, particularly with the introduction of power of attachment from 1 October. There are powers now that the Revenue Commissioners have which would deal adequately with the collection of taxes without having the build up of arrears we have seen as a national scandal over the past couple of years.

I share Senator Robinson's concern that there is a concept abroad that companies are so allowed because they would go into company failure if the Revenue Commissioners imposed their will too early. At the end of the day, in so far as they have preferential status the Revenue Commissioners can get their money at any time. Certainly there is no indication of urgency on the part of the Revenue Commissioners in some cases to ensure that businesses keep their tax affairs up to date. We are all aware that it is not in a firm's interest to have an accumulation of tax arrears because it gives a false illusion of profitability on the part of the firm. For that reason it is always in the interest of the firm to make sure their payments are up to date in relation to tax. The employees have very little to worry about because they are also preferential and protected under the insolvency legislation of 1984. The provision in relation to the taxation that arises out of company profits is not necessary at this stage in view of the powers at the Revenue Commissioners' disposal. Also it takes up resources that are much more essential in order to keep other firms in operation, such as the people who have supplied goods in an unsecured way to the company.

If we want to maintain the smaller business people in business we need to ensure that the unsecured creditors are given some chance to get the maximum possible dividend out of the liquidation procedure rather than just relying on the willy-nilly movement of the Revenue Commissioners and the financial instituitions who will gobble up all there is to the detriment of the unsecured people. My sympathy in this legislation lies with the unsecured creditors who have done everything right by supplying the goods but who would not know whether that company was in a position of viability. Unfair treatment of those people is certainly morally wrong and not justified. Under the present powers of the Revenue Commissioners there is no reason whatsoever why they cannot collect the taxes that are rightfully owed to the Exchequer by the various firms without resorting to the preferential status they enjoy at present.

An Leas-Chathaoirleach

Is the amendment withdrawn?

Amendment put.
The Seanad divided: Tá, 14; Níl, 22.

  • Bradford, Paul.
  • Connor, John.
  • Doyle, Joe.
  • Fennell, Nuala.
  • Ferris, Michael.
  • Harte, John.
  • Hogan, Philip.
  • Kennedy, Patrick.
  • Loughrey, Joachim.
  • McCormack, Padraic.
  • Norris, David.
  • O'Shea, Brian.
  • Robinson, Mary T. W.
  • Ryan, Brendan.

Níl

  • Byrne, Seán.
  • Cassidy, Donie.
  • Cullimore, Seamus.
  • Doherty, Michael.
  • Eogan, George.
  • Fallon, Seán.
  • Farrell, Willie.
  • Fitzgerald, Tóm.
  • Fitzsimons, Jack.
  • Haughey, Seán F.
  • Hillery, Brian.
  • Hussey, Thomas.
  • Lanigan, Mick.
  • Lydon, Donal.
  • McGowan, Patrick.
  • Mullooly, Brian.
  • Mulroy, Jimmy.
  • O'Callaghan, Vivian.
  • O'Connell, John.
  • O'Toole, Martin J.
  • Ryan, William.
  • Wallace, Mary.
Tellers: Tá, Senators Doyle and McCormack; Níl, Senators W. Ryan and S. Haughey.
Amendment declared lost.

I move amendment No. 28:

In page 95, between lines 10 and 11, to insert the following:

"114.—Section 285 of the Principal Act is hereby amended by the deletion of subsection (2) (a) (iii)."

An Leas-Chathaoirleach

Amendment No. 28 has already been discussed with amendment No. 27. Is the amendment being pressed?

Amendment, by leave, withdrawn.

I move amendment No. 29:

In page 95, between lines 10 and 11, to insert the following:

"116.—Section 285 (2) of the Companies Act, 1963 is hereby amended by the addition of the following:

‘The unpaid purchase price or any outstanding balance thereof for any goods supplied to the company under a contract for sale and actually delivered to the company, it's servants or agents during the three months next before the relevant date'.".

This amendment seeks to insert under the Principal Act of 1963 a recognition of unsecured creditors in the list of people mentioned as beneficiaries after the liquidation of a company. It is well recognised that the position of a person who supplies goods and is not paid for those goods in the event of a company liquidation is a very serious and important issue. Many smaller companies go into liquidation as a result of the liquidation of a larger company. I am extremely concerned that in the absence of a retention of titled clause under the Act, the unsecured creditors, the people who will be unpaid for those outstanding balances to the company, are running the risk of going into serious financial difficulties. It follows that, if we regard the preferential status of the Revenue Commissioners as unnecessary in view of the wide-ranging powers they have at their disposal, it is only fair that we should include, if we are not prepared by voting here today to remove the preferential status of the Revenue Commissioners, the unsecured creditors on the list, under Principal Act, of people who are entitled by law to compensation for the goods they supplied and for which they were not paid.

The law should protect the creditor who seeks to protect himself or herself. By the insertion of this clause the Minister will be recognising the position of the smaller more vulnerable companies who have supplied goods in good faith to a company but, because the company goes into liquidation, now find themselves in a financial predicament. We have had many examples of this recently. The H. Williams collapse and the Clover Meats collapse are examples of where goods were supplied and a long and protracted argument ensued about the level of compensation those suppliers got at the end of the investigation and liquidation procedures. The Minister is aware that a number of smaller companies who supplied goods to H. Williams are no longer with us because of the appalling demise of that company without any warning to the suppliers of goods of the financial position of the company.

Another example is Clover Meats where farmers supplied cattle to the factory and, at the end of the day, had to be satisfied with 50p in the pound as compensation for the supply of goods. The cattle went to the factory and the farmers were not paid for them. In law they should be recognised as people who supplied their goods to the factory. This is the appropriate time to do that. I look forward to a more sympathetic hearing on this matter than I have received from the Minister in relation to the preferential status of the Revenue Commissioners.

It is obvious, as Senator Hogan has said, that there is a knock-on effect when a major company, or even a smaller company, goes into liquidation. This can have a serious knock-on effect on the smaller companies that have, over the years, supplied goods to that company, in many cases on a three month or a one month credit basis. They are not getting paid for goods supplied. Those companies are entitled to protection in law and if we do not insist on having this included now by the passing of this amendment those companies will not have the protection they deserve and desire.

Senator Hogan made a very convincing case for the intervention of the State to avoid the unfortunate consequences of the operation of a free market but, since the Senator is committed to the idea of the free market as the best way to operate our society, there is a certain lack of logic in it.

I thought the idea of free markets and competition was to encourage efficiency and risk assessment, all those qualities that have now joined the pantheon of the qualities that are required for qualification as a latter day Irish saint, or at least a doctor. To suggest that this would only apply to small companies is quite ludicrous. It would very often apply in the opposite direction. It would secure even further the position of large companies vis-á-vis smaller companies where goods have been sold on credit and would eliminate a large area of the sort of risk-taking that is supposed to be the lifeblood of business.

It would also raise interesting questions as to whether any company with that sort of a copperfastened position at home could be persuaded to get involved in high-risk export markets where similar guarantees, even with the export credit guarantee scheme that is available, would either not be available or would have to be paid for by way of some form of insurance which is the way the export credit guarantee scheme is paid for. It would produce, if I can wear my market economics that, considerable market distortions. As well as that it would give disproportionate advantages and pro-tections under the law to one sector of society that are not available to many other people where a company goes into liquidation. I do not think there is any logic to it. I could not possibly support it.

The illogicality of what we have heard from Senator Ryan has me puzzled. It appears to me that the man in some sense preaches socialism and yet in this instance would like those at the bottom of the pile to be the ones that will suffer most. The only hat I can wear in this instance is very much a lay one because it is the only hat I happen to have with regard to company law. It would appear to me from observation in my own area that the man who suffers most in an instance of liquidation is the man at the bottom of the pile — the small supplier or the small subcontractor. The Revenue Commissioners get a charge; the secured loans from banks get a charge; the liquidator gets charges and there is virtually nothing left for the small creditor who, in turn, has given credit to some other suppliers.

For example, the small plumber, electrician, bricklayer, people who purchase goods and then provide a service by going and laying goods on a factory or a building site are the last people on the line, and they are the people who get hurt. While the main contractor may rise like a Phoenix from the ashes, the small contractor seldom does. This is a situation I have seen often. The small man never, ever gets back on his feet, but the other man does. The Minister is now trying to heal the anomalies that were in the law. Heretofore the bigger man was able to get back on his feet but the smaller man never surfaced again. A lot of them are dead and buried. This has resulted in the type of unemployment that we have. I support the amendment.

What this amendment is proposing is that certain ordinary creditors should be regarded as preferential creditors in a winding-up situation. As I indicated to the House when this amendment was discussed on Committee Stage, the subject matter of this amendment is very much related to the previous two amendments on preferential creditors. This matter is receiving serious attention in my Department and a decision will be made as soon as possible as to whether changes should be made in the present system of preferential creditors. I had hoped this examination would have been completed in time for Report Stage of the Bill. However, the matter is an extremely complex one and it has not been possible to carry out the necessary consultation in the time available. I must, therefore, oppose the amendment at this stage.

In regard to what Senator Loughrey said about the people at the bottom of the pile, the difficulty is that if we move everybody off the bottom of the pile and everybody becomes preferential, there are still people at the bottom of the pile, but now some of the preferential people are at the bottom of the pile.

Those at the bottom of the pile became preferential.

We are dealing with an insolvent company. If you move people up in the preferential list you move other people down. You cannot move everybody up and then draw a line. Otherwise you are in difficulties. However, you are back to the argument about whether the Revenue Commissioners should have preferential treatment because by moving one category up you are, in effect, moving the revenue category down and that brings us back to the earlier debate.

There is an important point to be made about the employees who are owed money. That very often happens when companies go down these days. Employees can be left owed a lot of money. If you move the people who were due goods up the line of preferential creditors, employees who are not moved up because they did not supply goods but supplied a service get less. The people at the bottom of the pile would be employees, not just suppliers of goods many of which may be multinational companies and not necessarily all small companies.

I am pleased that the Minister is studying the area of preferential status because there is a strong feeling abroad that something should be done for the small creditor. On the other hand, the small creditor can help himself. A nice phrase was used by one Senator, "risk assessment". It is an area where a lot of small companies fall down; they do not put enough time and effort into checking out the companies they are supplying.

It is strange that there are a number of companies who would not dream of giving credit when exporting; they insist on letters of credit or they take out export credit guarantees and export insurance. Yet, the same companies for some reason are prepared to give credit locally to companies who in many cases they know are in danger. The question is whether any creditor should be given preferential treatment. As I have said, I am pleased that the Minister is making a careful study of this matter. Finally, any company can draw up a legal document retaining title to its goods. Maybe this is an area at which companies should look more closely.

We are living in an era where extended credit is the norm in relation to business activities, with larger companies exploiting smaller companies to an inordinate degree in order to maximise the amount of credit they can get from them. It is not unusual for large firms to get 90 days credit from smaller suppliers who are vulnerable in the event of liquidation. That is what happened in some of the examples I gave earlier.

We are not seeking to have preferential status given to everybody and we are giving examples of those from whom we want it removed. It is in that context that we are discussing the matter. We want to remove it from the Revenue Commissioners because they already have adquate powers to do their job. We want clear recognition in law that people who supply goods and who are in a vulnerable position will be treated as preferential creditors, no more nor no less than that.

It is not satisfactory from my point of view for the Minister to tell me here today that he has not had time enough to assess the position. He has had adequate time and he has not satisfied me that he has any intention of putting unsecured creditors into section 285 of the Principal Act.

An Leas-Chathaoirleach

Is the amendment withdrawn?

Amendment put.
The Seanad divided: Tá, 10; Níl, 25.

  • Bradford, Paul.
  • Connor, John.
  • Doyle, Joe.
  • Ferris, Michael.
  • Harte, John.
  • Hogan, Philip.
  • Kennedy, Patrick.
  • Loughrey, Joachim.
  • McCormack, Pádraic.
  • O'Shea, Brian.

Níl

  • Byrne, Seán.
  • Cassidy, Donie.
  • Cullimore, Séamus.
  • de Buitléar, Éamon.
  • Doherty, Michael.
  • Eogan, George.
  • Fallon, Seán.
  • Farrell, Willie.
  • Fitzgerald, Tom.
  • Fitzsimons, Jack.
  • Hanafin, Des.
  • Haughey, Seán F.
  • Hillery, Brian.
  • Hussey, Thomas.
  • Lanigan, Mick.
  • Lydon, Donal.
  • McGowan, Patrick.
  • Mullooly, Brian.
  • Mulroy, Jimmy.
  • O'Callaghan, Vivian.
  • O'Connell, John.
  • O'Toole, Martin J.
  • Ryan, Brendan.
  • Ryan, William.
  • Wallace, Mary.
Tellers: Tá, Senators Doyle and McCormack; Níl, Senators W. Ryan and S. Haughey.
Amendment declared lost.
Amendment No. 30 not moved.
Government amendment No. 31:
In page 107, to delete lines 28 to 30 and substitute the following:
"(13) Any liquidator who contravenes subsection (7) or (8) shall be guilty of an offence and shall be liable—
(i) on summary conviction, to a fine not exceeding £1,000 and, for continued contravention, to a daily default fine not exceeding £50, or
(ii) on conviction on indictment, to a fine not exceeding £10,000 and, for continued contravention, to a daily default fine not exceeding £250.".

On Committee Stage Senator Mulroy questioned why the penalties currently provided for in section 128 (13), in other words, summary fines only, should not be harmonised with the penalties prescribed for similar offences elsewhere, for example, in section 123. That would involve prescribing a monetary penalty on conviction on indictment. On reflection I accept that it seems reasonable, given the importance of section 128, that the application of criminal sanctions involving larger amounts should be provided for in the section. As in the case of section 123, however, I do not think the possibility of a prison sentence is warranted here.

I understand from the Minister that he has responded to a point made during Committee Stage but I am concerned that we would add a possibility of a conviction on indictment either in relation to subsection (7) or subsection (8). Subsection (7) requires the liquidator to notify persons who are directors of an insolvent company. The question of notifying them is not what would govern their own possible offences under the subsection. If they are directors covered by the subsection then they are covered whether they are notified by the liquidator or not, as I understand it. This amounts to a notifying role of the liquidator and, quite honestly, I feel that to put a burden of possible prosecution on indictment, which later in the Bill would leave a liquidator open to disqualification proceedings being brought or a court of its own motion deciding to disqualify, seems very heavy. I am not a natural defender of liquidators but it does not seem to me to be an appropriate remedy or redress under subsection (7). It is clear in subsection (7) what the liquidator should do and we have to decide whether a summary penalty is enough, as I believe it is, or whether we should add, as the Minister is proposing in the amendment, that he would also be liable on indictment to a fine.

However subsection (8) is not clear. It imposes a very difficult duty on the liquidator. I should like to tease out what my concern is because as the Bill is discussed in the other House it may be possible to get a more precise formulation. Subsection (8) states:

Where it appears to the liquidator of a company to which this section applies that the interests of any other company or its creditors may be placed in jeopardy by the relevant matters...

Therefore, it would have to be established that it did appear to the liquidator. Presumably, the liquidator would say that it did not appear to the liquidator. It is not clear what exactly must appear to the liquidator. Even if a director was a director of a company that has become insolvent that director is not totally disqualified.

Under subsection (5) that director can be a director of another company and the liquidator would have to be aware of whether the provisions of subsection (5) were satisfied, or would he? How would he form the view in good faith? How would he know whether he should alert the court or not? In those circumstances is it really appropriate to have the liquidator possibly open to a trial on indictment and to a conviction on indictment with the disqualification provisions that would apply? I am concerned that for the sake of harmonising the penalties we are in fact loading the liquidator with such penalties. We may have difficulty in finding good liquidators, something that would not be in the public interest or desirable. I am not of the view that it is appropriate to harmonise the penalties and create offences on indictment for infringements of subsections (7) and (8).

I take the Senator's point that this may appear heavy on the liquidators and I will have to think about it as it goes through the Dáil. I should like to tell the Senator that in subsection (8) we are requiring the liquidator to come to an opinion and I will see if it achieves that as the Bill winds its way through the Dáil. I take the point on board that this is a requirement to notify and that the penalties might appear heavy. I will look at that as it goes through the Dáil. What we are trying to do for now is require him or her to come to a decision on the matter. We will certainly look at the subsection.

Amendment agreed to.

An Leas-Chathaoirleach

Amendments Nos. 32 and 33 can be discussed together.

Government amendment No. 32:
In page 111, line 32, after "officer,", to insert "employee,".

These two amendments arise from an amendment proposed on Committee Stage. The Senator at the time sought the inclusion of a trade union among the parties that could make an application under subsection (4) for a disqualification order. In response, I indicated that while I would be opposed to giving such a right to a trade union, I would not have a similar difficulty in permitting employees to take such action. Indeed, wage earners, redundant employees or whatever would be regarded as creditors of a company anyway and be capable of making such an application. That is the purpose of this amendment.

These amendments were proposed on Committee Stage by Senator O'Toole and I very much welcome the fact that the Minister has given them careful consideration and has come up with these amendments to include expressly the capacity of an employee to be an applicant under the section.

Amendment agreed to.
Government amendment No. 33:
In page 111, line 41, after "contributory", to insert ",employee".
Amendment agreed to.
Government amendment No. 34:
In page 114, to delete lines 7 to 41 and substitute the following:
—(1) Where any consideration is given by or on behalf of a company for an act done or service performed by a person who is convicted of an offence under section 136 in relation to the company while he was acting in relation to the company in a capacity or manner from which he was prohibited by virtue of the application of the provisions of this Part to the company, the company shall be entitled to recover from him, as a simple contract debt in any court of competent jurisdiction, the consideration or an amount representing its value.
(2) Where a person is convicted of an offence under section 136 in relation to a company and the company concerned is in the course of being wound up on the date of the conviction or commences to be wound up within 12 months after that date, the court may, on the application of the liquidator or any creditor of the company, declare that such person shall be personally liable, without any limitation of liability, for all or any part of the debts or other liabilities of the company incurred in the period during which he was acting in a capacity or manner from which he was prohibited under this Part.
(3) Where a company which has recieved a notification under section 130 (6) and which carries on business following such notification without the requirements of section 128 (5) being fulfilled within a reasonable period—
(a) is subsequently wound up, and
(b) is at the time of the commencement of the winding-up unable to pay its debts (taking into account the contingent and prospective liabilities),
the court may, on the application of the liquidator or any creditor or contributory of the company, declare that any person who was an officer of the company while the company so carried on business and who knew or ought to have known that the company had been so notified shall be personally responsible, without any limitation of liability, for all or any part of the debts or other liabilities of the company as the court may direct.
(4) In any proceedings brought against a person by virtue of this section the court may if, having regard to the circumstances of the case, it considers it just and equitable to do so, grant relief in whole or in part from the liability he would otherwise be subject thereunder and the court may attach to its order such conditions as it sees fit."

On Committee Stage, Senator O'Toole identified what we agreed was a problem with the practicality of section 139 (2). While the Senator agreed with the sentiment behind the subsection he pointed out that the company concerned might actually be trading profitably, correctly and legally and that any debts incurred by the company should be completely above board. The only thing wrong with it would be that the director concerned should not be acting. The Senator did not understand how the director concerned could be held personally liable for the company's debts in such a situation and how the debts could be measured and so on. On account of this problem we have redrafted subsection (2) to make it apply only in a case where the company concerned is being or is subsequently wound up. This will mean that the debts concerned will be readily identifiable, and it is the more normal type of personal liability provision.

A further problem arises with this section which I overlooked on Committee Stage when we introduced a new subsection (4) providing for a particular type of personal liability. I overlooked the need to apply subsection (3) to the new subsection, in other words the possibility of seeking relief. While I am rectifying this in the present amendment I am also taking the opportunity to reverse the order of subsections (3) and (4).

This is a welcome amendment. I was present when Senator O'Toole raised the query. It is appropriate that the Minister would bring in an amendment which would distinguish the position of a company from the position of an individual.

Amendment agreed to.
Government amendment No. 35:
In page 117, to delete lines 12 and 13, and substitute the following:
"(4) Nothing in this section shall require a receiver appointed before the commencement of section 145 of the Companies Act, 1988, to vacate the office to which he was so appointed.".

On Committee Stage we inserted a new subsection, (4), in section 145, the purpose of which was to enable receivers who were in place when the prohibitions in the section came into effect, to complete their existing assignments, even though they would no longer be able to meet the new requirements. Our wording raised difficulties for some Senators who suggested that the wording of the amendment went further than we intended it to. The feeling was that the wording used could be interpreted to mean that any such receiver who was acting when the section commenced would not be caught by the prohibitions of section 1 in respect of any future receivership assignments and not just the appointment that he held when the section came into effect. On further examination we agreed that the wording was somewhat ambiguous. Obviously, all we want to do here is to allow receivers who stand appointed in a particular company but who would find themselves required to resign by virtue of subsection (2), to complete that assignment. Amendment No. 35 will remove any doubt that the original wording may have created.

Amendment agreed to.
Government amendment No. 36:
In page 117, between lines 33 and 34, to insert the following:
"(iv) employees of the company comprising at least half in number of the persons employed in a full-time capacity by the company;".

This is similar to other amendments brought forward here today. Section 146 inserts an amended section 316 into the principal Act. Essentially, the revised section 316 adds to the number of parties who can seek a court direction in regard to the performance by receivers of their functions. Senator O'Toole tabled a Committee Stage amendment which sought the inclusion of both trade unions and employees as parties who could seek directions under this section. In responding to that proposed amendment I indicated that if employees are owed money by the company they would already be covered by subsection 1 (a) (iv) in that they would already be a creditor of the company. Having reflected further, however, I am now prepared to put the matter beyond doubt by specifically including employees in their own right, thereby making it clear that they can seek a court direction without any strings attached. However, in order to prevent vexatious, devious or frivolous applications by employees, my amendment would require at least half of the full time workforce of the company to join in the application to the court. This is a reasonable condition in these circumstances.

I welcome this amendment which is clearly a positive response by the Minister to the points made by Senator O'Toole on Committee Stage. Is it proposed to insert a new subsection (4) and then have the existing subsection (4) as (5), or is this a substitution?

That is what I propose to do.

So subsection (4) becomes subsection (5)?

Because it is an application to court, I am a bit concerned that half the employees of a company are not a legal entity. Has any thought been given as to how an application can be made by half the employees? Presumably an application signed by half the employees would be sufficient. I presume there would not be a formal difficulty for them in making an adequate application.

At another part of the Bill we have a figure of £10,000 as an aggregate for creditors, but that is easily identifiable. I see the Senator's point in relation to this but I would not worry about it because in practice half the full-time workforce would sign an application. If that proved difficult I imagine the court would lay down some method by which they would receive such an application.

Amendment agreed to.

We now move to amendment No. 37. Amendments Nos. 38 and 39 are alternatives. Amendments Nos. 37, 38, 39 and 40 can be discussed together.

I move amendment No. 37:

In page 118, to delete lines 6 to 20.

I put this amendment down to highlight the fact that the best examiners under Part IX of the Bill are probably receivers. I made the point on Committee Stage that, in the event of a receivership in a subsequent liquidation, the words "best price" are open to interpretation. The section is not necessary, when one considers that a creditor can go to court under another section of the Bill. Perhaps we should be contemplating not including certain provisions under section 147. It should be done by exceptions and perhaps penalties on rogue directors in this case. The words "best price" are too open to interpretation. There could be difficulties in interpreting "best price" to the detriment of many people who might be owed money. I know that in this case we are dealing with receiverships and not liquidations but the best vehicle for bringing an ailing company back to a proper financial footing is a receiver. The duty of a receiver in selling property in order to get the best price reasonably available is open to too much interpretation.

I second the amendment.

These three related amendments propose, first, that section 147, which inserts a new section 316A into the 1963 Act, be deleted or, alternatively, that certain amendments be made to subsection (1) of section 316A. I would like to start with amendment No. 37 which would delete the entire section. As a rule, a receiver, however appointed, is concerned with protecting the interests of a company's creditors and in particular those who appointed him. In many cases he sells off company assets to pay off the creditors who appointed him. When this is done, and assuming that assets still remain, the receivership ends and the company reverts to the original owners.

It has always been the case — and I would stress this — that the receiver is obliged to secure the best possible price reasonably obtainable when selling the property of a company. However, up to now, this tended to be simply regarded as "best practice", based among other things on a series of court judgments over the years, rather than a statutory requirement. Section 147 of the Bill proposes to make the existing "best practice" a statutory requirement.

As originally drafted, the section would have obliged receivers to get the best price for every single item they sell, regardless of whether they sell company assets as a whole or piecemeal. As I explained on Committee Stage, on many occasions the best outcome for all concerned with the receivership is the sale of a company as a going concern, or the sale of all stock in one unit. If we had stayed with the original proposals, we considered that receivers would have shied away from disposing of company assets on a going concern basis and, to protect themselves, would have disposed of everything by auction. This would certainly avoid the situation where they could be accused of selling particular premises, stock or raw materials at an under value — but it would not necessarily be in the best interests of the company or its workforce. The amendment we introduced on Committee Stage tackled this particular aspect.

The other amendment made the duty of a receiver to obtain the best price a general one rather than one specifically owed to the company.

I am satisfied that there is a real need for this particular section and that it is not sufficient to leave the situation where receivers operate solely on the basis of best practice. In the circumstances I am satisfied that the section, as amended on Committee Stage, should be retained as part of the Bill.

Amendment No. 38 would insert "by public auction" after "property" in line 8. This would confine the requirements of this section to situations where a receiver sold property by public auction. Therefore, a situation where a receiver sold property otherwise than by public auction would continue, as before, not to be governed by a specific statutory provision. This is not something I would be happy to permit.

Moreover, if such a requirement is now imposed on receivers selling by public auction, it may very well mean that they would steer clear of selling by public auction altogether, and sell by private treaty or on some other personal basis. This may not be the most advantageous way to run the receivership.

Where assets are disposed of by public auction, this usually reduces the amount of money that will be realised, because the bidders at the auction would be aware that, since the assets have to be disposed of and they do not meet counter bidders, they can get their purchases at a knockdown price. Also in an auction situation it is important to remember that the premises for sale could be purpose-built and any new bidder would really only end up with the shell of the building as suitable for his purposes. Therefore, what he would be prepared to pay would be far less than the worth of the buildings to the company as a going concern.

There is a further point that, if this requirement was now placed on a receiver, how could one measure whether or not he had taken all reasonable care to obtain the best price reasonably obtainable? For instance, would he himself be expected to conduct auctions or would he have to be able to show that he had made every effort to get people to attend the auction and while at the auction to participate in the bidding?

Amendment No. 39 proposes the insertion of "in cash" after "best price". As with the first alternative amendment, I would see this as reducing the options available to the receiver in that if he can only accept payment in cash, other methods of financing purchases would no longer be permitted. For instance, Senators will be aware that new means of financing take-overs and buy outs are being introduced all the time and similar arrangements may be available in a receivership situation. However, if the proposed amendment were to be accepted, the only means of paying for the assets being acquired would be by cash and as I said, the other options would be no longer available.

In summary, therefore, I am satisfied that the measures in the section, as amended on Committee Stage, will facilitate the efficient functioning of receiverships, and should be retained.

The only reason I am inserting the words "by public auction" under amendment No. 38 is that there is, unfortunately, under private treaty or by tender, a veil of secrecy surrounding what is being got for a company and what can be got for a company. When there is a public auction it is under scrutiny by the public and all the players know exactly what is on the table and what is not. Under amendment No. 39 the situation can arise where people can make an offer for a particular asset without any money whatsoever, but they can absolutley turn off another offer made previously which might be under the offer now on the table but which is now disallowed because the receiver did not accept it earlier. Cash on the table is a more concrete mechanism by which the real value of the offer and the bid is shown in very physical terms in a situation which is extremely important in order to effect the smooth takeover or reconstruction of a company or perhaps a joint venture or an injection of equity into that particular company at an important time.

It is important for the receiver to know that the offer being made is legitimate and that a situation cannot arise afterwards where the money for the bid that was made cannot be raised or the offer that was made is now not an offer because of the inability of the people making the offer to come up with the finance at the right time. To protect the receiver in that position I am proposing that the words "in cash" be inserted. The words "public auction" are necessary and would remove the secrecy and private treaty element. It is not always the people with the highest price who can get a property under that system.

Amendment, by leave, withdrawn.
Amendments Nos. 38 and 39 not moved.
Government amendment No. 40:
In page 118, line 14, to delete "that subsection", and substitute "subsection (1)".

Amendment No. 40 is consequential on the amendment which we made on Committee Stage. In that amendment we replaced the introductory paragraph to this subsection with a much briefer phrase.

Amendment agreed to.

Acting Chairman

Amendments Nos. 41 and 42 are out of order.

Amendments Nos. 41 and 42 not moved.
Government amendment No. 43:
In page 120, line 32, after "creditor", where it secondly occurs, to insert "(including an employee)".

On Committee Stage I introduced an amendment which provided, among other things, that contingent or prospective creditors could apply to the court to have an examiner appointed. The main, but by no means the only, category I had in mind here was employees of the company who might not in all cases actually be creditors. During the debate I indicated that I would come forward with an amendment on Report Stage to make it clear that the phrase "contingent or prospective creditor" included employees of the company, thereby enabling employees to make such an application in all situations and, in particular, where they were not owed money. This is the purpose of amendment No. 43.

I want to compliment the Minister. I am afraid that if I do not stand up and say "thank you" he might think we did not notice his efforts. I am very grateful to the Minister. Because a number of us, including the Minister, received considerable representations from the trade union movement about these things, I know the amendments will be welcomed by the trade union movement as well.

Amendment agreed to.
Government amendment No. 44:
In page 126, to delete line 46, and substitute the following:
"(2) A vacancy in the office of examiner shall, as soon as may be, be filled by the court.".

On Committee Stage Senator Ross was worried that, if an examiner were to resign in mid-stream, any delay by the court in filling the ensuing vacancy could cause chaos in view of the very tight timescale within which the company can be under the protection of the court. As I indicated at the time, I am quite confident about the court's ability to respond quickly to a vacancy situation arising in the circumstances outlined by Senator Ross. I am also concerned that the Bill should not, indeed could not, impose particular time constraints on the courts in this area. At the same time, I do accept that any delays in filling a vacancy could undermine the whole aim and structure of the scheme we are proposing here. Therefore, while the legal advisers have confirmed my reading of the situation, the amendment I am now bringing forward could give a clear guideline to the court that it should move quickly if such a situation arises. The legal advice is that this is as far as we can go here.

The Minister has been very generous to the court in not specifying a time limit in which they would fill the vacancy. It goes against the grain throughout the entire portion of the Bill to date because he has been imposing time limits all over the place and has been very reluctant to remove them. I made a suggestion in the form of an amendment earlier in the Bill, but it was not received too kindly because of the time limit the Minister wanted to retain. He should not be treating the court preferentially in this case. I cannot understand why the Minister is not imposing a time limit on the court because the courts can drag their heels in the matter and they can postpone the appointment of the examiner for a considerable length of time if there is more urgent business, the court may decide, to be attended to much sooner than the filling of a vacancy for an examiner.

Just to clarify the position, it is because it is the court that we are not laying down a time limit. It is not normal in this type of legislation to dictate its time schedule to the court. That is the only reason.

Amendment agreed to.
Government amendment No. 45:
In page 127, to delete lines 45 to 48, and substitute the following:
"(4) The examiner shall also supply a copy of his report under this section to any interested party on written application, provided that such supply may, if the court so directs, be subject to the omission of such parts of the report as the court thinks fit.
(5) The court may, in particular, give a direction under subsection (4) if it considers that the inclusion of certain information in the report to be supplied under that subsection would be likely to prejudice the survival of the company, or the whole or any part of its undertaking.".

Senator Ryan indicated in the course of Committee Stage debate that the proposed amendment we had brought forward on this subsection left the court without any guidance as to the matters it should omit from a report. I saw the Senator's point and undertook to have another look at that provision. I propose here, therefore, to delete subsection (4) as amended on Committee Stage and replace it by two subsections. The aim is to align the provision concerned with a similar provision in section 170 which deals with the examiner's final report. The idea is to give guidance to the court as to the particular circumstances in which an abridged version of the examiner's initial report to the court omitting certain sensitive information might be given to interested parties. The actual wording in the amendment is based on the corresponding provision in section 170. I hope that meets Senator Ryan's point.

It does, of course. The only question I would ask the Minister is something that Senator Robinson referred to earlier. Would an individual who had an interest in the company be able to make a case to the court, or how will the court arrive at a judgment about this? Would it be on the basis of people being represented before the court? Would the court have to take an active role in seeking comments from people, or would the court have to wait and would people have to be aware this was coming up and make representations? Presumably the report would not become public until after the court had taken a decision. How would people who wanted to make a case be aware of the unabridged contents of the report?

What we are doing here is putting in guidelines for the court as to when it should abridge the examiner's report. Obviously the court would be aware of the legislation and of the guidelines. Any party to the activities would be able to draw it to the court's attention.

Amendment agreed to.
Government amendment No. 46:
In page 130, line 14, after "meetings,", to insert "(but subject to notice of not less than three days in any case)".

We amended subsection (2) of section 170 on Committee Stage, inserting the words "notwithstanding any provision of the Companies Act relating to notice of general meetings" at the beginning of the subsection. The idea was that, given the three month limit for protection of the court the examiner ought not to be hamstrung by 21 days' notice periods under the 1963 Act whenever he wished to call a general meeting of shareholders. Some Senators objected to this, claiming that this would allow the examiner effectively to give no notice whatever when calling such meetings. I agreed at the time that there were grounds for the concerns expressed by Senators and I undertook to come back on Report Stage with an amendment inserting a minimum notice period of three days for calling the various necessary meetings of creditors and so on and this amendment provides that accordingly.

Amendment agreed to.

Acting Chairman

Amendment No. 47 and amendment No. 48 is consequential on it.

Government amendment No. 47:
In page 130, to delete lines 25 to 39, and substitute the following:
(4) The examiner shall deliver a copy of his report under this section—
(a) to the company on the same day as his delivery of such report to the court, and
(b) to any interested party on written application,
provided that such delivery under paragraph (b) may, if the court so directs, be subject to the omission of such parts of the report as the court thinks fit.
(5) The court may, in particular, give a direction under subsection (4) (b) if it considers that the inclusion of certain information in the report to be delivered under that paragraph would be likely to prejudice the survival of the company, or the whole or any part of its undertaking.".

Senator Ryan made the point on Committee Stage that although we were at that stage amending subsections (4) and (5) of this section in relation to the people who could get copies of the examiner's report under this section, there would be an inconsistency between the section as amended and section 167 as regards the reference to the registrar of companies. In other words, he was pointing out that while we had, by virtue of an earlier Committee Stage amendment, removed the registrar of companies as a person who would receive the examiner's first report on the basis that this represented unnecessary public disclosure, we should, to be consistent, do the same thing here in section 170 on the occasion of the examiner's final report to the court. We agree. Amendment No. 47 would make the necessary change to subsection (4), as well as making some necessary consequential amendments to the two subsections arising from this change.

Finally, because we are removing the requirement to send copies of the examiner's report under section 170 to the Registrar of Companies, a consequential amendment is necessary to section 182. That section requires notice of delivery of certain documents to the registrar to be published in Iris Oifigiúil but since we will not now be requiring the examiner to send the report involved to the registrar in the first place, the question, therefore, of publicising such delivery to the registrar clearly does not arise.

I thank the Minister. It is probably late in the debate to be asking quizzical questions. I am intrigued by the fact that in amendment No. 45 we require certain information in the report to be supplied under that subsection and in amendment No. 47 certain information in the report to be delivered under that paragraph. If I were going to be awkward I would ask the Minister the difference between supply and deliver, but I will not.

Amendment agreed to.
Government amendment No. 48:
In page 136, to delete line 30.

Acting Chairman

This amendment has already been discussed.

Amendment agreed to.

Acting Chairman

We now come to amendment No. 49. Amendments Nos. 50 and 51 are related.

I move amendment No. 49:

In page 139, line 16, after "resign" to insert "or retire".

The Minister is aware of my previous comments on this matter and this is an opportunity to reiterate them. I would be concerned that an auditor, who would be liable under the legislation if he did not disclose information to the court or to the Minister on finding a company's affairs not in accordance with the Companies Act, could resign at the following annual general meeting. I would be concerned that he would, just before the annual general meeting, decide to drag his feet on the matter and perhaps retire, rather than resign. The word "resign" has connotations that generate a certain suspicion about the reasons for resignation, even though they might be quite legitimate. The word "retirement" is a nice, gentle word that does not suggest any such suspicions. It is just splitting hairs, as it were, at this stage, but it is worthy of inclusion in order to cover all the situations that could arise under this section.

It was suggested on Committee Stage, and Senator Hogan has now again made the point with his amendments, that some auditors who were not happy with the state of affairs in a particular company might, rather than take the step of resigning, take instead the softer option of not seeking re-election, thereby sweeping any doubts that they might have under the carpet, as it were. I agree that this is a gap that might usefully be filled and Government amendment No. 52 would, therefore, require an auditor who was not seeking re-election to make the same kind of statement of circumstances as an auditor who actually resigns.

This achieves the same thing as the Senator's three related amendments, but without making particular reference to an auditor retiring which, as I said on Committee Stage, was not a phrase or a concept with which I would be very comfortable. For this reason, I suggest to the Senator that Government amendment No. 52 achieves precisely what he may wish to achieve, that is, to get this statement of circumstance put in place where an auditor is not seeking re-election, thereby, in effect, taking care of the retirement aspect of his argument.

Amendment, by leave, withdrawn.
Amendments Nos. 50 and 51 not moved.
Government amendment No. 52:
In page 139, between lines 43 and 44, to insert the following:
"(5) This section shall also apply to a notice given by an auditor under section 160 (2) (c) of the Principal Act, indicating his unwillingness to be reappointed.".
Amendment agreed to.
Government amendment No. 53:
In page 141, line 9, to delete "(1), (2)", and substitute "(2), (3)".
This is a drafting amendment and is consequential on an amendment we made on Committee Stage. Its only purpose is to correct the cross reference in subsection (6) and it should refer to contraventions of subsections (2), (3) or (5) and not (1), (2) or (5).
Amendment agreed to.

Acting Chairman

Amendments Nos. 54 and 55 are similar and may be discussed together.

Government amendment No. 54:
In page 146, line 20, to delete "two", and substitute "five".

Amendment No. 54 is a fairly straightforward drafting amendment and would simply increase the time period within which subsidiaries and their auditors must answer questions posed by the auditors of holding companies. It is in response to a request made by Senators on Committee Stage. I notice Senator Hogan has put down an identical amendment and I trust he will not have any difficulty with my version of it.

I am glad that almost at the completion of this debate the Minister and I have eventually conformed to agreement on this matter. It is appropriate on the completion of Report Stage that we would have identifical minds on something. For that reason I would obviously be happy with the amendment.

Amendment agreed to.
Amendment No. 55 not moved.

I move amendment No. 56:

In page 147, to delete lines 3 and 4.

Under this amendment the lines I propose to delete refer to "officer" in subsection (5) in relation to a company which includes any employee of the company. I would be anxious to have clarification in relation to the employee of the company who might become involved in the penalties that might be invoked for a statement to the auditors. I mentioned on Committee Stage what I am concerned about. A situation could arise where a storeman or somebody keeping store records is asked by the auditors for statement into the affairs of the company and because of some mathematical error or some very simple error that could lead to a significant breach of company law, without the knowledge of the employee and without there being a deliberate attempt by the employee to give false information. For that reason the two lines I have referred to should be deleted from the section. It could lead to problems that we might not foresee now. It could lead to unfairness in the case of an employee who might have glossed over something without any deliberate attempt to falsify records and as such distort the statement that might be issued by the auditor. For that reason I am proposing this amendment.

This amendment proposes the deletion of section 197 (5) from the Bill thereby excluding ordinary employees of a firm from the penalties prescribed under section 197 in general. It appears that the Senators are concerned that company directors and other officers may be able to evade their responsibilities by shifting the blame for providing false information onto the ordinary company employees. Existing company law places obligations on companies and their representatives to provide auditors with various information and explanations. In carrying out his duties the auditor regularly obtains information from individuals within the company. Section 179 makes it a criminal offence for any officer or employee of a company to give deliberately false or misleading information to the company's auditors or to fail to give any information which those auditors require or are entitled to require.

The reality of the situation is that the auditors should be able to obtain information from individuals at every level of the company structure, in other words, directors, officers, middle management, ordinary employees and so on. Where irregularities exist in a company some or all of these parties are likely, perhaps certain, to give misleading, deceptive or downright false information to the auditor in a bid to cover their tracks. It is useful and desirable to concentrate the minds of company officers and employees alike by inserting a specific duty here to be truthful in their dealings with auditors. Having said that, I am satisfied that the aim of the new section 197 (5) is not to set up employees to take the fall for others, like the directors and so on, rather it would put the onus on employees to be aware of the accuracy or otherwise of information they give to auditors and to ensure that they are not being used, be it willingly or not, to carry false information to the auditors. I would remind the House that we are talking here about an officer of a company who knowingly or recklessly makes a statement. We are not talking about something which the Senator may have mentioned — that the employee would just gloss over or not notice something, it is knowingly or recklessly.

Amendment, by leave, withdrawn.

I move amendment No. 57:

In page 150, between lines 28 and 29, to insert the following:

"202.—(1) Notwithstanding anything contained in the Companies Acts every company to which the said Acts apply shall disclose full details of all contributions in benefit or kind made to political parties registered under the Electoral Acts, 1963 to 1986, or to a registered body on the Register of Nominating Bodies under the Seanad Electoral (Panel Members) Acts, 1948 to 1972, or to any political religious lobbying groups (including SPUC and Family Solidarity).

(2) Failure by a company to comply with subsection (1) shall be an offence under this Act.".

I am not going to rehearse all the arguments I entered into no later than last week because that would be tedious. I would like simply to explain why this appears here and why there are certain variations. I argued strongly, as did my colleague, Senator Ross, in favour of the principle of this. The principle seems quite clear and established, that in a situation where we require certain disclosures under the Companies Act it seems only an extension and a logical extension of this principle, that we should also require the disclosure of contributions by companies to political parties. I do not intend to suggest that there is massive or large ranging corruption in this country but I do think the public are entitled to know. They are entitled to disclosure. The reason there are certain variations is because I was advised that it is technically inappropriate to put down the same amendment exactly and so some adjustment or variation of the text was required. I decided to display my bona fides by including contributions involving the very Seanad panels under which I am elected myself to show that I should not be above the revelations included in this Act.

I also specified political and religious lobbying groups, not in any desire to impugn those bodies but the ones named have played a very significant role in the development of political life in this country and elements not too far from this particular section of lobbying have alleged in the past that I was but the spearhead of an international conspiracy to corrupt morals, financed by American money. That is fine but I feel that what is sauce for the goose is sauce for the gander and I would like to know, and I would simply give these as examples simply to illuminate and to clarify and not to impugn. Because it could be taken that this is an unjustified, nasty and mean-minded attack by me on these organisations, it is important for me to say that I regard them as perfectly entitled to lobby.

On this matter, in parenthesis, I would like to say that there was recently some small controversy in the newspapers involving a member of Seanad Éireann in which it was alleged that postage had been misused by making it available to groups just like these. I would like to put on the record of the House that I do not think that was an abuse at all. I think this was perfectly legitimate.

I do not happen to agree with the aims or intentions or some of the methods of the people involved in these lobbying groups, but it is one of the functions of public representatives to assist in lobbying for certain specific political interests. I am quite happy to confess and acknowledge here that I have also made envelopes available so that the interests and the causes in which I believe shall have an opportunity for the widest possible discussion. I wish to clear the air in case people think there is anything meanspirited, vindictive or under-handed in my naming of these. It is a matter of historical record that they played a role and I think we are entitled to know if they were being supported. In the same way, I am not impugning either the Fianna Fáil Party, the Fine Gael Party or Independent Senators by suggesting the public has a perfect right to know from where they get their funds.

It is remarkable that there was general agreement around the House that this was so. From the Government benches there were certain murmurs of assent. They did not actually emerge in specific syllables that could be tied down on the legislative parliamentary record but there were murmurs of assent. There were clear statements of qualified assent from this side of the House from the main political parties, but they all thought it was a little bit too trivial to deal with. I do not believe for one minute that the public believes that it is too trivial to deal with and it was suggested that, although this was a useful exercise and that perhaps the public had the right to know and that, even if it was only a matter of reassuring the public imagination it was appropriate, but this was not quite the place to do it. It obviously is the place to do it. I am surprised at the reluctance. I wonder why the political parties were so reluctant to commit themselves in this area.

The principal reason that I put this back on the Order Paper in altered form was that technically my previous amendment was rolled in with a Labour Party amendment and, as they did not call for a vote, I was not entitled to call for a vote. I would like to see on the record of this House the actual position of the various political parties with regard to the question of donations, benefits in money or in kind to their operations from companies under the Act. I welcome this opportunity to discuss this in greater detail and also perhaps having the opportunity to call for a vote.

Acting Chairman

Is the amendment seconded?

I will second the amendment with a certain degree of reluctance. I have already explained this to Senator Norris. I am somewhat surprised that the amendment is still on the Order Paper given the reference to two specific organisations that are contained in it. Nevertheless I second the amendment for the very simple reason that, whatever about my disagreement with some details of the wording, I am an enthusiastic supporter of the principle behind it.

All Members of both Houses have grave difficulty in facing up to the fact that the public at large have a low and declining view of us on all sides of the House with very few execeptions. Incidentally, the only other group held in such low esteem are people in journalism. We tend to be equally held in low esteem in most opinion polls in the United States and in the United Kingdom — politicians, journalists and trade unionists are the three least liked categories. Still, in spite of all you might say to the contrary, the clergy are amongst those who are thought most highly of and we will have to live with that whether we like it or not.

Part of the reassertion of our position in society and of our right to be held in somewhat higher esteem and to be respected would be a willingness to disclose our interests. I do not believe there are many Members in this House who would be embarrassed if they were to disclose their alleged riches because from what I have learned, and I have learned this over the past seven years, anybody in this House who had money before he or she entered this House or the other House would have less leaving it. Those who came in without any will exit in debt.

It is the same in the other House.

I was including both Houses.

It does not apply to Ministers.

By and large, there is a public perception that people get rich from their involvement in politics. The simplest and the most painless way of getting rid of that would be by disclosure. Equally, there is a view that various people are being bought off by various other people. Disclosure of contributions to political parties is one way of doing it. It is well known that two if not three of our major political parties actively solicit support during election time from corporate bodies. Since they are quite happy, and there is no reason why they should not seek such support, it seems only right that the public ought to know the degree and extent to which companies which, after all, are operating under that particularly privileged status of limited liability use their funds to support various political organisations.

The major reason I am interested is not so much because of the interesting information we would have disclosed about companies but because of the fact that it would again clean up the image of politics. In the same way as we should have a register of our interests, the register of those who contribute funds to politics ought to be made public. I understand that in the United States, even though the sums involved are astronomical by our standards, all of the funds have to be publicly identified and the sources publicly acknowledged. It would be very healthy for our political process to do so and it would be equally healthy, and Senator Ross is quite right, to extend that disclosure into other areas where people apparently have large sums of money available to them for various forms of lobbying, quite correctly and properly. People are entitled to lobby. Those of us in this House or the other House can never complain because it is a form of public participation in the process of government, the process of legislation.

If Senator Norris was going to introduce one or two organisations I could have given him a list of a couple of dozen, some of whom I agree with, some of whom I do not, but they could have been added on to this. Nevertheless, the fundamental principle is that openness in Government, openness in politics, openness about financial interests is the sort of bedrock on which we can rebuild a higher level of public trust in the political Process. At this stage I know that most people in politics, whatever they are in it for, it is not because of any illusion that they are going to make money out of it. The least we could do for ourselves is to make that known to the public at large. The simplest way to do that is to let them know the truth. None of us have that many secrets to hide, at least none of the Members I know in either House have that many secret resources in hiding either here or outside the jurisdiction which they would have any reason to worry about. Similarly, contributions from corporate entities, whether they be large or small, is the sort of information that again would improve the climate of politics in this country. The amendment and the principle behind it are extremely important to increasing and improving public perceptions of politics in this country. That is why I support it.

The funding of political parties is a much broader issue than just the reform of companies legislation. There are two sides to the debate, the company making the donation and the future funding of political parties by companies or by the State. In the future we must address the funding of political parties either by companies or by the State, or a combination of both. Proper research facilities, back up services, educational services are expensive overheads for political parties but they are vital for the continuity of democracy. I hope that, in the not too distant future, we will have a Bill before this House to deal with the funding of political parties.

This is more or less the same amendment as was put down by Senators Norris and Ross on Committee Stage although I think, as Senator Norris said, it has been expanded somewhat. We had a full debate on this matter on Committee Stage and I listened very carefully to all of the points made at that time. I explained fully my reasons for not accepting amendments to the Bill on this issue and that is still my position. I did not think that the issue was appropriate in the context of a Companies Bill and that the question of contributions of this kind is really part of the broader issue of the funding of political parties generally. If this issue needs to be looked at, it would have to be in that broader context and not just in companies legislation.

I also said that I would be very concerned if the provision of political contributions had adversely affected the trading performance of any companies or if it had resulted in any company failures. However, I have no evidence whatsoever in recent receiverships or liquidations which indicates that the companies difficulties were caused, worsened or affected in any way by any such contributions. Again, I should point out that if companies wish to voluntarily disclose their contributions to anybody they are fully entitled to do that and if shareholders wish to ask about contributions at any meetings they are fully entitled to get that information. I do not think this legislation is the way in which we should attempt to deal with the broader question of the funding of political parties. I am unable to accept the amendment.

I am not convinced that the Minister is correct — although, of course, with his superior wisdom and advice he may be correct — that shareholders are entitled to all this information as of right and automatically. This may be the base but I do not believe that it is. The Minister has said, of course, perfectly correctly, that companies are entitled to give this information already. Of course they are. Who is to stop them? I am not suggesting that they are not entitled; I am suggesting that they should be compelled and it is the purpose of legislation to compel them to do so.

I also think it is little bit disingenuous of the Minister to say that he is not aware and would be concerned if he felt that companies were adversely affected by making contributions to political parties. I should like to place on the record of the House that I would be a great deal more concerned if companies were positively and favourably affected by making contributions to political parties. That is precisely the point the plain people of Ireland are worried about.

Without drawing in a red herring, I should like to make the point that Senator Ryan's speech was very well made, timely and appropriate in the light — and I am not raising specific issues here — of the kind of rather uncomfortable situation existing slightly lower down the political scale in Donegal County Council where there appears to be, from the newspapers, considerable concern that attempts were made to introduce a financial motive into the process of regulating the affairs of a county council. That is probably sub judice at the moment but this is a context in which people will be very concerned. They will not be at all concerned as much with the possibility that companies may be adversely affected as by the fact that there may be a public belief that they could be positively affected by making contributions to political parties.

The Minister has an extremely clear, lucid and logical mind and has presented us with a fine piece of legislation and one which has shown considerable generosity in accepting the role of Seanad Éireann in making certain ameliorations to the legislation. I can understand why he does not want what he might regard as inelegant and extraneous material corrupting the beauty of line of his legislation. However, the opportunity exists here to address this problem and I do not for one minute believe that there is an immediate prospect of the Government introducing legislation dealing with the funding of political parties. It is just a little bit too bland for spokespersons from the Government side to say: "Well, this is not directly relevant and, of course, we will be considering...". Governments have been known to consider things like this for 15 or 20 years and do absolutely nothing whatever about them. I believe this is precisely the position. If there is legislation in preparation I would be very glad to know about it but as of the moment, without a direct ministerial assurance, I do not believe it for a moment. This is the moment at which we should address this subject.

I applaud the Minister on his clinging to the highest aesthetic standards of legislation but I would point out that in this he is virtually alone in the present Administration. They have shown no reluctance whatever to introduce completely extraneous material into other Bills simply because it suited them so in a matter of political ethos and credibility. I do not think too many points will be lost by making this adjustment. I hope the Minister will be able to reconsider and accept this amendment.

Acting Chairman

Is the amendment withdrawn?

An Leas-Chathaoirleach

The question is: "That the amendment be made." On that question a division has been challenged. Will those Senators calling for a division please rise in their places?

Senators Harte, Norris, O'Shea and B. Ryan stood.

An Leas-Chathaoirleach

As fewer than five Senators stood in their places I declare the question lost. The names of the Senators who stood will be recorded in the Journal of the Proceedings of the Seanad.

Question declared lost.
Amendments Nos. 58 and 59 not moved.
Question, "That the Bill, as amended, be received for final consideration", put and agreed to.
Agreed to take Fifth Stage today.
Question proposed: "That the Bill do now pass."

The Minister has obviously left——

A Senator

No, he is here.

What I have to say is simply complimentary to the Minister and I would have preferred to say it in his presence.

An Leas-Chathaoirleach

I would like to point out to the House that the Minister is waiting for the division to conclude.

It is rarely that legislation of this magnitude is initiated in this House. There have been a number of pieces of legislation but this is by far the longest and most complex piece that has been initiated in this House in my period in the Seanad. When I was first elected I never imagined I would end up following, even in a slightly haphazard way, the ins and outs of something as complex as company law.

I would like to compliment the Minister, and obviously the Government, for the way in which they dealt with this Bill in this House and I think the Members of this House who participated in this debate responded in kind. It was an intelligent debate based on a consensus about the need to improve the area. There were disagreements about details, but the fundamentals were all the same and I want to compliment the Minister for that, and through him I want to compliment the officials of his Department who, obviously, have put an enormous amount of work into this and by whom, let me say, the Minister is well served in the quality and flexibility of the advice he has got. It is really the sign of somebody who is in command of a brief to be able to listen to arguments and say sometimes, "Yes, that is worth pursuing" and sometimes, "No, that is not worth pursuing." Therefore, I want to compliment the Minister. The last occasion I saw this to a similar extent was when the then Minister of State who is sitting in front of me was bringing the Status of Children Bill through the House and a similar degee of flexibility was shown.

I wish the Minister well in the other House where perhaps relations on both sides may not be quite as civilised as they were here, but I think he has at least got most of the arguments straightened out whatever about the politics of it. Therefore, he will be well prepared for the other House.

Finally, I think the Minister and Members of the other House should propose that everybody who worked through this Bill should be exempted at least from the first two examinations of the Bar Council in the way juries are exempted from jury service after a long trial. We should be exempted from something.

Senators

Hear, hear.

I now believe we should be exempted from at least two examinations for that. I compliment the Minister on the way he handled the Bill.

I would like to join with Senator Ryan in paying tribute to the Minister of State and, of course, to compliment the various spokespeople here for the excellent job they have done in examining all aspects of this Bill. As Senator Ryan said, it is the most major reform in the company law area since the passing of the Principal Act in 1963.

It seems to me in regard to part II of the Bill that the departure in section 10 (5) from the existing legislation is very dubious and, I suggest, unconstitutional. I believe this provision, as has been indicated by Mr. Justice Keane, President of the Law Reform Commission, is a serious defect. I realise I am stretching a point, but I will be as brief as possible in this matter. Basic to Part II of the Bill is the power of the inspector to require officers and agents of the company and other persons to produce documents and to give information. Under section 168 (3) of the Companies Act, 1963, where a person refused to produce documents or give information, the inspectors could certify the refusal under their hand to the court and the court could thereupon punish the offender in like manner as if he had been guilty of contempt of court.

Section 168 (3) of the 1963 Act was amended by section 7 of the Companies (Amendment) Act, 1982, so as to provide that a person who declined to co-operate in this fashion would be guilty of an offence and liable on summary conviction to a fine not exceeding £500 or imprisonment for a term not exceeding six months or both, or on indictment to a fine not exceeding £5,000 or a term of imprisonment not exceeding three years or both. In this new legislation the parliamentary draftsman obviously has gone back to the old formula used in the 1963 Act. Therefore, I would have expected — the Minister has an excellent back-up team — that the Minister would have been aware of the old formula, that is providing for a certificate by the inspector that the person has failed to answer the questions or to give the information and being punished by the court in like manner as if he had been guilty of contempt of court.

It seems clear that the 1982 amendment was introduced because of misgivings about the constitutionality of section 168 (3) of the 1963 Act. Indeed the leading case in this regard is re Haughey, 1971. I assume, therefore, that the parliamentary draftsman has gone back to the 1963 formula because the inspectors would now be acting under the order of the High Court and there may perhaps — I stress the word "perhaps"— be no constitutional frailty in equating the refusal to answer questions or produce documents with contempt of court.

However, like Mr. Justice Ronan Keane of the High Court, I have very serious doubts as to whether the investigation conducted by the inspector, even where the inspector is appointed by the High Court, can properly be described as the administration of justice. Indeed the jurisdiction conferred by the High Court is a very unusual one. The High Court, as the Minister has indicated, has virtually an untrammelled discretion as to whether to make an order. While the court may, on receiving the report, make an order winding up the company, the court is also free not to make any order whatsoever.

The procedure, in short, lacks all the indicia one would normally associate with the administration of justice. The court resolves no justiciable issue whether between private individuals as in civil proceedings or indeed between the State and private parties as in criminal proceedings. It does no more than set in motion a process of inquiry the result of which does not of itself affect any party's rights in the slightest.

In conclusion, I will briefly describe what Mr. Justice Keane said in his address to the Limerick Chamber of Commerce:

To describe the investigation as part of the administration of justice in these circumstances seems inappropriate and none of the reasons which moved the Supreme Court in The State (D.P.P.) v. Walsh (1981) IR 412 to reject trial by jury as an appropriate method of dealing with contempt seem to be applicable. Indeed, the draftsman——

An Leas-Chathaoirleach

Senator Kennedy, I dislike interrupting you but you should keep your comments brief.

I will conclude. Indeed I want to emphasise that the draftsman appears to have been conscious of this since he expressly does not provide that the person concerned is to be guilty of contempt of court but rather is to be treated as if he had been guilty of contempt of court. I would much prefer if the machinery which was used in the 1982 Act and which the Minister is aware of was to be reinstated and I hope it is done when the matter is considered in the Dáil.

This very lengthy legislation has been well debated. The underlying aim of the Bill as expressed in the memorandum is to create a climate of confidence for business activity in which genuine commercial development will prosper. I believe the Bill will achieve this objective. The Bill is the first major update in Irish company law since 1963 — I understand that that Act was based on the 1948 UK Act. It, therefore, incorporates requirements which have accumulated over almost 40 years and reflects changes in commercial practice that have taken place during that time. The Bill has addressed many important issues dealing with increased powers for company inspectors, insider dealing, the whole area of limited liability, preferential treatment in the case of winding up and so on. The Bill will help bona fide businesses in Ireland to develop their industrial bases and to prosper. By its enactment it will eliminate fly-by-night operators, rogue directors and unfair competition which is to the detriment of many honest and worth-while businesses in this country.

I compliment the Minister and his supporting team for the way they have guided this Bill through the Seanad. I would like to pay the Minister a special compliment for the way he has taken on suggestions from many people and interested parties. Many changes have been made during the course of the Bill's passage through the Seanad. It is much better legislation now than the Bill which was introduced here nearly 18 months ago. It provides the necessary updated legislation which will allow companies to prosper, particularly with our position to Europe in 1992.

I would like to add my voice of relief at the fact that the Companies (No. 2) Bill has been completed in the Seanad. It has been under discussion here since May 1987 and Senators have made enormous contributions in bringing about changes where they were necessary. The number of amendments that were introduced by the Government is an indication of the thorough examination of the Bill in this House. There were about 250 amendments in all on Committee Stage and 59 amendments were proposed on the Order Paper today for Report Stage. That is an indication of how serious Senators discussed and analysed the impact the legislation will have on the day-to-day activities of the business and commercial life of this country. The many precedents from various parts of the world which have been looked at in order to improve the legislation are evident in this Bill. Neverthless, the Minister has quite rightly introduced the modifications that are necessary to take account of our unique commercial activity in Ireland.

The new concept of the examiner is something that we look forward to with great eagerness and zeal to see if it is possible to reconstruct many companies that unfortunately go into receivership or liquidation, perhaps in many cases through no fault of their own, because of the lack of preferential status. I hope the examiner will be able to bring about viability for many companies who find themselves in a very difficult financial position.

I hope the Minister will consider the possibility of bringing forth an explanatory memorandum as soon as possible in order to ensure that the business and commercial life understand the impact which this legislation will have. Each business person should, to the fullest possible extent, be made aware of the impact which this Bill will have on the many commercial practices they were used to. It must be emphasised that the necessity for this legislation comes about because of a minority of directors who failed in their duties and responsibilities. It is important that that is stressed because there are many people who would think that any person involved in business is a rogue trading fraudulently and recklessly. This House should extol the virtues of limited liability and of people who take risks and often go unrewarded. If they fail at least they will have tried. What is important in relation to the building up of a business enterprise in any country is that people are prepared to invest, take a risk, and if they do not succeed they will have the confidence restored in them to try again. I wish the Bill every success.

I know that there will be further modifications made in the Dáil but the major work has been done in this House. I would like to compliment the Minister of State on the manner in which he accepted the amendments that were proposed and through him, his officials on the enormous amount of work that went into the preparation of the amendments and discussion of this Bill.

I, too, would like to take this opportunity to congratulate all concerned in the passage of this important Bill, particularly, the many Senators who took part on Committee Stage on my own side, Senator Mulroy in particular.

It is a long time since I and other Members of the Seanad spoke on the Second Stage. I can only offer my sincerest congratulations to the Minister of State who had a total commitment to and perfect understanding of the Bill and was ready, willing and able at all times to receive, and accept in good faith what he regarded as appropriate amendments. The one which pleased me most was the amendment which the Minister put forward regarding the cooling off period, whereby the assets are frozen, an examiner is appointed and there is a period of three or four months while everybody remains calm, cool and collected in an effort to bring about a successful conclusion to a difficult situation. We all know of hundreds of companies that have gone to the wall where liquidators were appointed which, had this rescue package been available, would have been saved. This breathing space is something innovative and I congratulate the Minister sincerely on introducing it. It will have beneficial effects for the industry of the future. I wish this Bill every success. It is important for the Ireland of the future. I congratulate all concerned, particularly the Minister of State, for his work on this Bill. I congratulate also his officials and the Senators who took part in much of the discussion on Committee Stage.

On behalf of the Labour Party Senators, and on my own behalf as a new Senator, I, too, would like to congratulate the Minister on the very constructive and open-minded way he contributed to the debate here. What was clear at all stages was that his bottom line objective was to get the Bill right. It was by far the best performance I have seen by a Minister in this House particularly on such complex legislation.

With regard to the Bill itself, we in the Labour Party would like to have seen some provision for the disclosure of contributions from companies to political parties but the House saw fit to decide otherwise. It remains for me now to say on behalf of the Labour Senators that we wish the Bill every success when it is passed into legislation. We hope that it achieves what it sets out to do, strengthen enterprise and thereby improve job creation and job security. Once again, on behalf of the Labour Party, my congratulations on an excellent job.

As someone who, like Senator Fallon and my other colleagues, spoke on the Second Stage of this Bill such a long time ago, I would not like the occasion to pass without adding my vote of congratulations to the Minister and his officials. The Minister, Mr. Albert Reynolds, said at the outset in his introduction to this Bill that he would be adopting a flexible approach. It is quite obvious from the number of Government amendments that the Government were not seen wanting in this regard. I also would like to add personal congratulations to Minister Brennan who took the bulk of this Bill through the Committee and who is now taking it through the remaining Stages. His depth of knowledge did not surprise those of us who know his background and his meticulous application to any job he takes on board.

I would also like to welcome the Bill in the context of the impact it will have on the consumer. It is this aspect of it, the so-called phoenix syndrome, that might not have been touched on or emphasised as much as the enterprise from a business context. Perhaps we will see the death of the rogue phoenix and the birth of the pure virginal phoenix. There is no disgrace in business failure. Indeed, in America a famous banker once said he would much prefer to give money to a bankrupt than to someone who had no experience of business. In that context the various comments which have been made by my colleagues here in relation to the impact the Bill will have on the entrepreneurial spirit of the Irish people is something that all of us would welcome in the shadow, as we are now, of 1992.

I would hope that when this legislation becomes law it will not scare off any honest diligent would-be entrepreneurs. The fear has been expressed as the debate progressed through the House that there might be a danger of over-legislation in the area. After all, the environment for business needs to be flexible, as the Minister knows. One hopes that now that the legislation has been put in place it will be utilised to market our country by giving as much encouragement as possible to would-be entrepreneurs to set up business, to properly research their product and their market. I have no doubt whatsoever, when one looks at the track record of the Minister of State in this area that combined with his enthusiasm and freshness of approach to this whole area of marketing, Ireland can make up the ground that it has undoubtedly lost over the last two decades in the area of marketing Ireland and her products abroad.

I enthusiastically welcome this legislation and hope it has as detailed but relatively easier and shorter a passage through the other House than it had here.

Let me say sincerely to the Senators here how much I appreciate their sentiments by which I really am touched. We have come through a long pilgrimage here together. It has been over a year. We are about to put through a Bill of some 207 sections. We have added to that and dealt with some 220 amendments. We have dealt with, arguably, the largest most complicated piece of legislation to come before this House in decades. The Senators are entitled to be justifiably proud of that work. Whether all Senators got precisely what they wanted from this Bill or whether the Government did, does not matter that much at this stage. What matters is that between us we have put together a Bill that we can proudly hand to the Dáil asking for its support and endorsement.

My particular thanks go to Senators Hogan and Mulroy who, through long hot summers and many a long day in this House, slaved with me on this legislation. My thanks go also to the famous backbench down there where the three Rs — Senators Ryan, Ross and Robinson — played a major role in many of the amendments to this Bill. Senator O'Toole's amendments proved very useful in improving the legislation. On behalf of my officials I wish to accept the Senators' kind remarks. I know that Senators appreciate, as I do, the work they have put into this Bill.

In conclusion, we are trying in this legislation to strike a balance between, on the one hand, preventing abuse of limited liability and, on the other, to have this Bill seen not as a cowboys' Bill but as a Bill designed to promote industry and enterprise. I am quite satisfied that we have struck that balance in this Bill. On the one hand, it will root out abuse where it exists and, on the other, it will encourage enterprise. I put a lot of faith in the new Chapter 11 type rescue system which many Senators have referred to. That is the system which will allow us to put a company into cold storage effectively for a three, if not four, month period and allow its debts to be frozen for that period so that no one would be able to sue the company. During that period an examiner will try to put that company back on the road. In other countries this system has saved hundreds of companies. I believe that, had we this system in operation in the past, many a fine company would have been saved. I am quite confident that it will save many a fine company in the future. Therefore, I put a lot of trust and faith into that new system and I look forward to seeing it in operation.

Finally, I express once again my thanks to Senators. All I can say is that I hope Dáil Eireann will be as reasonable and as sensible in respect of this legislation as Senators have been.

Not a chance.

An Leas-Chathaoirleach

The Cathaoirleach and I wish to express our thanks to the House for the way in which it dealt with this legislation. Indeed, it was difficult enough. We tried to allow the widest degree of latitude possible and we are glad that it has culminated in what I consider to be quite an improvement on the Companies Act, 1963, which is one of the longest pieces of legislation I have ever had to deal with since entering this House.

Question put and agreed to.

An Leas-Chathaoirleach

When is it proposed to sit again?

It is proposed that the House adjourn sine die and that the matter on the Adjournment be taken at 6 p.m.

An Leas-Chathaoirleach

Is that agreed? Agreed.

Sitting suspended at 5.05 p.m. and resumed at 6 p.m.
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