——who understandably believed that an Irish State company would not renege on its commercial obligations. The consequences of this commercial immorality by the Government will have far-reaching repercussions both here and abroad. If the Government have reneged in the case of a viable trading company like this, what are they likely to do with the debts of a company that clearly is not solvent like CIE?
In this connection it is worth quoting two brief messages sent to the Government by two of the foreign creditors to show the extent of their amazement. The first is dated today's date and is a telex addressed to the Minister of Economical Affairs of the Government of Ireland, Dublin and reads:
Re: Chipboard Scarriff
We are regular suppliers of material for the manufacturing of veneered chipboard for many years.
As the Irish Government is the main share-holder of Chipboard Scarriff we understand that payments are and have been guaranteed by the Irish Government for our deliveries.
Therefore we trust that our outstanding invoices are going to be paid.
Yours faithfully,
Van Hout B.V.
The other is addressed to the receiver of Chipboard Products Limited, Scarriff, from Karl Danzer of Reutlingen, Germany, and reads:
Dear Sir,
We are extremely concerned with regard to the situation which has now arisen with Chipboard Products Ltd.
We have supplied a considerable quantity of veneer which was done in good faith on our understanding that the Irish Government had a substantial majority stake in the company and as such, would have a credit viability.
It would seem that our faith in your government's commercial integrity has been misplaced and perhaps you would be good enough to give us some explanation as how this situation has possibly occurred.
Yours faithfully,
Karl Danzer.
I understand that a meeting of creditors of this company was held in Dublin this afternoon at which the foreign creditors said they dealt with State companies where the State had a majority of the shareholding in all the countries of Africa and all the banana republics of South America and never had a State company defaulted. They were amazed to find that this was happening in respect of a State company in supposedly civilised western Europe.
To put it in concrete terms as to what this means as a consequence of the Minister's action, at the meeting this afternoon a major oil company in this country which was a supplier to Chipboard Scarriff, stated that from now on they will not supply Irish State companies except on a cash and delivery basis. This has enormous consequences for companies like Aer Lingus, CIE and many others. It demonstrates the results of the kind of situation which has been brought about by the Minister for Fisheries and Forestry in a very vivid way.
In the shareholders' agreement between the parties the Minister undertook to observe normal commercial practices and standards and, inter alia, to provide a guarantee for the bank. He commissioned a technical report on the company but will not show it to the directors. That report and details of the company were hawked around to potential competitors further damaging the interests of minority shareholders.