Vol. 402 No. 7
3 Mr. S. Barrett asked the Minister for Industry and Commerce if, in view of the difficulties which have arisen with the workings of the Companies (Amendment) Act, 1990, since the appointment of the examiner to the Goodman Group, he has any proposals to amend this legislation in order to make it more effective; and if he will make a statement on the matter.
As the Deputy is aware, the Companies (Amendment) Act, 1990, had its origins in Part IX of the Companies (No. 2) Bill, 1987. When this Bill was being considered by the Special Committee of this House, a number of matters were raised which I undertook to reflect on before Report Stage. Time did not permit me to complete my consideration of these matters before the Companies (Amendment) Act, 1990 was moved.
In the circumstances, I expect to be bringing forward some amendments to the Companies (Amendment) Act, 1990, at Report Stage of the Companies (No. 2) Bill, 1987, not only in relation to the points raised at Special Committee, but also in regard to other matters that have come to my attention in the meantime.
How does one ask supplementaries on a reply like that when one does not know what amendments the Minister proposes tabling? In relation to the operation of the Act since it came into being, would the Minister agree that it is quite clear that a number of factors have arisen, in particular in relation to the availability of finance to the examiner and the control of the company by the existing directors when the examiner had been appointed and that it is obvious that it will be much more difficult in the future for Irish businesses to obtain loans abroad at competitive interest rates because of the provisions of parts of the Companies (Amendment) Act, 1990?. Would the Minister agree with the points I have made and assure me that, when we come to deal with the Companies (No. 2) Bill, 1987, these matters will be tackled because, as matters stand at present, the obvious costs involved for any business in the appointment of an examiner— bearing in mind that we will have to revert to the courts so often — must bear heavily on the funds available for distribution among creditors after those costs have been met and excluded?
Would the Minister agree that the scheme of arrangements that can be put in place with a bare majority of one class of creditors is seen to be totally unfair, and, as I would see it, unconstitutional compared with what happens in other countries and will have serious effects on Irish businesses in the future if amendments to the Companies (No. 2) Bill, 1987, are not brought in as quickly as possible?
I do not want to go into the detail of the amendments I will be proposing; I hope to circulate them shortly. It would be better that we discuss their merits or otherwise on Report Stage which will be recommencing next Wednesday and which I certainly hope will finish in December because it is very important that it be enacted by Christmas. Therefore, I do not want to comment on the points the Deputy has made in regard to specific parts of the Bill.
However, I want to make two broad comments. One, it is wrong for the Deputy, or the public at large, to form judgments in regard to the Act passed here in August by virtue of the experience of the first examinership which took place under its provisions because that is unusually large and complex, in that there were 61 companies taken into examinership altogether, that is most, but not all, of the group in question. The examiner in that case has faced a monumental task. Since August there have been three other examinerships of the kind we would have envisaged as the norm. I understand that they are proceeding very smoothly and without difficulty. They are relatively small companies and relatively uncomplicated. I believe the Act is working very well in regard to them. We will bring forward amendments based on experience. But experience in regard to the main examinership that has arisen since August is not experience that will be valid into the future because I hope we will never again be faced with such a large and unusually complicated procedure as that.
The other point the Deputy made to which I want to reply now is his suggestion that that Act has made it more difficult for Irish companies to borrow money. I categorically want to say that we have no evidence of that. International banks, with whom Irish companies are dealing, have made it clear to us that our legislation is not dissimilar from that in the United States or Britain in these matters but is preferable, from a banking point of view, because it is not as open-ended as that prevailing in the two countries I mentioned. There are great advantages, even in as large and complex a case as the one we have seen, in having a time limit. That has focused people's attention on the fact that it is necessary to have that examinership completed in the month of December and decisions have had to be faced up to that might otherwise have been postponed.
Can the Minister say——
Question No. 4. The time for Priority Questions is fast running out and I am calling Question No. 4.
Surely there should be some control over the Minister's reply.
