Anthony Lawlor (Kildare North, Fine Gael) | Oireachtas source

I wish to share time with Deputies Heather Humphreys, Andrew Doyle, Dan Neville, Joe McHugh and Marcella Corcoran Kennedy.

I thank Deputy Donnelly for producing the Bill. It is a difficult and onerous task to get a Bill before the Chamber and I welcome the good discussion on small and medium-sized businesses that are being affected by the recession. For the information of Deputy Tóibín, who said the country was developing only inside the M50, I happen to live just outside the M50, where there is a major indigenous company established just outside Naas. He might be aware of that. I am just trying to keep him informed of what is happening outside the M50 as well, in case he gets some peripheral vision.

I always look at a Bill to see what might be the benefits of it. While I agree substantially with the thrust of the Bill, the object of which is to drive down costs, I have to look at the way it goes about driving down costs and further examine who benefits - the debtor or the creditor. When one looks at this, one can see we have to protect the creditor as much as the debtor because the creditor is also, more than likely, a small business. If the creditor was directly afflicted as a result of what this Bill might bring, there is the potential for the creditor to lose his or her company and its employment. What concerns me initially is that this Bill is anti-creditor. We have to look at it and take care in that regard.

One issue highlighted within the Bill that Deputy Tóibín mentioned is that of upward-only rent reviews. While I agree that the cost of examinership is quite high, as Deputy Tóibín will be aware, according to section 510(7)(b) of the Companies Bill 2012, small businesses will be entitled to go under examinership to the Circuit Court. I welcome this as it will reduce the cost of taking the examinership route for small companies.

With regard to upward-only rents, for anyone who is in business and who has properties, the objective is to have the properties occupied. What I have seen through companies that have gone to examinership is that they have been able to negotiate downward rent reviews. We will all be aware of the international company B&Q, where more than 600 jobs were saved as a result of the pressure the examiner put on the owners of the property to reduce the rent. That is one benefit that has come about from a company being in examinership. I am aware that there are negotiations going on with regard to rent.

We also must look at whether, under the Bill, the company going into examinership will be a viable company at the end of it. That is key. If the creditors will suffer most as a result, it does not then make the company coming out of it viable. It might make companies that are marginal decide to take this route rather than trade themselves out of their difficulties, and that would lead to difficulties for their creditors.

With regard to the decision by a company to have an examiner rather than go through the court process, the court process gives an umbrella of protection for both the debtor and the creditor. While, under the Bill, the creditor must initiate court proceedings to regain some of the funds it might have lost as a result of the company's going into examinership, it is important that we protect both the debtor and the creditor by giving them some protection with this court umbrella.

I am concerned also that the examiner may have too much power under this Bill. We in government are driving down costs. According to the Doing Business 2014 survey done by the World Bank, Ireland is ranked 8th in the world for ease of resolving companies' insolvency issues. That is an important statistic to examine.

My view is that the Bill is a little too onerous, gives too much power to the examiner and does not protect the creditor. It is vitally important that we maintain protection for both the creditor and the debtor, but also reduce costs. This Bill is a little too onerous in that it places too much emphasis on the company in examinership rather than the creditor. It is our objective to drive down costs and we as a Government are doing that as much as possible.

See this speech in context