Seán Sherlock (Cork East, Labour) | Oireachtas source

I will explain the reasons I do not propose to accept the amendment. I understand Deputy Calleary, in his contribution on Second Stage, indicated that the Minister should consider a simplified version of the independent accountant's report and the application papers for the appointment of an examiner to streamline the application process. The current court process mirrors the requirements of the Companies (Amendment) Act 1990 in respect of the appointment of an examiner. Section 3 of that Act requires that a petition for the appointment of an examiner be accompanied by a report prepared by an independent accountant. Section 3(3)(b) sets out the areas the report is required to cover.

The Bill does not propose to change these arrangements because the report of the independent accountant is essential to assist the court in determining whether the company has a reasonable prospect of survival. If the court is not satisfied that the company as a whole or any part of the undertaking has a reasonable prospect of survival as a going concern, it is precluded from making an order appointing an examiner. Thus, the independent accountant's report is a crucial piece of evidence for the court to consider. It should explain, in a reasoned manner, why the independent accountant is of the view that the company, and the whole or part of its undertaking, has a reasonable prospect of survival.

The report must have regard to a number of important matters, as detailed in section 3(3)(b) of the Companies (Amendment) Act 1990. The appointment of an examiner to a company will interfere with the rights of creditors and it is, therefore, of the utmost importance that the independent accountant's report provides evidence that will satisfy the court that the company has a reasonable prospect of survival as a going concern and whether a compromise or scheme of arrangement with creditors would offer such a prospect of survival. Modifying the terms which underpin the report would create a significant risk that the rights of creditors and their businesses, which may also have employees, would be impacted further as the evidential threshold would be lower. The Office of Parliamentary Counsel has also advised that allowing the Minister to alter the arrangements in question by way of a statutory instrument would not legally be permissible as it would exceed the extent to which matters can be delegated to a Minister, having regard to the Constitution.