Stephen Donnelly (Wicklow, Social Democrats) | Oireachtas source

The fear is that Revenue can tell smaller companies that while it knows they would like 15% applied to this it is going to be 5% and if they have a problem with that they can spend the next ten years litigating. The vulture funds do not have that problem. They are not scared of the Revenue Commissioners. They will walk in with a Lever Arch folder of 1,000 pages explaining very clearly and reasonably why a 14% mezzanine rate is absolutely above board. Given the scale of these funds, globally, it is not a deterrent for Revenue to say it has to go court. That is a deterrent for the small investor who might use section 110 but absolutely not for the vulture funds.

We as legislators then have no oversight. We cannot see in. There are only approximately eight vulture funds. They have lots of little companies such as Maris Capital 1, 2, 3, 4 but there are only approximately eight global vulture funds here. The Revenue Commissioners will have to do individual deals with them, for example, Oaktree, 14%; Cerberus, 7%; Lone Star, 16.5% or whatever. Two problems arise: one, we have no way of giving a view as legislators as to whether we believe 10%, 12%, 14% or 16% is reasonable; two, because they are individual deals with individual companies we will never know what deals have been struck. The lawyers and accountants are telling the vulture funds that even if they cannot use the existing arrangements they will be able to justify ongoing high rates that are absolutely reasonable commercial returns.