Seán Fleming (Laois-Offaly, Fianna Fail)
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As the Deputy rightly pointed out, this legislation, bearing in mind its original intention, has improved significantly in respect of identifying the identities of investors. If they are Irish, they will have to produce their PPS number, or the equivalent across the EU. Apart from that, a person will have to produce a passport. The Deputy has indicated that a company may sometimes have an investment in the investment limited partnership or in a fund under that partnership. Her question was on establishing the identity of the shareholders behind the company. There are two tests. If one owns over 25%, one is identified as a person involved, but if one owns less than 25% but has a controlling interest in the company, perhaps through other people, one is also deemed a person whose identity must be disclosed. The legislative phrasing is in line with the anti-money laundering legislation that is already in place.

If a person has a 25% shareholding, the owners of the remaining 75% control the company. A person with only 15% or 20% does not usually have a controlling interest but someone with a shareholding of less than 25% might have a controlling interest if he or she is working in league with other shareholders who also have shareholdings of less than 25%. However, only one person – we are talking about a person, not a company – can be the beneficial owner.

The important point is that it is up to the general partner in the investment limited partnership to satisfy himself or herself that he or she has all the documentation to get Central Bank approval. If that person does not do his or her job properly, he will lose the benefit of limited partnership and all the limited liability. He or she would then be open personally and have no protection under the legislation. The onus is really on the general partner to satisfy himself or herself regarding everybody who invests in the fund. If the general partner does not do his or her job, he or she will be liable to direct action by the Central Bank.