Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank the members and witnesses for participating in today's committee meeting. I remind them that all members are required to participate in the meeting either from within the meeting room or remotely from within the Leinster House complex only. Should a division occur, any members participating remotely will be required to make their way to the meeting room within the normal division time to vote before returning to their original location. I have a public health announcement. All of those present in the committee room are asked to exercise personal responsibility to protect themselves and others from the risk of contracting Covid-19. No apologies have been received. This meeting has been convened for the purpose of considering the Screening of Third Country Transactions Bill 2022, which was referred to the select committee by order of the Dáil on 24 September 2022. The purpose of the Bill is, among other things, to provide for a process to allow for certain transactions that may present risks to the security of public order in the State to be reviewed by the Minister for Enterprise, Trade and Employment. The Bill seeks to ensure that Ireland can meet its reporting and co-operation obligations as set out in EU Regulation 2019/452. I welcome the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Calleary, who is accompanied by his officials.

Dara Calleary (Mayo, Fianna Fail)
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Gabhaim buíochas leis an gCathaoirleach agus leis an gcoiste as a bheith linn le haghaidh an Bhille thábhachtaigh seo.

As members are aware, this Bill deals with sensitive and complex matters from a security point of view. The purpose of the Bill is to protect Ireland’s security and public order against threats emanating from investment from third countries. To achieve this, the Bill will empower the Minister for Enterprise, Trade and Employment to assess, investigate, authorise, condition or prohibit foreign investments based on a range of security and public order criteria and to prevent or mitigate such threats.

Establishing a formal investment screening mechanism represents an opportunity to design and tailor a system appropriate to Ireland’s needs and our approach will balance Ireland’s long-standing foreign direct investment strategy with an acknowledgment of the challenge posed by potentially hostile investments. The implementation of an investment screening mechanism will also provide reassurance to key trading partners that Ireland is a responsible global player, cognisant of the threat posed by the strategic and potentially hostile state-backed investment strategies being deployed by some third-country corporations. Ultimately, the development of an investment screening mechanism is in line with best international practice and is part of the broader trade defence toolkit of the European Union and Ireland. This toolkit includes our existing export controls regime, the implementation of sanctions, the EU’s international procurement instrument, a range of anti-dumping and anti-subsidy measures and the broader level playing field agenda.

I reassure the committee that this Bill in no way acts to dampen legitimate investment into Ireland. It is not envisaged that large numbers of transactions will require notification. Of those that are notified, it is likely that most will be quickly cleared without flagging any security or public order concerns. However, the Bill does provide a necessary safeguard against the actions of those who would do us harm or undermine our security.

Since the Bill completed Second Stage, we have had significant interest and engagement from key stakeholders, including many in the investment community, the legal sector, the enterprise agencies, the European Commission and bilateral trading partners. Based on these discussions and our own further research, we have identified a small number of amendments that are primarily technical in nature and which are designed to tighten up the operational processes, definitions and scope. This will ensure that the screening regime is focused on those transactions where the greatest likelihood of threats to security or public order arise. The amendments are also designed to provide as much clarity and certainty as possible to investors, ensuring that we are as clear as possible about the obligations and responsibilities which arise as a result of this legislation.

The proposed amendments, which we will detail later, focus on a number of areas. The first is ensuring that the definitions used throughout the Bill are as clear as possible. In particular, we have given attention to refining the definitions of “transactions”, “undertakings in the State” and “control”. This will ensure that only those transactions where risks are perceived fall within the scope of the Bill.

The second is refining the criteria relating to notifiable transactions to ensure that they are understood and interpreted correctly. Based on our consultations, we believe these changes will help minimise the number of unwanted notifications and will focus attention on the acquiring party, which is where most risks arise. These changes will also help to reduce the administrative burden and allow the State’s resources to be more efficiently utilised.

Finally, the amendments tidy up a small number of procedural issues. For example, they simplify the calculation for the date on which a screening review is commenced. These changes will make the regime as easy to understand as possible for investors. No policy change is envisaged as a result of any of these amendments. As I have said, I will go through each in detail as we reach it. I thank the officials from the trade regulation and investment screening unit who are here with me today: Mr. Eamonn Cahill, principal officer; Mr. Conor Hand, assistant principal officer; Mr. Scott Foley, higher executive officer; and Ms Carol Toolan, assistant principal officer. I also thank the Chairman and the committee secretariat for their assistance.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank the Minister of State. I remind members that the following amendments are grouped: amendments Nos. 1, 2 and 4 to 10, inclusive; Nos. 15 to 23, inclusive, and 28; Nos. 25 and 26; Nos. 34, 35 and 37 to 39, inclusive; Nos. 42 to 44, inclusive, 54 and 58; and Nos. 67 to 79, inclusive. All amendments that are not grouped will be discussed individually. Members should have received an email about the groupings earlier on. I propose that, if possible, we try to complete our consideration of Committee Stage of this Bill today. Is that agreed? Agreed. If we do not, we will have to adjourn the meeting and come back again. We will move onto the Bill itself.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 1:

In page 6, line 1, after “an” to insert “asset or of an”.

Amendments Nos. 1 and 2 extend the definitions of “acquire” and “control” to make it clear that transactions relating to assets, as well as understandings, are within scope of the Bill where a security risk may arise. This is not a policy change; this was always the intention in the published draft. It is purely a clarification, along the lines of simplification, as I suggested, in order that stakeholders will understand the intent of the Bill and their obligations arising from that intent.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 2:

In page 6, line 6, after “an” to insert “asset or an”.

The intent of this amendment is to insert "asset or an" for the same reasons as outlined for amendment No. 2.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 3 has been ruled out of order.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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It has. I tabled a number of amendments in a similar vein that were ruled out of order regarding the inclusion of the public good. These include amendments Nos. 3, 12, 24, 27, 29 and 31 to 33, inclusive, and many more. I recognise the importance of establishing a mechanism to screen foreign direct investment but the public good is also important. We have seen that housing and other important assets have perhaps been bought, taken out of the hands of the State and used in a manner that is not in the public good. It was to protect against that I tabled these amendments, which I accept - I know the Chair is indulging me in speaking to them - have been ruled out of order. However, we need to guard against institutional investors buying houses. I refer not just to new houses but second-hand houses as well. I have a concern with regard to the public good. Notwithstanding the fact that these amendments have been ruled out of order, perhaps the Minister of State will make a comment.

Dara Calleary (Mayo, Fianna Fail)
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The Department and I have no role in what is ruled in or out of order. That is a matter for the Bills Office. I see where the Deputy is coming from, however. There are as many different definitions of the public good as there are definitions. We want to confine this legislation very tightly to the matter of the security of the State. The Deputy's concerns are legitimate but they are probably best dealt with in other spheres.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 4 to 10, inclusive, are related and may be discussed together by agreement.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 4:

In page 7, to delete lines 10 to 17 and substitute the following:

“ “transaction” means any acquisition, agreement or other economic activity resulting in—

(a) a change in control of an asset in the State, or

(b) the acquisition of all or part of, or of any interest in, an undertaking in the State;”.

This amendment is designed to tidy up some language duplication issues. The word "transaction" appeared twice in the original published text. One of the more substantial changes is the deletion of the phrase "any proposal to effect a transaction". Arising out of our consultation, to which I referred, this concept was considered unclear and confusing. The language now focuses on actual transactions rather than referencing proposed transactions, which are hypothetical and represent an undefined concept that could result in unnecessary notifications being submitted to the Department. This would create an undue burden not just on investors but the Department.

By replacing “relating to” with “resulting in”, the revised language ensures that there is a direct causal link between the transaction and its impact. The focus is maintained on the transaction where control changes as a direct consequence of the transaction.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 5:

In page 7, to delete lines 24 to 31 and substitute the following: “(2) In this Act, a person shall be regarded as exercising control of—

(a) an asset, where that person has ownership of, or the right to use, all or part of the asset, and

(b) an undertaking, where that person can exercise decisive influence over the activities of the undertaking by any means, including as a consequence of—

(i) the existence of rights or contracts conferring decisive influence on the composition, voting or other commercial decisions of the undertaking, or

(ii) ownership of, or the right to use, all or part of the assets of the undertaking.”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 6:

In page 7, line 32, after “an” to insert “asset or of an”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 7:

In page 7, line 33, to delete “an” where it secondly occurs and substitute “the asset or of the”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 8:

In page 8, line 3, to delete “the circumstances in which”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 9:

In page 8, line 4, to delete “include” and substitute “where it”.

Amendment agreed to.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 10:

In page 8, to delete lines 5 to 9 and substitute the following:

“(a) is constituted or otherwise governed by the laws of the State, or

(b) has its principal place of business in the State.”.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 11:

In page 9, lines 3 and 4, to delete “15 months” and substitute “12 months”.

Given that we are here to consider serious and important legislation relating to foreign direct investment, FDI, I ask that the first review be within the first year of the operation of the legislation. I understand there is a need to allow legislation to bed in but there would be no harm in having a the review a little earlier. A review of the first six months of the legislation would allow us to establish whether the operation of the screening system was causing issues. It is not just about whether it is doing its job but whether it might be preventing other people from trying to do theirs. It is more to highlight - "snags" is probably the wrong word but the Minister of State knows what I mean - what is preventing people from operating, as an unintended consequence of this legislation. I am not massively wedded to this, but I would be interested to hear the Minister of State's views on this.

Dara Calleary (Mayo, Fianna Fail)
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I am certainly with the Deputy on the need for transparency and accountability. We believe, however, that if we were to proceed with this amendment to have a review ready within 12 months, we would not have a full 12 months of figures in preparing it. We would like to see a 15-month period, which would allow us to deliver a full report following a full 12 months of activities. Not only does that allow time for the legislation to bed in, we also have time to see how it is working. Over the course of 12 months, we will be able to fully see transactions. We think 15 months is better in trapping all the most relevant information and giving us a full 12 months of not just bedding in the legislation but, potentially, transactions under the Bill as well. I absolutely agree with the Deputy. It is a difference of just three months in order to try to make sure we as much quality information as possible.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No 12 has been ruled out of order. Does Deputy O'Reilly wish to make a very quick comment on it?

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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No, it was grouped with other amendments.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I oppose this section. Does the Minister of State not feel that the legislation already gives him enough powers, without necessarily needing the power to change aspects of the legislation by way of regulation? I am always very nervous of this. I understand that subsection (3) provides for those regulations to be laid before the House, but it does not reduce the fact that section 5 offers fairly significant powers to what is already extremely technical, important and geopolitically serious legislation.

Every Minister will say that this is a standard provision. I imagine the Minister of State will be no different. However, this is incredibly serious legislation. While I completely understand the Minister of State will tell me he will only use it sparingly, it may not always be him in that role. I have been given a personal commitment by many Ministers and while I accept their bona fides on that, they do not necessarily always have control over who sits in the chair. This is serious legislation. It will materially impact on how FDI operates. It requires the utmost in transparency. That is why we oppose section 5.

Dara Calleary (Mayo, Fianna Fail)
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I will not let the Deputy down in my response.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Consistency.

Dara Calleary (Mayo, Fianna Fail)
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This goes back to the previous amendment in that after conducting a review of the Bill, and if the ongoing operation of the Bill provides small challenges that need to be remedied or changed, regulations are far more effective in getting those changes quickly. The legislative process, while important for a Bill such as this, can take time. As the Deputy said, regulations are laid before the Houses within a 21-day period so there is a chance for scrutiny and engagement. I have seen it work in this House whereby regulations can be challenged. I cannot accept the proposal to delete the section.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 13:

In page 10, line 4, to delete “C” and substitute “A”.

Class A fines are higher than class C fines and, given the potentially serious consequences attached to any criminal offence relating to national security, we deem this to be a more appropriate penalty.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Section 6, as amended, agreed to.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 14:

In page 10, between lines 36 and 37, to insert the following:

“(2) Confirmation that a notice or other document served on or given to a person under subsection (1) must be received from the person to whom the notice or other document is being served.”

There are already existing provisions which ensure that documents served on a person are received by the person. Do they already exist? The last thing we want are situations where people can claim not to have received a document, and this could indeed create difficulties for the State. Perhaps the Deputy could outline what provisions exist already.

Dara Calleary (Mayo, Fianna Fail)
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I understand absolutely where the Deputy is coming from. However, the practicality is that there can be unintended consequences from an amendment such as this. Parties could use the good intentions of this amendment to obstruct or delay the screening process. They could deliberately fail to acknowledge receipt of properly served documents, or use that delay in winding down the clock. This is a standard text. It is used across a lot of other Bills. While I absolutely understand and appreciate the intent my concern is for unforeseen consequences and the good intentions of this amendment being used as a delaying tactic. We are dealing with transactions with a lot of technicalities and a lot of highly paid lawyers involved in trying to dilute the best intentions of this. My concern would be that this would be used in that way. I cannot accept the amendment.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Do provisions already exist to ensure that the documents served are actually received?

Dara Calleary (Mayo, Fianna Fail)
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The provisions in the section and across the legislation are there in terms of signing for documents. We have found across other legislation that somebody can refuse to sign. Somebody can give instructions to colleagues at work to refuse to sign, when they probably know there might a document coming their way. People can be conveniently be absent. It is always a challenge and section 8 is there to try to ringfence all of that.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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On the basis of that clarification I am content to withdraw that amendment.

David Stanton (Cork East, Fine Gael)
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Section 8(2) refers to the company having to be an existing company within the meaning of the Act. Does that mean the company has to be registered in Ireland if it is to be served with documents and so on? Do they have to be registered and have an office here? If third country companies are coming in, doing something hostile and dangerous and are not registered here, where does that leave us?

Dara Calleary (Mayo, Fianna Fail)
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I see where the Deputy is coming from. If it is an internationally based company and does not have a registered office, it will more than likely have agents who are dealing with it in the jurisdiction. Such companies will have professional advice. I will come back to the Deputy on that, possibly during the course of the meeting or, if not, immediately afterwards.

David Stanton (Cork East, Fine Gael)
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Can the Minister of State give us an example of the kind of hostile act he has in mind with respect to this section? Does he even have a hypothetical example as to what might happen?

Dara Calleary (Mayo, Fianna Fail)
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If we were to serve a notice on somebody, even though there is a process set out, a person who does not want to receive a notice can make it very difficult for a notice to be served. Let us be practical on that. They can be not present at their offices. They can move their offices. They can instruct their colleagues or staff not to receive official or registered documentation purely to delay the process and to delay the screening and the attention that will come as part of this process. Unfortunately it is part of the armoury in some of the management of this. That is why, although Deputy O'Reilly's amendment is very well crafted, it could be used in the wrong way.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 15 to 23, inclusive, and No. 28.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 15:

In page 11, line 4, to delete “Subject to subsection (2), a” and substitute “A”.

These amendments are the most important changes to the text and I am glad they are being considered together. They are primarily technical and are designed to ensure that investors are clear about their obligations. They reflect the extensive consultation that officials in the Department have worked on in the legal sector, within the investor community and with our colleague enterprise agencies since the Bill was published. The proposed changes ensure that the focus of the screening is on the acquiring party. The original text would have resulted in a wider range of transactions where no risk to Irish security or public order exists, falling within scope of the Bill. For example, a transaction where the seller is a third country company with no nexus to the State, but the purchaser is Irish, would have been notifiable under the original wording. This amendment will reduce the number of unnecessary notifications and focus attention on transactions where potential risks to national security may exist. The amendments also clarify and give greater prominence to voting or shareholding requirements. They ensure that the focus of the screening regime is on newly acquired or newly increased control, rather than on changes in structure. This is again intended to ensure that only those transactions, which might pose a real risk to security or public order, require mandatory notification. There is no benefit to the State or to the Department in receiving notifications of other types of transactions, such as internal company restructuring where no change in overall control occurs. This would only create unnecessary burdens on both investments and on the administration of the regime.

Francis Noel Duffy (Dublin South West, Green Party)
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I wish to speak to amendment No. 17. The intended effect of amendment No. 17 is to ensure that people are not hiding behind limited partnerships as a means to avoid the screening of their transactions, or appearing to be another person or entity. Limited partnerships were shown by the Pandora papers to have been used primarily to obscure the true ownership of companies, which it was revealed were controlled by people from former Soviet republics. The Bill does not seem to adequately address this aspect that Irish incorporated entities owned by third party individuals could avoid screening.

Dara Calleary (Mayo, Fianna Fail)
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I thank Deputy Duffy for his amendment and for his suggestion and we will support the amendment in principle. However, we need to do some work with the Office of the Parliamentary Counsel around its language. For consistency throughout the Bill, "constituted" is used rather than "incorporated" so that would change the amendment to read "including through limited partnerships and other forms constituted within the State." We will engage with the Deputy on getting that wording right ahead of Report Stage; we do support the principle of the amendment.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Does the Deputy intend to withdraw amendment No. 17 on the basis of the Minister of State's intention to discuss it with the Department?

Francis Noel Duffy (Dublin South West, Green Party)
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Yes, and I reserve the right to come back on Report Stage.

Richard Bruton (Dublin Bay North, Fine Gael)
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I want to ask a very basic question. When you look at the Article 4(1) of that regulation, you have types of infrastructure such as investment, technologies, inputs and sensitive information. There is a huge range of potential areas of investment. It goes into water and energy. Virtually any infrastructure is open to consideration under this Act. Does this require the Minister to examine a huge range of such notifiable investments across many sectors, where there is potential abuse of technologies or dual-use and so on? Does the Minister funnel the ones that have to be examined? Are there going to be vast numbers coming in with most of them just a box ticking exercise, or how is this going to work?

Dara Calleary (Mayo, Fianna Fail)
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What we are doing with these amendments is to streamline those that are coming in. Where there is a change of control of a company, that will be notifiable. We do not want, for the sake of administration within the Department or within business, to have needless notifications coming in. That is what we are doing by tidying up the language. There is a wide range of issues.

Richard Bruton (Dublin Bay North, Fine Gael)
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I am just reading the section -----

Dara Calleary (Mayo, Fianna Fail)
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Geopolitical threats to security are changing every day.

Richard Bruton (Dublin Bay North, Fine Gael)
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I appreciate that, but they define critical infrastructure as "whether physical or virtual, including energy, transport, water, health, communications, media, data processing, storage, aerospace, defence, electoral or financial infrastructure and sensitive facilities, as well as land and real estate crucial to the use of these infrastructure.".

That is only one of the elements. It seems an awful lot of investment could in some way encapsulate an element of that definition. Is the Minister of State envisaging a load of potential investments coming in but when the context is looked at with regard to investment in water, energy,transport or communications they are de factostruck off the list as they are not relevant to public order and security, or is he envisaging a relatively small number? If it is a small number, how would that initial screening happen?

Dara Calleary (Mayo, Fianna Fail)
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It will be a small number. Post the passing of the legislation, our intention is to develop a guidance note for what exactly will come under it. That guidance note will be in line with EU guidance around what constitutes a threat to State security so it will be consistent with other EU member states and investors will have consistency across the EU.

Richard Bruton (Dublin Bay North, Fine Gael)
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The offence will be failing to notify. That would be a breach in the guidelines.

Dara Calleary (Mayo, Fianna Fail)
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We are one of the last countries in the EU to do this. There is practice across the EU around this. The operational guidance of the legislation will reflect EU practice in other member states.

David Stanton (Cork East, Fine Gael)
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Could transactions already have been taking place here that have slipped through the net, given that we are very late to the party with this legislation? Could there already be activities out there that could be impacting in a negative way on State security, as the Minister of State has outlined? Does this legislation in any way give us any way of dealing with that kid of thing?

Dara Calleary (Mayo, Fianna Fail)
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We are not aware of any. The team has done a huge amount of work in this space over the past number of years. They have done a great deal of consultation, and they have been out and about. They are not aware of any so far. As I said, the geopolitical space is changing rapidly and this will allow us to most effectively defend it. It is also in line with our EU obligations in terms of having consistency across the EU. There is some limited retrospective power within the Bill to bring legislative enforcement to make sure nothing did happen, particularly during this time as we are preparing for this legislation, when transactions might have been rushed through ahead of the legislation. There are limited retrospective powers in the legislation around that.

Francis Noel Duffy (Dublin South West, Green Party)
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The intended effect of amendment No. 19 is to ensure separate investments by the same person or company are treated cumulatively, that is, that someone should not be able to avoid screening by making several smaller investments under the threshold of €2 million.

Dara Calleary (Mayo, Fianna Fail)
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We will be supporting amendment No. 19.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I will speak to amendments Nos. 22, 30, 34 and 35, if that is okay. I do not know if they are all grouped but there is no sense in repeating myself when the next group comes up. This Bill is very technical, but it is also fairly political in nature in the context of the ever-changing geopolitical situation, which the Minister of State just outlined, and the need to ensure the safety and security of the State and its citizens. Unlike many other EU member states, Ireland does not have a regime for screening FDI in key infrastructure. This Bill will change this and will give significant powers to the Minister for Enterprise, Trade and Employment. The Bill establishes a screening procedure whereby the Minister and an advisory panel can assess, investigate, authorise, condition or prohibit third-country investments in key Irish industries and sectors. Unfortunately, neither this Bill nor the EU regulations establishing the framework for the screening of FDI investments has seen fit to include housing or land for housing as areas worthy of protection. There is neither a hearth nor a table in this State at which people are not discussing the issues relating to housing. I find this strange, particularly considering the role some institutional investors have played in distorting and damaging our housing market. I have included these amendments and a number of similar ones to ensure housing is protected. I have also sought to guarantee the public good is factored into consideration. We have had this discussion already about screening an investment. While establishing a mechanism to screen foreign direct investments to protect security or public order from hostile actors is extremely important, it is equally important to protect the public good and our infrastructure, such as housing infrastructure. This amendment is even more important considering that a section of the Bill that might possibly have covered land, real estate and housing is being deleted by the Minister. I would welcome the Minister of State's thoughts on this.

Dara Calleary (Mayo, Fianna Fail)
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I thank the Deputy. At present, the sectors, technologies and activities covered by the proposed legislation are very precisely aligned with the EU regulation in order to have consistency across the EU. Land and real estate relating to critical infrastructure are already included in the Bill. Any addition to the list of notifiable transactions will increase the complexity of the screening regime. I am anxious that we have as much alignment with our EU partners, that we have as much certainty and clarity for stakeholders as possible and that we minimise unnecessary complexity. The addition of the phrase "land that could be used for housing" could potentially result in every single real estate transaction being notified because all land and real estate could potentially be used for housing. If all of those transactions were to be notified, many of them would be turned down or blocked on security grounds. There are other instruments to try to change housing policy. What we are trying to do with this legislation is keep it as tight as possible in relation to those areas that are already outlined in EU policy. We do not want to expand beyond that.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I dearly wish the Government would change its housing policy. I genuinely feel, given the situation we are in, that housing should form part of this. I accept what the Minister of State is saying about potentially having to screen absolutely everything, everything having to be notified and the impact that might have. Does he take my point about it being an important area? We know foreign third-party entities are - I do not know if "interfering" is the right word - distorting the housing market at the moment. That is a fact; it is happening. It is not that I am seeking to change policy on this, although I do want that anyway, but specifically here it is more that we should be using every single mechanism we possibly can to prevent these third-party actors from distorting the housing market. It was from that perspective that I proposed these amendments.

Dara Calleary (Mayo, Fianna Fail)
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I absolutely take the Deputy's point and agree with her. However, I want to keep this as tight as possible. There are areas within the legislation around housing which would be notifiable. If there were sites close to sensitive security sites or sensitive State infrastructure, they would have to be notified. That is the type of provision it is. It is very related to sensitive infrastructure. Rather than expanding it, this comes back to the points raised about the burden of these regulations. I 100% get the Deputy on the housing issue. There are other instruments that can get us to where we need to be for our shared vision on housing but they are not within this Bill.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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They are not within the Bill we are discussing.

Dara Calleary (Mayo, Fianna Fail)
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To be more precise, they are not within the scope of this Bill.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I understand. I am going to push this amendment.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 16:

In page 11, lines 6 and 7, to delete all words from and including “is” in line 6 down to and including line 7 and substitute “as a result of the transaction—”.

Francis Noel Duffy (Dublin South West, Green Party)
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I move amendment No. 17:

In page 11, line 7, after “transaction” to insert “, including through limited partnerships and other forms incorporated within the State”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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This amendment is being withdrawn on the basis of having further discussion with the Department.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 18:

In page 11, between lines 7 and 8, to insert the following: “(i) acquires control of an asset in the State, or

(ii) changes the percentage of shares or voting rights it holds in an undertaking in the State—

(I) from 25 per cent or less to more than 25 per cent, or

(II) from 50 per cent or less to more than 50 per cent;”.

Francis Noel Duffy (Dublin South West, Green Party)
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I move amendment No. 19:

In page 11, line 9, after “€2,000,000” to insert “, for one natural person or body corporate in a period of 12 months”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 20:

In page 11, line 11, to delete “directly or indirectly”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 21:

In page 11, line 12, to delete “Regulation;” and substitute “Regulation.”.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 22:

In page 11, between lines 12 and 13, to insert the following:

“(d) the transaction relates, directly or indirectly, to land and real estate for, or which could be used for, housing or accommodation;”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Is amendment No. 22 agreed to?

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I agree to it. However, it is persuading the other members who have a problem with what is proposed. I woke up persuaded.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 23:

In page 11, to delete lines 13 to 21.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 24 has been ruled out of order.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 25 and 26 are related and may be discussed together.

Francis Noel Duffy (Dublin South West, Green Party)
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I move amendment No. 25:

In page 12, line 5, after “undertaking” to insert “, the names of the natural persons who own the parties in the case of bodies corporate”.

The amendment is a one-liner, the intended effect of which is to ensure that when the Minister is notified of a transaction, the true owner will be listed in that notification rather than just a financial intermediary or solicitor.

Dara Calleary (Mayo, Fianna Fail)
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I am satisfied that section 10 provides sufficient detail but I want to engage with the Deputy on the amendment to ensure we strengthen it. Subject to the view of the Office of Parliamentary Counsel, I am happy to accept the amendment.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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On amendment No. 26, the requirement to notify the Minister of transactions is provided for under section 10(1)(b)(xi). It will ensure that parties to a notifiable transaction notify the Minister of that transaction and include details of any sanctions or restrictive financial measures imposed on the party by the European Union. I am seeking to ensure that the legislation is even more comprehensive when it comes to investments made by individuals, companies or states. To facilitate this, I propose that not only should EU sanctions be notified to the Minister but where a party to a transaction, or the state or territory under whose laws the party are constituted, registered, or otherwise organised, has been sanctioned by the UN or the International Criminal Court, ICC, this should also be notified. If we are to assess, investigate, authorise, condition, or prohibit third-country investments based on a range of security or public order criteria, it should be done in the round and to the maximum and fullest extent possible. The legislation is intended to equip the State with the means to protect itself and us against possible threats, and the Department should know if these parties or states have been sanctioned by the UN or the ICC.

I have tabled a further amendment to ensure that details of convictions in another state for breaches of human rights and employment laws will also be reportable to the Minister when a transaction is being undertaken. This would give a full picture of who these people are, as well as any and all sanctions that might be applied to these bodies - in order to ensure that they are not fly-by-nights - by the UN and the International Criminal Court, ICC.

Dara Calleary (Mayo, Fianna Fail)
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I have no objection in principle to referencing various sanction regimes. However, between now and Report Stage, I would like to work with the Deputy and her team, and with the Office of Parliamentary Counsel, OPC, on more careful consideration of the wording. For instance, we would respectfully suggest merging some of the points to include signal reference to sanctions emanating from UN resolutions, the ICC and the European Union, which would be a much more comprehensive list of sanctions.

On the point relating to convictions, section 13 already requires the Minister of the day to take such considerations into account in making a determination. I suggest that we make this explicit when looking at criminality, and that we limit the amendment. Subject to consideration by the OPC, it should state "Details of any criminal convictions in any other state or territory under whose laws the parties are constituted, registered, or otherwise organised." We will engage with the Deputy's team and the OPC on that. The OPC will also need to ensure, coming back to one of my earlier points, that any additions do not create any unintended consequences that we may not be able to work out this morning.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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No. That was not my intention either.

Dara Calleary (Mayo, Fianna Fail)
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We will come back to the Deputy and engage with her and her team, as well as the OPC, to try to get that sorted before Report Stage.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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That is very welcome. On that basis, I will withdraw the amendment.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 26:

In page 12, between lines 19 and 20, to insert the following:

“(xii) details of any sanctions imposed on the parties, or the state or territory under whose laws the parties are constituted, registered, or otherwise organised, by the United Nations;

(xiii) details of any sanctions imposed on the parties, or the state or territory under whose laws the parties are constituted, registered, or otherwise organised, by the International Criminal Court;

(xiv) details of any convictions in any other state or territory under whose laws the parties are constituted, registered, or otherwise organised, in relation to competition laws, human rights laws, or employment rights laws;”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 27 has been ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 28:

In page 13, to delete lines 22 to 28 and substitute the following: “(4) Where a notifiable transaction is completed no later than 10 days from the date on which section 10 comes into operation, a party to the transaction shall be deemed to comply with section 10(1) where the party provides the Minister with the information referred to in section 10(1)(b) no later than 30 days from the date on which the transaction is completed.”

This amendment is a clarification to ensure all stakeholders understand the intent and interpret the text correctly. It relates only to the period of time around the commencement of this legislation. By way of background to the amendment, we were concerned that the original wording was unclear and could be interpreted in a manner that would allow a transaction proposed before, but completed after, commencement to be notified after the transaction is completed. This comes back to Deputy Stanton's point earlier. The revised wording tightens this interpretation and ensures that the section will only apply for a limited timeframe immediately around commencement. For transactions completed within the first ten days of the Bill coming into effect, investors will have a 30-day period to fulfil their notification obligations. This section will only apply to those transactions completed within the ten days after it comes into operation. Transactions completed before this do not need to be notified, but they will be subject to the scrutiny to which I referred.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 29 has been ruled out of order.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 30:

In page 14, between lines 9 and 10, to insert the following:

“(III) control, directly or indirectly, of land and real estate for, or which could be used for, housing or accommodation,”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 31 to 33, inclusive, are out of order.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 34, 35 and 37 to 39, inclusive, are related and may be discussed together.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 34:

In page 15, between lines 11 and 12, to insert the following:

“(ii) undertake actions that are disruptive or destructive to the provision of housing or accommodation, especially social and affordable housing, in the State,”.

On the basis of the clarification provided by the Minister of State, I am happy to withdraw the amendments and engage with him.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 35:

In page 15, line 19, after “technologies” to insert “, land and real estate for, or which could be used for, housing or accommodation,”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 36 has been ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 37:

In page 15, to delete line 25 and substitute “Union;”

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 38:

In page 15, between lines 25 and 26, to insert the following:

“(j) the extent to which the transaction affects, or would be likely to affect, projects or programmes of Union interest within the meaning of Article 8 of the Regulation.”.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 39:

In page 15, line 28, after “panel” to insert “, or such members of the advisory panel as the Minister considers appropriate,”.

This short amendment is intended to enhance the efficiency of the operation of the advisory panel. It does not involve any significant change or change in function. It reflects some of the consultations we have had with other Departments.

Dara Calleary (Mayo, Fianna Fail)
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SECTION 16

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 41 has been ruled out of order as it is outside the scope of the Bill.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 42 to 44, inclusive, and Nos. 54 and 58 are related and may be discussed together.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 42:

In page 16, line 33, after “decision” to insert “on or before the later of."

The changes are intended to clarify the timeline in which the Minister must make a screening decision. The revised changes reflect the simplification of the administrative process and confirm that the timeline within which the screening decision must be made commences once the Minister is in receipt of a notification. This clarification will assist enterprises in particular and investors to understand their obligations but also gives them certainty around timelines.

Amendment No. 54 reflects the simplification of section 16 as a consequence of amendments Nos. 21 to 23, inclusive.

Amendment No. 58 is a technical amendment. In the original published Bill, there is no obvious way for a party to appeal a decision that is deemed to have been made under section 10(3). That is, a situation where a decision is deemed to have been made that a transaction affects security and public order in instances where an investor deliberately fails to notify the Minister about a notifiable transaction. Section 26 could have been read as only allowing an appeal from a decision of the Minister, which leaves a gap whereby parties subject to such a deemed decision could be seen either as having no way to appeal a deemed decision or being able to appeal against such a deemed decision in the ordinary courts rather than under section 26. This amendment provides the same avenue to appeal as provided for other screening decisions.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 43:

In page 16, to delete lines 34 to 38, and in page 17, to delete lines 1 to 11 and substitute the following:

“(a) 90 days from the date on which the screening notice in relation to the transaction is issued, or

(b) such date, not being more than 135 days from the date on which the screening notice in relation to the transaction is issued, as the Minister may specify in a notice in writing to the parties to the transaction within the period referred to in paragraph (a).”

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 44:

In page 17, line 13, to delete “(a) or (b)”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 45 and 46 are ruled out of order.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 47 to 53, inclusive, are ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 54:

In page 20, line 4, to delete “subsection (3)(a) or (b), as the case may be, of section 16” and substitute “section 16(3)”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 55 is ruled out of order.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 56:

In page 21, between lines 19 and 20, to insert the following:

“(d) the Minister is satisfied there are no conflict(s) of interest."

What is seldom is wonderful. Amendment No. 56 is not out of order. We have seen with high level bodies such as An Bord Pleanála that conflicts of interest can cause people to bend the rules, potentially break the law and engage in a manner which is damaging to the State and to public confidence in institutions. It is important there are no conflicts of interest among those appointed by the Minister as adjudicators and this amendment is intended to ensure that we eliminate conflicts of interest and highlight them to the maximum extent possible.

Dara Calleary (Mayo, Fianna Fail)
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In the spirit of what is seldom is wonderful, I am happy to support this amendment. However, we must get approval from the Office of Parliamentary Counsel, OPC, on the language of it so I ask Deputy O'Reilly to withdraw it. We will engage with her ahead of Report Stage.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I am happy to do that. I thank the Minister.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 57 is ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 58:

In page 25, line 16, after “Act” to insert “, or a screening decision deemed by this Act to have

been made,”.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 59 is ruled out of order.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendment No. 60 is ruled out of order as it is outside the scope of the Bill.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 61 and 62 are ruled out of order as they are outside the scope of the Bill.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 63 to 65 are ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I move amendment No. 66:

In page 33, line 27, after “section 34(5),” to insert “or an appeal from any decision of the High

Court under sections 35 to 37,”.

This amendment ensures consistency is applied in how various types of appeals to the courts are treated. Essentially, the additional text clarifies that regardless of which court might be hearing an appeal, the same rules relating to the applicability of a screening decision, the treatment of evidence, and the hearing of matters in public apply. This was always the intent of the published draft but after consultation and on reflection, the Bill will benefit from the clarity provided by this amendment.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 67 to 79, inclusive, are related and may be discussed together.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I move amendment No. 67:

In page 34, line 17, to delete “appoint” and substitute “nominate”.

Committee members will be delighted to hear that I will not be speaking about each amendment individually. We will get out of here before lunchtime.

These amendments are collective and interlinked. They relate to the advisory panel that will advise the Minister on transactions reviewed under the screening system. At the core of this legislation and given the seriousness of the system being established by the Government, it is important that this panel is made up of the best possible talent within the requisite Departments. In order for this to be the case, there should be competition to ensure the right people get into these positions. I propose that the Minister's nominees be appraised by the Top Level Appointments Committee, TLAC, and only appointed to the advisory panel if the TLAC is satisfied. In addition, I propose an amendment to have a member nominated by the Minister for Housing, Local Government and Heritage. This is in reference to a point I made previously. I appreciate the points the Minister made about other mechanisms that might exist. However, to be a bit belt, braces and baler twine about the whole thing, I imagine given the importance of housing, especially in this climate but also in general, it would be no harm to have a representative of the Minister for Housing, Local Government and Heritage. The intention of amendments Nos. 67 to 79 is to ensure the very best people are advising on this. Given all we have discussed this morning about the geopolitical situation and the need to get this right, it is important that we have the right people on this advisory panel.

I assure the Deputy that the best people are going to be on the panel. As outlined in the legislation, those who will be on the panel will be at principal officer grade or above and already appointed as civil servants. TLAC only applied to grades above assistant secretary. The operation of the panel is set out in the Bill so I can be sure about the quality and that we will have the absolute best on the panel.

On the process of a Minister nominating a panel member, that allows each Department to ensure that the schools of that Department are going to be represented and, more importantly, the perspective of that Department will be represented on the advisory panel. The person, or representative of the Department, will bring his or her specific Department's perspective and experience to the panel. The amendment is unnecessary given that the quality will be there.

On the amendment that seeks the appointment of the Minister for Housing, Local Government and Heritage to the advisory panel, in cases where it is necessary for a Minister to attend the advisory panel then he or she can be invited, if needed. We would encourage that if there is a transaction in this space. For instance, I referenced an example earlier whereby a housing application might overlook a sensitive site so there would be a representative from the Department there. Not every Department will be represented on the panel but there are mechanisms to ensure there are inputs from every Department. Where a transaction is specific to a Department there are inputs there so it has its input and participation. There is no need for permanent representation on the panel by the Minister for Housing, Local Government and Heritage because there will be many transactions that do not deal with housing and I hope that his officials are focused completely on housing.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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We all would.

Dara Calleary (Mayo, Fianna Fail)
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In fact, I know that they are.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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I take the point that the Minister of State made. I do not dispute in any way, shape, make or form the talent that exists within the Civil Service. It is important that such talent gets on to the advisory panel. It was not proposed that TLAC would make the appointments but that it would be involved and have oversight. I appreciate that TLAC is constrained by its make up in terms of an assistant Secretary and over.

I ask the Minister of State to explain the involvement of other Departments. It is on an as and when required basis. Let us say that the advisory body is discussing an issue that is material to, say, the Department of Housing, Local Government and Heritage, yet the panel chooses not to invite a person from that Department to the discussions. How can the Department ensure that it is represented? Is there a mechanism for the Department to feed into the process? I do not suggest that people will be unnecessarily obstructive and I am sure that they will not. I want to know what would happen in the event that this happened, and I mean people from whatever Department, although I have highlighted the Department of Housing, Local Government and Heritage because it is important. Let us say that a principal officer from the Department wants to make a submission or be involved but maybe the advisory group deems that they do not need such involvement. How would a conflict be dealt with in such a case? Is it simply up to the advisory body to invite somebody from the Department or is there a mechanism available to the body?

Dara Calleary (Mayo, Fianna Fail)
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Article 13(3)(d) outlines that the Minister and the advisory panel can consult any other member of Government or Minister that they consider appropriate. Article 39 gives the panel the right to require assistance from experts to assist them in their job. They will have the capacity and scope within the legislation to either seek ministerial input or an input from other experts.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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Will they be part of the panel or just play an advisory role?

Dara Calleary (Mayo, Fianna Fail)
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No, they will advise the panel using information sourced from experts or the Department view, and then the panel will be able to make the call on that based on their input.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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In the event that the panel needs expert advice from outside its scope of interest will it approach, say, the Department of Housing, Local Government and Heritage, for input and will the Department make the decision as to whether it was an outside or internal expert or will that be done together?

Dara Calleary (Mayo, Fianna Fail)
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There are two different scopes. In this case, if we were to work this through, the panel can seek the input of the Department of Housing, Local Government and Heritage but the panel can make a call on whether it requires a specific expert. Within the operating guidelines there will be guidance given as to the kind of experts that the panel might be able to get. There are going to some technical transactions involved so the guidance will give them the ability to get an expert in and if that is somebody in housing then the panel will be eventually empowered to make that call. It might be a specific area of housing and it could be any number of scenarios.

Louise O'Reilly (Dublin Fingal, Sinn Fein)
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On the basis of the clarification provided by the Minister of State I do not intend to push my amendments but I would appreciate if we had a chance to discuss them. I do not think that there is a massive difference of opinion and I am curious to know how this works but I do not want to take up any more of our time this morning.

Maurice Quinlivan (Limerick City, Sinn Fein)
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The time is running out so I suggest that we finish discussing section 40. Deputy O'Reilly has withdrawn all of her amendments.

Maurice Quinlivan (Limerick City, Sinn Fein)
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Amendments Nos. 80 and 81, which were tabled by Deputy O'Reilly, have been ruled out of order.

Dara Calleary (Mayo, Fianna Fail)
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I thank the members and the committee secretariat. On Deputy Stanton's point on amendment No. 14 earlier, the companies involved must have a link to Ireland. A departmental team is developing an appropriate IT system to incorporate all the servicing and support service documents that will be required under the legislation.

Maurice Quinlivan (Limerick City, Sinn Fein)
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I thank the Minister of State and his officials.