Mr. Paul Egan:

I made a note in anticipation that this question might be asked. There are two impediments to pooling and contribution orders at the moment, the first of which is cost because it is a High Court action. The second impediment is a particular provision which requires the court to be satisfied that the circumstances that gave rise to the winding up of the company are attributable to the acts of the related company. The nuanced amendment that the review group has proposed is that one of the considerations the court should take into account is the extent to which the circumstances that gave rise to the winding up of the company are attributable to the acts or omissions of the related company. It is therefore a lower bar than what is there at the moment.

In regard to excursions to the High Court, a separate standing committee of the CLRG made a submission in relation to the administration of civic justice. It was a standing committee recommendation, and not a full review group recommendation. We requested that consideration be given to an expanded role for the Circuit Court in set locations in Ireland which would deal with particular company law matters.

By way of a supplemental point which is worth mentioning, the legal environment for the governance of companies was materially changed in 2021 with the transposition of the preventive restructuring directive, which imposed new duties on directors. I need to get into the detail on this. It is established that if a company is insolvent, the directors’ duties are to the creditors of the company. In the CLRG's first report, we recommended that this be put on a statutory footing rather than being merely the result of a court judgment. We expanded that in the 2017 report whereby if a company was likely to become insolvent, the directors would have regard to the interests of creditors, which of course include employees, and would preserve the company’s property. In fact, when the directive was transposed it went further by imposing three duties on directors. It provides that where a director has reasonable cause to believe that a company is unlikely to be able to pay its debts, the directors must have regard to the interests of creditors, including employees; to the need to take steps to avoid insolvency; and to the need to avoid deliberate or grossly negligent conduct that threatens the viability of the company. The legal environment is different. There is a proposal out there which, if enacted and implemented, will change it further.