Michael Ahern (Cork East, Fianna Fail)

I thank Members for the useful debate we have had on this technical but complicated Bill and I appreciate their valuable contributions. Many interesting questions have been raised and I will address as many as I can.

Ireland is recognised as the domicile of choice for investment funds as well as being a centre of excellence for fund administration. We have been exceptionally successful in attracting international financial services companies and we want this trend to continue. Financial services is one of the most innovative and rapidly evolving sectors with new products constantly being reduced. It is also a global service and new financial centres are emerging across all time zones in the new globalised economy. Ireland must be up there with the best of them and, if possible, it should be ahead of the game.

However, it must be ensured the correct balance is struck between innovation, supervision and protection because if we get it wrong and introduce draconian provisions, the funds industry will move elsewhere. If the regulatory regime is too light or lax, we run the risk of facilitating the rip-off of investors. In addition, Ireland's reputation as a well regulated jurisdiction will suffer irreparable damage. A flexible, responsive and business-focused regulatory system has been the cornerstone of Ireland's development. Our regulatory environment is a key component both of our competitiveness and our international reputation and we are satisfied the balance in the legislation is correct.

I refer to the queries raised by Members. Deputy Hogan supports the Bill and he referred to the need to enact it as soon as possible. He queried whether the legislation is tardy but similar legislation has not been introduced in many other jurisdictions such as Jersey. It has been introduced in Guernsey and it is on the way in Luxembourg. Ireland is not behind. Only one umbrella fund has been set up and, therefore, we are up to speed with what needs to be done to ensure inward investment is not lost. Deputy Boyle also referred to inward investment and I assure him we are paying close attention to the matter.

Deputy Hogan made reference to the section on compliance statements and expressed his delight that it had been referred to the CLRG. Deputy Burton also referred to compliance statements and seemed to believe that they related to small private companies or companies dealing with community groups. I assure her the compliance statement requirements relate only to public listed companies and large companies.

Deputy Hogan referred to the consumer strategy group, which was established in March 2004 to advise and make recommendations for the development of a national consumer policy strategy. The group was established against a background of concerns regarding the lack of a discernible national strategy, the increasing international focus on enforcement of consumer laws and perceptions on the part of certain groups of consumers, various media and economic commentators, that Irish consumers were not getting a fair deal. The group presented its final report to the Minister for Enterprise, Trade and Employment on 2 March 2005, which contains a significant number of recommendations involving a variety of different Departments and agencies whose activities impact on the interests of consumers. On 3 May 2005 the Government decided that the recommendations contained in the report should be examined by a high level interdepartmental committee, which will report back to the Government with a detailed implementation plan within three months. The Minister launched the group's report today.

In response to Deputy Hogan's comments on the groceries orders, I wish to point out that the restrictive practices groceries order of 1987 was made under section 8 of the 1972 Act on foot of a report of the then Restrictive Practices Commission. The order was put in place to curb anti-competitive practices such as low money and also to ban below cost selling, or net invoice price selling. The order covers all grocery goods as well as intoxicating liquor and other household goods ordinarily sold in grocery shops. It does not cover fresh fruit, vegetables or fresh and frozen meat and fish. Enforcement of the order is the responsibility of the Director of Consumer Affairs.

The groceries order is currently the subject of debate due to the recommendation of the consumer strategy group that it be revoked entirely. This recommendation is included in the report of that group, which was presented to the Minister and launched today. This is in contrast to the recommendation of the Joint Committee on Enterprise and Small Business, contained in its recent report on the impact of the grocery multiples, that the order be retained in its current form. The Minister has announced that he will consult with all interested parties on the groceries order before making any decision regarding its future and will appear before the joint committee to discuss the issue again. In this context, the section of the Bill providing for the increase in the maximum fines that may be levied on conviction of violations of the order was drafted to update the provisions for breaches of the existing legislation, which remains on the Statute Book and is enforced by the Office of the Director of Consumer Affairs.

I wish to inform Deputy Burton that the inquiries to which she made reference relate specifically to insurance matters, which now fall within the remit of the Minister for Finance. Deputy Burton also raised the need for appropriate regulations. The Irish Financial Services Regulatory Authority is the regulatory agency for all Irish investment funds, irrespective of their legal structure. All investment funds established in Ireland must be authorised by IFSRA and the investment manager of the fund must be approved as such by the authority. In addition, the other service providers to the fund, most notably the fund administrator and custodian trustee, must be based in Ireland, approved by IFSRA to act as such and are subject to the ongoing supervision of the authority. IFSRA regulates both the initial authorisation and the ongoing supervision of investment funds. The regulatory framework for investment funds is detailed in a series of Central Bank notices and related guidance notes. IFSRA notices and guidance notes do not distinguish between the different legal forms of investment funds.

In response to the concern raised by Deputy Burton about the need to protect consumers in the context of cross investment and segregated liability, IFSRA will ensure that there is no double charging and that full transparency is observed.

Deputy Boyle and a number of other Deputies made reference to future developments in company law, particularly regarding the consolidation Bill that is due for consideration shortly. A significant amount of work has already been undertaken by the Department, with the support and assistance of members of the company law review group, to implement the recommendations of that group on changes to company law. These recommendations, when implemented, will radically update and reform company law. In brief, it is proposed to divide the current provisions into three broad categories, namely, pure company law, market related company law and provisions related to investment companies currently contained in company law.

I thank Deputies who made many interesting points during the debate. Some points raised were not strictly relevant to the matter at hand, but they were interesting nonetheless. During the debate, a reference was made to foreign direct investment into Ireland that implied that it was falling. However, in the foreign direct investment area, IDA Ireland continues to win significant new green field and expansion projects, particularly in the areas of high technology, pharmaceuticals and medical devices. A total of 70 such projects was negotiated by IDA Ireland during 2004. Prospects for global foreign direct investment in 2005 and beyond are considered positive and despite a general decline in the volume of FDI available internationally, Ireland has managed to increase its share of both global and EU investment. Currently IDA Ireland has a healthy pipeline of more than 30 potential projects.

I thank those who took part in the debate and I look forward to the speedy progress of this Bill.

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