Seán Barrett (Dún Laoghaire, Fine Gael)

It is beginning to make more sense to me now why the Minister refused to accept Deputy Bruton's amendment on putting the Oireachtas committee on a statutory basis. Part of the proposal put forward was to review the shareholder's agreement undertaken by the master special purpose vehicle. That confirms my suspicions that something tricky is going on. I do not know whether the Minister has ever been the Grand National in Fairyhouse at Easter time but there is a tradition that when one exits Fairyhouse there is a line of people called the three-card trick merchants. I am sure the Minister has seen them. That is precisely what all of this is about. This is three-card trick stuff.

In case Members have not had an opportunity to read the note supplied by the Minister, this master special purpose vehicle has wide powers. There is no mention of a special purpose vehicle in the interpretation section. In fact, the only reference is to a NAMA group entity, whatever that means. It states in the briefing note on NAMA SPV structures that, "The master SPV will be a separate legal entity and will be jointly owned by private investors, who will own 51% of its ordinary equity, and by NAMA, which will hold the remaining 49% ordinary equity". My definition of a legal entity is that it is named. What is the name of the master special purpose vehicle? That is not a name for a separate legal entity. There has to be a name. There will have to be directors of a company named such and such. It is extraordinary that we have not been given a name for this special purpose vehicle.

I refer colleagues to page 2 of the note that was circulated. It relates to comments from EUROSTAT and it states:

EUROSTAT'S ESA 95 paragraph 2.12 sets out the rules whereby an entity can be considered an institutional unit which would merit the achievement of an off-balance sheet structure [it goes on to specify] ... A resident unit is regarded as constituting an institutional unit if it has decision-making autonomy in respect of its principal function, and either keeps a complete set of accounts or it would be possible and meaningful, from both an economic and legal viewpoint, to compile a complete set of accounts if they were required. In order to be said to have autonomy of decision in respect of its principal functions a unit must: a) be entitled to own goods or assets in its own right; it will therefore be able to exchange the ownership of goods or assets in transactions with other institutional units; b) be able to take economic decisions and engage in economic activities for which it is itself held to be directly responsible and accountable at law.

That confirms exactly what I said on Committee Stage, that in order to get approval from EUROSTAT this company not alone has to be a separate legal entity with its own board of directors and with a name, but it must also be able to take economic decisions and engage in economic activities for which it is itself held to be directly responsible and accountable at law. That is the most important statement. In other words, according to EUROSTAT if a developer wants to question why his or her properties are being confiscated by this body, that company, the SPV, that is named and is a separate legal unit is accountable at law. Therefore, the business of a NAMA group entity being sufficient is a con trick. That company must be named, have separate legal authority and be accountable at law, according to the Minister's note, under EUROSTAT requirements to merit the achievement of an off-balance sheet structure. The failure of the Minister to bring forward an amendment on this Stage clearly outlining the responsibilities of this animal known as the "master SPV", which is without a name and is not mentioned in the interpretation section of the Bill, must be corrected immediately if the Minister wishes to use the excuse that the reason he is doing this is to take these liabilities off-balance sheet. Otherwise, according to EUROSTAT, it will not achieve that status.

The Minister's note to Members states that the master SPV will be a separate legal entity, entitled to own goods and assets in its own right and will have autonomy of decision in its day-to-day operations. How does that fit in with what the Minister is now telling us, that the NAMA board can veto all decisions of the SPV? That is totally contradictory to the requirement of EUROSTAT, which clearly states that it must be accountable at law in itself because it is a separate legal entity with its own board and shareholders. Not alone do we not know who the shareholders are, we do not know who the directors will be. In one part of the note the Minister tells us that NAMA representatives on the board will maintain a veto over all decisions of the board that could affect the interests of NAMA while in the next part of the same note, he tells us that the SPV will have complete autonomy, will be able to incur liabilities on its behalf and will have complete accounting information available. That does not add up.

I cannot understand how we are expected to pass legislation relating to a company which is a legal entity with no name and that is not mentioned in the legislation. The only matter mentioned in the legislation is the definition of a NAMA group entity, which states that it is a subsidiary of NAMA within the meaning given by section 115 of the Companies Act 1963. If it is a subsidiary of NAMA it does not comply with what EUROSTAT states in its ESA 95, paragraph 2.12. This sets out the rules whereby an entity can be considered an institutional unit which would merit the achievement of an off-balance sheet structure. It goes on to state what the entity can and must do. That does not comply with what the Minister tells us in his note. There is no mention of this company in the legislation we are being asked to pass this week.

This is a con trick. It is no wonder the Minister does not want a statutory Dáil or Oireachtas committee that can question all the issues Deputy Bruton outlined in his amendment, which was defeated in the last division. It is an absolute shame. This is not the type of legislation that can be easily amended. It is putting the taxpayers of this country at risk to the tune of €54 billion and possibly more. We are being treated as if we are being disloyal to the State by asking awkward questions, but we have an obligation to ensure that this legislation will, as far as is humanly possible, protect the interests of taxpayers.

I have read the Minister's note carefully and I invite others to read it and tell me if am misreading it. It clearly states what the requirements of EUROSTAT are regarding the formation of this legal entity, which has complete authority, a board of directors and shareholders. It even goes so far as to state that the subscribed capital of the master SPV is "likely to be" €100 million. It is as if the Minister has not yet made up his mind or it might not be possible to get the €100 million. This is extraordinary. The note continues: "The Master SPV will have its own Board with members appointed by NAMA (maybe the whole NAMA board of 9) and the Private Sector equity investors." Nobody mentions who they are or how many directors there will be. It continues: "...the NAMA representatives on the Board will maintain a veto over all decisions of the Board...". Then one reads what EUROSTAT says is required to qualify as a legal entity and the conditions that must be fulfilled. There is no way they can be adhered to in view of the Minister's note and the lack of any information in the legislation concerning this matter.

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