Louise O'Reilly (Dublin Fingal, Sinn Fein) | Oireachtas source

I welcome the newly appointed Minister of State, Deputy Calleary. I wish him all the very best in his role and I very much look forward to working constructively with him over the remaining period of government, although we all may wish different things for the duration of it. I wish him the very best.

I am grateful to have an opportunity to say a few words on this important Bill. It is extremely technical but it is also political in its nature in the context of geopolitics and ensuring the security and safety of the State and its citizens. Unlike many other EU member states, Ireland does not have a regime for screening foreign direct investment in key infrastructure. The Screening of Third Country Transactions Bill 2022 seeks to change this and give significant powers to the Minister for Enterprise, Trade and Employment. The Bill, which aims to provide the Government with powers to protect security or public order from hostile actors using ownership of, or influence over, businesses and assets to harm the State, introduces a foreign direct investment screening process. This will allow the Minister for Enterprise, Trade and Employment to assess, investigate, authorise, condition or prohibit third-country investments in key Irish industries and sectors.

On this point I want to establish from the Minister of State, if I could, that the definition of "third countries" captures investment in Ireland from Britain and the US. We have 893 IDA Ireland-backed US foreign direct investment companies in the State and 161 from Britain. For reference, there are only 267 from the rest of the world outside the EU. If it does include the US and Britain, and I believe all investments in strategic assets and sectors should be screened, the legislation will place a significant burden on the State compared with our European neighbours. If this is the case, I ask that ample resources be set aside to make sure the screening time is as quick as it possibly can be. I am sure that businesses would very much appreciate this certainty.

The Bill as it is drafted creates a mandatory notification obligation for parties to third-country transaction acquisitions, agreements or other activities with a value of €2 million or more in designated sectors or involving sensitive or strategic activities that result in a change of control of an asset or undertaking in the State. This is the point to which I will return later with regard to the current control of strategic assets and undertakings in the State.

As we know, the Bill forms part of a broader effort by the European Union to encourage co-operation and information exchanges between member states and the European Commission on foreign direct investment from third countries. Given the work of IDA Ireland in attracting foreign direct investment to the State, the legislation creates a change but one that can be of benefit. Nevertheless, it will place additional burdens on the State, the Department and businesses. For instance, when requested by other EU member states and-or the Commission, Ireland is obliged under the EU foreign direct investment screening regulation to provide information on any relevant transaction involving foreign direct investment, including details of the target's ownership structure, products, services and business operations. It is also obliged to declare to other EU member states where the target conducts relevant business operations.

At the core of the legislation, from a purely technical perspective, is the protection of security and public order from hostile actors who would seek to use ownership of, or influence over, businesses and assets to harm the State. It will empower the Minister to respond to threats to Ireland's security or public order posed by particular types of foreign investment and to prevent or mitigate such threats. While I understand the need for this, I ask for further clarification on the powers of the Minister to assess, investigate, authorise, condition or prohibit third-country investments based on a range of security and public order criteria. This is so that when the legislation is passed there is certainty on the part of investors and the State and we do not leave ourselves open to accusations of bias or of being used as a pawn in geopolitics. I say this because we should not forget where the EU regulation came from. It came about following a European Parliament resolution and a joint letter sent by three member states, namely, Italy, Germany and France, asking the Commission to adopt a new regulation on the screening of foreign direct investment.

The EU regulation comes in the middle of the crisis of the globalisation dogma being threatened by the commercial wars happening between the global powers. Anyone who reads over the speeches regarding this EU regulation in the European Parliament will see that the extreme neoliberal approach of the EU policies pursued, which make the EU the most open economy in the world, was rarely questioned and the real target of this EU legislation is most likely China.

With regard to the timeframes for screening decisions, the legislation states that a decision must be made by the Minister within 90 days from the date of notification and that this may be extended by a period of up to 135 days at the discretion of the Minister. Is the 90-day limit for extreme cases or is it the Minister of State's expectation that all cases will take 90 days? With regard to the allowance for Ministers to use discretion in this instance, but also to use national security as a reason not to give information for why an investment was rejected, I hope these powers are wielded with careful consideration. Security is absolutely important but so too are openness, transparency and trust.

To return to a broader political point on investment screening and who controls assets and infrastructure in the State, the housing crisis, the energy crisis and the Covid-19 pandemic have helped to highlight the need for certain assets and infrastructure in the State to be appropriately controlled. I do not think there is any doubt in this regard.

Investment and control of assets and infrastructure are not just a problem with hostile third-country actors. There is investment from within Europe and private entities that is problematic but is rarely spoken about. The EU forced liberalisation or sell-off agenda of strategic assets has seen energy, transport and telecommunications pass into the hands of private business.

What good has the privatisation of public transport done? We saw the difficulties this caused during Covid because of the sell-off of Aer Lingus, while every week I get emails from constituents with regard to the same bus routes operated by Go-Ahead, the 33A, 33B and 102. As we deal with the energy crisis, can anyone tell us what good the sell-off and privatisation of energy has done for Ireland or anywhere else in the EU?

Businesses and people are seeing their energy bills double and treble as energy companies pay out dividends to stakeholders. What has the response across Europe been? Many countries have suspended the liberalisation of energy. France has spent more than €9 billion and concluded a public takeover bid to completely nationalise Electricité de France and Germany is nearing the full nationalisation of gas giant, Uniper.

The State has had to step back in on the telecommunications front to roll out a national broadband programme because the private market simply will not do it. Where is the oversight of domestic, EU and third-party capital used to invest in both new and second-hand properties in the Irish housing market and which is having a significant impact on the housing sector? Only this weekend, in theBusiness Post, there was a story about British weapons dealer, BAE Systems, which made €2.4 million in profit by divesting itself of 43 second-hand Irish homes that it had only bought one year previously. Where was the screening of the sell-off of these strategic assets?

Will the legislation cover companies that have invested in assets and undertakings in the State and have egregious records on workers' rights and dubious records on the protection of human rights? I doubt it, especially when we have Ministers who go on trade missions to states that have no respect for human rights - never mind workers' rights - and are engaged in wars, either directly or by proxy, that are causing untold misery.

This Bill is a significant piece of work and it is necessary. We do not want to see our strategic assets fall into the hands of hostile actors and we must do all we can to protect against that. It is important that the State defends strategic sectors, sensitive technologies and infrastructure. Given the geopolitical character of the EU legislation underpinning this Bill, I hope it is not used as an instrument to pressure Ireland or any other small states on which FDI we can and cannot accept from our larger European neighbours. While I have my political differences with the Minister of State, I trust his judgment on what is best for this State over a minister from a state that does not have Ireland's interests at heart.

While we support this investment screening Bill, it must be said there is another way to protect critical assets and infrastructure, namely, through public control over critical sectors. As I said before, in what I hope will be some food for thought for the new Minister of State to take back to his Government colleagues, we do not want to see our strategic assets fall into the hands of hostile third countries but nor do we want them to fall into the hands of private interests who have no care for this State or the people in it. Strategic assets should be kept in the hands of the Irish State.

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