Michael Ahern (Cork East, Fianna Fail)

Amendment 28 adds a new paragraph (n) to section 56(1) — section 53(1) in the Seanad text — which amends section 60 of the 1963 Companies Act. Tax law provides that employee share ownership trustees must be incorporated as subsidiaries of the company in which the employee share option trust, on behalf of the employee share option plan, will acquire the shares. In addition, it is not unusual for non-Revenue approved arrangements to have as the trustee, a subsidiary of the company whose shares are acquired. This amendment is accordingly designed to allow these forms of financial assistance to operate.

Amendment 29 relates to new section 75, inserted to address a problem arising from the present scope of the Irish Takeover Panel Act 1997, which brings issuers of non-voting debt instruments under the remit of the takeover panel, if those instruments are listed on the Irish Stock Exchange. The provision is causing concern for the Stock Exchange and the takeover panel. The Stock Exchange is now a major centre for the listing of debt instruments, having achieved significant growth in the past three years.

An emergence of a large number of domestic Irish issuers of debt has also occurred, mainly in the international financial services sector. This growth has been encouraged by governmental initiatives which accept that debt issuance represents a significant opportunity for Ireland to go "up the value chain" as regards financial services activities. The recent Deloitte report sponsored by the IDA placed debt issuance at the top of the strategic aims for Ireland as a financial services centre. It would not be in keeping with this strategy if those Irish bond issuers were required to list in a country such as Luxembourg in order to avoid this legislation.

This issue was not identified when the legislation was enacted and the takeover panel has no desire for the legislation to have this effect. We are not aware of any other jurisdiction where the remit of the local equivalent to the takeover panel goes beyond traditional voting equity shares in this manner. Moreover, the focus the 13th EU directive on takeovers, which must be transposed into Irish law by 2006, is on equity shares with voting rights. The amendment also ensures that a company listing only equity securities in London and only debt securities in Dublin will come within the remit of the takeover panel.

Amendment 31 adds a new section 87. In Parts 2, 3, 4 and 5 of the Bill, certain functions are given to the Central Bank and Financial Services Authority of Ireland. It was always the intent that these would be discharged by IFSRA. No difficulty arises in Part 3, as this part amends Part XIII of the 1990 Act. However, in respect of Parts 2, 4 and 5 we were advised by the Office of the Attorney General and the Office of the Chief Parliamentary Counsel that the necessary designation should be done by way of primary law.

Separately, the Department of Finance already had under consideration some changes to the Second Schedule of the Central Bank Act, and was proposing to add other statutory provisions to the Second Schedule. The amendment in subsection (2) makes all the changes needed to the Second Schedule in primary law. The amendment in subsection (1) ensures that the administrative sanctions regime set up in the Central Bank and Financial Services Authority of Ireland Act 2004 do not apply to the market abuse and prospectus provisions.