Brendan Ryan (Labour)

I welcome the Minister of State and his officials. This is a short Bill, although the Minister of State spent considerable time setting out the context for its introduction. I was not sure before this morning whether to welcome the legislation and decided to await greater clarity on its purpose. However, the Minister of State did not provide greater detail than that contained in the explanatory memorandum. It appears the legislation is motivated by a requirement to address urgent matters and that these could not await promised legislation. I ask the Minister of State to elaborate and clarify the reasons for the introduction of the legislation.

The two key elements of the Bill are the measures to allow the use of United States generally accepted accounting principles, GAAP, on a temporary basis for certain categories of company and to remove the cap on the contribution of companies towards costs incurred in court cases and reduce the State's exposure in this regard. While these measures are welcome, I seek greater clarity on the reason for the introduction of the measure on GAAP. I ask the Minister of State to outline what are the key differences between US and Irish generally accepted accounting principles. Greater clarity is also required on which category of company may use US generally accepted accounting principles. It appears the measure will apply to the parent undertakings of companies based in Ireland. I ask the Minister of State to clarify the matter.

I support Senator Donohoe's request for information on the number of companies affected by the measures and the potential level of exposure. I also ask the Minister of State to give specific examples of the companies affected. He indicated that we need to avail of opportunities to attract foreign direct investment. Obviously, everyone supports foreign direct investment. Given that the arrangement for the use of US GAAP applies to companies already operating in Ireland, to what extent will it encourage new companies to invest here?

In light of the urgency with which the legislation is being introduced, is there a danger that companies based here may pull out of if the measure is not introduced? To what extent do other European Economic Area countries provide flexibility of this nature to investing companies? Why will the transitional arrangement cease to have effect from 31 December 2015? What will be the position regarding companies seeking to invest after that date? I am a little uncomfortable with this arrangement and ask the Minister of State to clarify the matter.

Section 2 gives the Minister the power to make regulations providing for the use of other international accounting standards. If the Minister chooses to exercise this power, the matter should be debated in the House. I am aware that United States accounting standards are high, having experienced the introduction of Sarbanes-Oxley standards in a previous employment. For this reason, I have no fear of US standards in terms of the hoops they put companies through, although they are costly and create considerable stress for some people.

Will the Minister of State elaborate on the reason the legislation is being introduced with such great urgency? Senator Boyle suggested the Bill has been introduced in response to recent controversies. I do not detect a link between the new measures and recent controversies. Perhaps the Minister of State will comment.