Billy Kelleher (Cork North Central, Fianna Fail)

I am very pleased to be returning to this House with the Companies (Miscellaneous Provisions) Bill, as amended by the Dáil.

The Dáil amendments to this Bill are grouped into three thematic areas. Of the nine amendments made by the Dáil, six arise from the introduction of a new mechanism introduced to meet a recently identified business opportunity. This mechanism will allow collective investment funds, that are constituted as bodies corporate, to migrate their head offices into and out of Ireland without first having to wind up in their current jurisdictions. The amendments relative to this theme are Nos. 1, 2 and 6 to 9, inclusive.

As Senators will have observed, this first group of amendments is lengthy and results in over 12 pages of text being inserted into the Bill that the Seanad passed last month. I did not take the decision to propose such a long addition to the Bill lightly. However, as my colleague, the Minister of State at the Department of Enterprise, Trade and Employment, Deputy Conor Lenihan, remarked during the Second Stage debate on this Bill on 19 November, company law must respond dynamically and flexibly to opportunities and challenges arising from changes in our operating environment.

The mechanism introduced in this group of amendments is evidence of such responsiveness. It is this Government's response to a business opportunity that was brought to our attention recently by representatives of the Irish collective investment funds industry. The industry asserted that there is currently a short-term window of opportunity for Ireland to attract investment funds business from third countries if we amended our laws in the way provided for in these amendments.

The funds entities in question are seeking to relocate to well regulated jurisdictions. This would respond to investor concerns arising from the recent financial turmoil. The mechanism described in these amendments is the result of further consultations which were immediately undertaken with the industry representatives, the Financial Regulator and the Companies Registration Office. The mechanism has appropriate safeguards in place to protect Ireland's reputation as a well regulated fund management centre and the new mechanism is being restricted to funds whose activities will be or are regulated by the Financial Regulator.

In addition to meeting the short term window of opportunity identified by the funds industry I should, however, add that this mechanism will also have long term application and will add to the overall funds regulatory regime available in the State.

On the specific issues contained in each amendment within this group, amendment No. 7 is the substantive amendment and outlines in detail the mechanism which will apply to inward and outward migrating collective investment funds entities. It does this by amending section 3 and thereby inserting three new sections into the Companies Act 1990. The new section 256F describes in detail the arrangements that will apply to inward migrating funds, while the new section 256G outlines the situation for outward migrating funds. The third new section 256H outlines further requirements relating to statutory declarations touching on solvency that must be made by directors of both inward and outward migrating funds. Amendment No. 8 cross-applies this migratory mechanism to the UCITS regulations. This is being done on the basis that UCITS fund companies are also regulated by the Financial Regulator. The remaining amendments in this group are consequential on the two amendments I have just described. Amendment No. 6 is an amendment to the punctuation in the existing text of the Bill to facilitate the insertion of the new sections. Amendment No. 9 has the effect of providing that the funds migrating mechanisms will come into operation when commencement dates have been ordered by the Minister, while amendments Nos. 1 and 2 are adjustments to the Long Title of the Bill that are necessary to allow the migrating mechanism be cross-applied to UCITS constituted as companies.