Seanad debates

Friday, 6 November 2020

Investment Limited Partnerships (Amendment) Bill 2020: Report and Final Stages

 

9:30 am

Photo of Alice-Mary HigginsAlice-Mary Higgins (Independent) | Oireachtas source

Amendments Nos. 14 to 16, inclusive, address the fact that the way a majority of limited partners is calculated under this Bill is not by a simple vote of all limited partners but according to a majority shareholding, that is, who has the largest amount of shares. Again, this comes to the question of invisible control. My concern is that one may have a single limited partner who has 51% of all of the limited partner shares and can, therefore, call the shots in terms of votes.

The Minister of State might address this because he seemed to indicate earlier that wherever anybody is found to be in control of a vote, he or she will be regarded as a beneficial owner. If that is the case, then perhaps amendment No. 16 is unnecessary and the Minister of State can clarity whether that is already his interpretation. I refer to an example where a number of limited partners in a company hold more than 25% of a partnership and then one individual constitutes a majority of those limited partners. Consequently, one individual controls 13% or 14% of the 25% and, therefore, is in a position to control the majority vote, that is, to control how that 25% or more is used or reflected. That individual constitutes a majority of limited partners in terms of shares and, therefore, controls the outcome vote of a majority of limited partner. Is that person considered to be a beneficial partner, because he or she is in control of 25% or more of a vote within an investment limited partnership?

The Minister of State has suggested that where anybody was found to be in control, he or she would be the beneficial partner. In this circumstance, an individual might only hold 14% of the shares overall but that would be enough for him or her to be in control of the outcome of a 25% share.

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