Paul Kehoe (Wexford, Fine Gael)
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Question 66: To ask the Minister for Enterprise, Trade and Employment the changes he will make to company law with regard to residential management companies; and if he will make a statement on the matter. [31338/07]

Micheál Martin (Cork South Central, Fianna Fail)
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The Government has approved the drafting by the Office of the Parliamentary Counsel of the Companies Consolidation and Reform Bill along the lines of the General Scheme prepared by the Company Law Review Group.

The General Scheme was designed to provide an appropriate framework for the formation and operation of companies and is framed primarily with private, commercially operating, companies in mind. The underlying philosophy behind the proposals in the General Scheme is to simplify company law for the benefit of business operators and company law practitioners.

Recognising the role that company law could play in relation to property management companies, the Company Law Review Group consulted widely on its proposals and gave specific consideration to that aspect. As a result, the General Scheme contains a number of provisions with the express intention of facilitating the use of the company structure by multi-unit developments. For example, the membership limit of 99 which will ordinarily apply to the most common company type, the private company limited by shares, will not apply in the case of a residential management company. Also, the membership of a residential management company will be deemed to transfer from the vendor to the purchaser upon the sale of the underlying property to which the membership relates. These proposals represent very specific carve-outs from the general provisions concerning the standard private company limited by shares.

Finally, I should point out that the regulation of specific sectors, or the specific activities that companies engage in, can be treated by way of provisions in the company 'constitution' (currently known as the Memorandum and Articles of Association), as provided for in the General Scheme.