Ruth Coppinger (Dublin West, Solidarity)
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316. To ask the Minister for Enterprise, Trade and Employment if he is aware of the issues surrounding the liquidation of a company (details supplied); if he will consider a review to legislation to better protect smaller and non-professional creditors is such situations; and if he will make a statement on the matter. [13806/25]

Niamh Smyth (Cavan-Monaghan, Fianna Fail)
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I understand the frustration and upset of those consumers impacted by the manner in which the company concerned ceased operations.

The State’s liquidation process is a well-established mechanism for the winding up of companies on both a voluntary and compulsory basis and can take the form of either a court-ordered insolvent liquidation or a voluntary solvent or insolvent liquidation.

Under the Irish framework, the general order of priority means that consumers are generally ranked as unsecured creditors, thereby ranking behind secured creditors, such as Revenue (on behalf of the exchequer), employees owed wages, and banks owed money on a secured loan.

The stark reality of an insolvent liquidation, where the value of the company’s assets is less that its liabilities, is that invariably there will not be enough funds to satisfy all creditors’ demands leaving the consumer unable to recover their monies.

An appointed liquidator is independent in their role and the exercise of their duties. They have a statutory role to identify, take possession of and redistribute the assets to the creditors. To do so, the liquidator must realise the value of the assets for the benefit of the insolvency estate. Neither I as the Minister nor my Department can intervene in this process.

The current law is a result of careful balancing of the various rights of creditors, including employees. While the ranking of creditors attracts much debate, any changes would also have a knock-on effect on other creditors, such as SMEs and suppliers, who are themselves employers and who, due to liquidity issues, may find themselves making their own workers redundant.

As preferential debts include rates and taxation claims, the State is also a preferential creditor and such a proposal would adversely affect the Exchequer, depriving the taxpayer of moneys owed

Limited liability is designed to encourage and foster honest enterprise by permitting individuals to engage in entrepreneurial activity while limiting personal exposure to financial loss in the event of commercial failure. However, the law demands that, in return for the privilege of limited liability, those availing of it act in good faith and abide by minimum requirements of governance, transparency and commercial probity.

Company law provides for robust compliance and enforcement mechanisms and sets out the clear legal duties that directors’ have in respect insolvency, as well as specific provisions in relation to reckless and fraudulent trading.

The Corporate Enforcement Authority (CEA), in particular, promotes high standards of corporate behaviour: It promotes compliance with company law; investigates instances of suspected breaches of company law; takes appropriate enforcement action in response to identified breaches of company law; supervises the activities of liquidators of insolvent companies; and operates a regime of restriction and disqualification in respect of directors of insolvent companies. Where a breach of company law has been established, the CEA will take action.

Finally, the Competition and Consumer Protection Commission (CCPC) is the statutory body under the remit of my Department with responsibility for promoting compliance with, and enforcing, competition and consumer law in Ireland. The CCPC is independent in the performance of its statutory functions.

Officials in the CCPC have advised that consumers affected should get the details of the liquidator and make a claim in writing setting out:

1. Details about the product they have paid for;

2. Exactly how much money they are owed; and

3. What they would like the liquidator to do, for example, arrange for delivery of the item or full refund.

In addition, if consumers affected paid the deposit by debit card or credit card, the CCPC has advised that they to contact their bank or card provider to see if it will reverse the transaction using the chargeback process.

However, there is no guarantee that claims will be successful.