Tánaiste and Minister for Enterprise, Trade and Employment, Ms. Mary Coughlan, T.D., has announced that the Government today, Tuesday, 31st March 2009, approved her proposals to bring forward urgent legislation to amend the Companies Acts. She also announced that she has increasing the resources of the Office of the Director of Corporate Enforcement.

The Tánaiste said: “The provisions of this Bill, combined with the increased resources I am providing to the Director of Corporate Enforcement demonstrate this Government’s commitment to ensuring that Irish companies operate to the highest standards”.

In light of events in the financial area, the Tánaiste earlier this year asked the Director of Corporate Enforcement to consider whether any legislative improvements were required in the company law area in the short term. His suggestions are captured in the proposal agreed by Government today.

The new Bill will improve the transparency of loans made by financial companies to their directors by removing provisions that allow banks avail of a different disclosure regime compared to non-banking companies. In future, the annual accounts of financial companies will have to disclose a loan made to named directors, rather than in aggregate form as applies at present. They will also have to show the maximum amounts of each director’s liability during the year, rather than the outstanding balance at the end of the financial year.

The Tánaiste reaffirmed her commitment to ensuring that the Director of Corporate Enforcement would have the powers he needs to enforce compliance with the Companies Acts, whether these companies are banks or not. The Bill therefore contains a number of amendments sought by the Director.

Specifically, it will clarify the right of access of the Office of Director of Corporate Enforcement to certain records of the company under investigation and to certain related third party records.

It will lighten the evidential requirement on the Director so that he will not have to prove a director was wilfully in breach of the loans to director’s provisions of Company Law.

It will also strengthen the provisions dealing with search warrants and will provide a mechanism for the Courts to determine whether legal professional privilege attaches to some seized material.

The Tánaiste also confirmed that the Director of Corporate Enforcement’s request last week for additional staffing has been granted and that staff from within her own and other departments will be re-deployed to his Office. This will facilitate the carrying out of ongoing investigations and allow his Office to continue to perform its other functions to the highest standard.

She stated: “I have agreed to the request of the Director of Corporate Enforcement for additional staff and I have instructed my Department to put these resources in place as a matter of urgency.”

(This press release is available on the Departments website at www.entemp.ie)
31 March, 2009

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Department of Enterprise, Trade and Employment
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