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Dublin: 12 °C Monday 1 September, 2014

This TD claims his bill could save thousands of jobs – and create thousands more

Stephen Donnelly wants to amend the Companies Act to facilitate an easier examinership process.

Independent TD Stephen Donnelly
Independent TD Stephen Donnelly
Image: Laura Hutton/Photocall Ireland

INDEPENDENT TD STEPHEN Donnelly is to introduce a bill aimed at cutting the cost of companies going into examinership by as much as half.

The Wicklow deputy’s Companies Amendment Bill 2014 will be introduced in the Dáil as part of private members’ time later today.

The proposed legislation aims to reduce the cost of the current examinership process by tens of thousands of euro by cutting out legal fees and fees incurred by an examiner in preparing for court proceedings.

The bill would facilitate business owners and their creditors meeting outside of the courts to try and agree a strategy to save a company rather than putting it into receivership – an option of last resort that usually results in a firm being wound-up.

Donnelly points out that the difficulties in going through examinership means that between 2011 and 2013 there were 64 examinerships, whereas during the same period there were 1,046 receiverships.

The bill is aimed at small business with fewer than 50 employees and a turnover of less than €10 million

Donnelly also insists that the bill will not unfairly prejudice creditors as they would be prevented from receiving less in the examinership process than they would if the company was put into receivership.

Donnelly cites Central Bank figures in claiming that half of all loans to small and medium sized businesses in Ireland are in distress.

With small businesses accounting for 70 per cent of the jobs in the State he claims his bill is likely to result in thousands of jobs being saved and tens of thousands being created as businesses “begin to thrive again”.

The government is likely to make its position on the legislation clear prior to the debate later today.

View: Slideshow produced by Stephen Donnelly explains how the legislation would work >

Explainer: What does liquidation, examinership and receivership mean?

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