The new Companies Bill is expected to be enacted by Christmas. And it is also to include other measures to reduce costs for businesses and improve enforcement of company law.
The Minister for Jobs, Enterprise and Innovation, Richard Bruton TD, and the Minister of State for Small Business, John Perry TD, today announced the fast-tracking of legislation to allow businesses to apply to the Circuit Court for examinership.
The measure, part of the Government’s Action Plan for Jobs, is aimed at reducing the costs associated with an application for examinership and enabling increased numbers of businesses – in particular SMEs – to apply for examinership as a route out of difficulties. In particular, businesses with large potential for growth and job-creation, but who are being held back by legacy debt problems, are expected to benefit from the move.
According to the Department of Justice, costs in the Circuit Court are on average 30% lower than in the High Court, subject to the complexity of the case.
The Companies (Miscellaneous Provisions) Bill will now be drafted on a priority basis by the Office of the Parliamentary Counsel, and enactment by end 2013 is targeted.
Other provisions contained in the Bill include a measure aimed at reducing the cost of compliance for businesses by making it easier to file statutory accounts online.
Minister Bruton said: “There are 200,000 small businesses in Ireland employing over 650,000 people, over a third of our total workforce. Many of these businesses have great growth potential but face legacy debt problems after the crisis, due in some cases to property investments, in others to trading difficulties in others to unsustainable rents. We believe that if we can create a mechanism for them to deal with these legacy problems we can not only save large numbers of jobs but also unlock the potential for the growth and job-creation we so badly need.
“Today’s announcement that small companies will be able to apply to the Circuit Court for examinership will mean that it will be cheaper and easier for businesses to restructure their debts, meaning that more companies will be able to do so. This will mean that more businesses can survive their current difficulties and start to grow, meaning crucially that more jobs will be saved and more jobs will be created in this hugely important part of the economy”.
“This is part of a programme of measures which we are putting in place through the Action Plan for Jobs to support SMEs, including for example a streamlined support service for small and micro-businesses through reforms to the CEBs and local authorities, and a range of new credit schemes totalling more than €2billion in new funding for businesses.
“We believe that with the proper Government support more businesses can survive their current difficulties and start to grow, meaning crucially that more jobs will be saved and more jobs will be created in this hugely important part of the economy”.