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9 1986

INDUSTRIAL DEVELOPMENT ACT, 1986

PART III

Industrial Incentives

Authority's general grant-making powers.

[1969, ss. 33, 34. New in pt.]

21. —(1) The Authority may make a grant, on such terms and conditions as it thinks proper, towards the cost of fixed assets of or for an industrial undertaking to which this section applies.

(2) The amount of a grant under subsection (1) shall not exceed 60 per cent. of the cost of the fixed assets in the case of an industrial undertaking in a designated area or 45 per cent. of the cost of the fixed assets in the case of an industrial undertaking elsewhere than in a designated area.

(3) This section applies to an industrial undertaking in respect of which the Authority is satisfied that it—

(a) will produce products for sale primarily on world markets, in particular those products which will result in the development or utilisation of local materials, agricultural products or other natural resources; or

(b) will produce products of an advanced technological nature for supply to internationally trading or skilled sub-supply firms within the State; or

(c) will produce products for sectors of the Irish market which are subject to international competition; or

(d) is a service industry as specified by the Minister by order under section 3 .

(4) The industrial undertaking shall also satisfy the Authority that—

(a) financial assistance is necessary to ensure the establishment or development of the undertaking;

(b) the investment proposed is commercially viable;

(c) it has an adequate equity base;

(d) it has prepared a suitable company development plan; and

(e) it will provide new employment or maintain employment in the State that would not be maintained without assistance given under this Act and increase output and value added within the economy.

(5) (a) The Authority may, in the case of small industrial undertakings as defined from time to time by the Minister, make a grant on such terms and conditions as it thinks proper in respect of any additional person employed in such an undertaking.

(b) A grant under this subsection shall be subject to such financial limits and such other terms and conditions as may from time to time be specified in a scheme governing the making of such grants sanctioned by the Minister with the concurrence of the Minister for Finance.

(c) A grant under this subsection shall not be reckoned in the calculation of the maximum grants payable to the undertaking concerned for the purposes of subsection (2) and section 33 .

Grants for fixed assets leased.

[1969, ss. 35, 47]

22. —(1) The Authority may make a grant on such terms and conditions as it thinks proper in respect of the cost of fixed assets which have been leased for the purpose of an industrial undertaking which conforms to the criteria set out in subsections (3) and (4) of section 21 .

(2) The amount of a grant under this section shall not exceed 60 per cent. of the cost of the fixed assets in the case of an industrial undertaking in a designated area or 45 per cent. of the cost of the fixed assets in the case of an industrial undertaking elsewhere than in a designated area.

(3) Where a grant under this section is payable by instalments over a period of years, the amount of grant shall, for the purposes of subsection (2), be taken to be the capital value of such instalments as determined by the Authority.

(4) Where land is leased by the Authority to or for an industrial undertaking at a rent less than the economic rent as determined by the Authority the capital value of the difference between the rent so payable and the economic rent so determined shall be deemed to be a grant for the purposes of this section.

Grants towards reduction of interest.

[1969, s. 36]

23. —(1) The Authority may, in the case of an industrial undertaking which conforms to the criteria set out in subsections (3) and (4) of section 21 , make a grant on such terms and conditions as it thinks proper towards a reduction of the interest payable on a loan raised to provide fixed assets for that undertaking.

(2) The amount of a grant under this section shall not exceed 60 per cent. of the cost of the fixed assets in the case of an industrial undertaking in a designated area or 45 per cent. of the cost of the fixed assets in the case of an industrial undertaking elsewhere than in a designated area.

(3) Where a grant is made by the Authority under this section, the grant shall be in such form and on such terms and conditions as may be specified in a scheme governing the making of such grants sanctioned by the Minister with the concurrence of the Minister for Finance.

Guarantee of loans.

[1969, s. 37; 1981, s. 5]

24. —(1) The Authority may guarantee the due repayment of part (not exceeding 80 per cent.) of the principal of any money (including money in a currency other than the currency of the State) borrowed in respect of fixed assets of an industrial undertaking or the payment of interest on such money or both the repayment of the principal and the payment of such interest, if (in each such case) the undertaking conforms to the criteria set out in subsections (3) and (4) of section 21 .

(2) Whenever a loan is guaranteed under this section, the guarantee shall be in such form and manner and on such terms and conditions as may be specified in a scheme governing the giving of such guarantees sanctioned by the Minister with the concurrence of the Minister for Finance.

(3) Money required by the Authority to meet sums which may become payable by the Authority under a guarantee shall be paid out of funds at the disposal of the Authority.

(4) The capital value of a loan guarantee under this section shall be reckoned in the calculation of grants for the purpose of sections 33 and 34 and shall be determined in accordance with such terms and conditions as may be specified in the scheme referred to in subsection (2).

(5) The Authority shall not, without the prior permission of the Government, give in respect of a particular industrial undertaking a guarantee under this section where the amount of the principal of any money guaranteed exceeds £750,000.

(6) Section 14 (4) applies to a guarantee under this section in money in a currency other than the currency of the State.

Employment grants to service industry.

[1981 (No. 2), s. 2. New in pt.]

25. —(1) The Authority may make a grant (in this section referred to as an employment grant), on such terms and conditions as it thinks proper, towards the employment of persons in a service industry carried on as a separate undertaking.

(2) An employment grant may be made where, in the opinion of the Authority, the service industry would contribute significantly to regional and national development and, in particular—

(a) would be commercially viable,

(b) would have good prospects for growth, and

(c) would not be developed in the absence of an employment grant.

(3) The amount of an employment grant shall be subject to such financial limits as may be fixed from time to time by the Minister with the concurrence of the Minister for Finance.

(4) The Authority shall not, without the prior permission of the Government, give in respect of a particular undertaking an employment grant or grants exceeding in the aggregate £1,250,000.

Guarantee of loans and interest subsidy for restructuring industry.

[1977, s. 2; 1981, s. 6]

26. —(1) For the purpose of promoting the restructuring of industry, the Authority may, in the case of the acquisition by an industrial undertaking of the whole or part of another industrial undertaking or in the case of an amalgamation between two or more industrial undertakings, in addition to any other power conferred on it by this Act—

(a) make a grant, on such terms and conditions as it thinks proper, towards the reduction of interest payable on a loan raised in connection with such an acquisition or amalgamation,

(b) guarantee the due repayment of the whole or part of the principal of any money (including money in a currency other than the currency of the State) borrowed in connection with such an acquisition or amalgamation or the payment of interest on such principal or both the repayment of the principal and the payment of such interest.

(2) The Authority shall not, without the prior permission of the Government, give a guarantee in respect of money borrowed in connection with an acquisition or amalgamation referred to in subsection (1) or make a grant towards the reduction of interest payable on a loan raised for such purposes where the amount of the principal of any money the subject of the guarantee and the amount of the grant payable towards the reduction of interest exceed in the aggregate £750,000.

(3) Section 14 (4) applies to a guarantee under this section in money in a currency other than the currency of the State.

Guarantee of loans and interest subsidy for enterprise development.

[1977, s. 3; 1981, s. 7]

27. —(1) For the purpose of encouraging the establishment of an industrial undertaking which conforms to the criteria set out in subsections (3) and (4) of section 21 by a suitably qualified person who has not, or has not to a significant extent, previously been an owner of an industrial undertaking, the Authority may, in addition to any other power conferred on it by this Act—

(a) make a grant, on such terms and conditions as it thinks proper, towards the reduction of interest payable on a loan raised to provide working capital for such an undertaking,

(b) guarantee the due repayment of part (not exceeding 80 per cent.) of the principal of any money (including money in a currency other than the currency of the State) borrowed in respect of working capital for such an undertaking or the payment of interest on the part so guaranteed of such principal or both the repayment of such part and the payment of such interest.

(2) The Authority shall not, without the prior permission of the Government, give a guarantee in respect of money borrowed in respect of working capital for an undertaking referred to in subsection (1) or make a grant towards the reduction of interest payable on a loan raised to provide working capital for such an undertaking, where the amount of the principal of any money the subject of the guarantee and the amount of the grant payable towards the reduction of interest exceed in the aggregate £300,000.

(3) Section 14 (4) applies to a guarantee under this section in money in a currency other than the currency of the State.

Training grants.

[1969, s. 39; 1981, s. 4]

28. —(1) Following consultation with An Comhairle Oiliúna, the Authority may make a grant (in this section referred to as a training grant), on such terms and conditions as it thinks proper, for the training (either in the State or elsewhere) of persons in the processes of an industrial undertaking, if the undertaking conforms to the criteria set out in subsections (3) and (4) of section 21 and the training so provided will assist the undertaking to achieve the objectives of the said subsection (3).

(2) A training grant may be made for the training of persons for positions of supervision or management in an industrial undertaking or for the engagement of instructors, technical advisers or consultants to train (or assist in the training of) persons for such positions.

(3) The amount of training grants made in respect of a particular industrial undertaking shall not exceed the sum of the amount of wages or salaries paid by the undertaking during the period of training to the persons being trained, the amount of expenses paid to those persons by the undertaking for travel and subsistence and the amount paid by the undertaking in respect of fees (including fees and remuneration of instructors, advisers and consultants) and similar expenses connected with the training.

(4) The Authority shall not, without the prior permission of the Government, give in respect of a particular industrial undertaking training grants exceeding in the aggregate £2,000,000.

Research grants.

[1969, s. 40; 1981, s. 8. New in pt.]

29. —(1) Following consultation with such bodies as may be specified by the Minister from time to time, the Authority may make a grant (in this section referred to as a research grant), subject to subsection (5), on such terms and conditions as it thinks proper towards the cost of projects of research and development to which this section applies.

(2) This section applies to projects of research and development which—

(a) have as their primary object the promotion or development of new or improved industrial processes, methods or products in the State, and, in particular, such processes, methods or products as are likely either to involve the use or development of local materials, agricultural products or other natural resources or to offer prospects of expansion in existing industry, promotion of new industry or to increase industrial employment, and

(b) are carried out wholly or mainly in the State and wholly or mainly sponsored by one or more than one industrial undertaking in the State.

(3) For the purpose of a research grant the Authority may consult such adviser, consultant, institute or other organisation or person as it considers proper.

(4) (a) Subject to paragraph (b), the amount of a research grant shall not exceed 50 per cent. of the approved costs of the project concerned or £250,000, whichever is the smaller sum.

(b) The amount of a research grant may, with the approval of the Government in a particular case, exceed £250,000 by such sum as the Government shall in that case specify, provided that the percentage limit specified in paragraph (a) is not exceeded.

(c) In this section “approved costs” means in relation to a particular research grant, such expenditure by the industrial undertaking or undertakings concerned as the Authority is satisfied has been or will be incurred for the purpose of promoting the project concerned and has been or will be expended on—

(i) the provision of sites or premises (including the acquisition of land), the construction and adaptation of buildings, and the provision of services and other works;

(ii) the provision of plant, machinery, equipment and materials;

(iii) the payment of fees or other remuneration to technical advisers consulted in connection with the project;

(iv) the salaries and wages paid to and the travel and subsistence expenses of persons engaged on the project or in identifying product or process development prospects within the industrial undertaking; and

(v) overhead charges associated with the project concerned.

(5) The Authority may, in the case of small industrial undertakings as defined from time to time by the Minister, make payment of up to one-third of a research grant prior to the approved costs being incurred on condition that the amount so paid shall be repaid to the Authority if the research or development project concerned has not been carried out to the satisfaction of the Authority.

(6) The Authority shall not make a payment under subsection (5) unless it is satisfied that the industrial undertaking has available to it sufficient assets to cover its liability under that subsection.

(7) The Authority shall not, without the prior permission of the Government, give in respect of a particular industrial undertaking, research grants exceeding in the aggregate the higher of:—

(a) £500,000; or

(b) £500,000 in excess of the aggregate amount of research grants for which the permission of the Government has previously been obtained by the Authority.

Technology acquisition grants.

30. —(1) Following consultation with such bodies as may be specified by the Minister from time to time, the Authority may make a grant (in this section referred to as a technology acquisition grant) to an industrial undertaking on such terms and conditions as it thinks proper towards the costs of acquiring product or process technology to which this section applies, if the undertaking conforms to the criteria set out in subsections (3) and (4) of section 21 and the product or process technology so acquired will assist the undertaking to achieve the objectives of the said subsection (3).

(2) Product or process technology for the purpose of this section shall include patents, designs, trade marks, trade secrets, copyright, proprietary and non-proprietary information and techniques.

(3) This section applies to the acquisition of product or process technology which has as its primary object the improvement of the technological capability of one or more than one industrial undertaking and the production or application of advanced industrial processes or products in the State.

(4) For the purpose of a technology acquisition grant the Authority may consult such adviser, consultant, institute or other organisation or person as it considers proper.

(5) (a) Subject to paragraph (b), the amount of a technology acquisition grant shall not exceed 50 per cent. of the approved costs of acquisition of the technology concerned or £250,000, whichever is the smaller sum.

(b) The amount of a technology acquisition grant may, with the approval of the Government in a particular case, exceed £250,000 by such sum as the Government shall in that case specify, provided that the percentage limit specified in paragraph (a) is not exceeded.

(c) In this section “approved costs” means in relation to a particular technology acquisition grant, such expenditure by the industrial undertaking or undertakings concerned as the Authority is satisfied has been incurred for the purpose of acquiring the product or process technology concerned and has been expended on—

(i) acquiring or an option to acquire a licence or knowledge of a product or method of production;

(ii) the payment of fees or other remuneration to technical advisers consulted in connection with the acquisition of the technology; and

(iii) the salaries and wages paid to, and the travel and subsistence expenses of persons engaged in the acquisition of the technology.

(6) The Authority shall not, without the prior permission of the Government, give in respect of a particular industrial undertaking, technology acquisition grants exceeding in the aggregate the higher of:—

(a) £500,000; or

(b) £500,000 in excess of the aggregate amount of technology acquisition grants for which the permission of the Government has previously been obtained by the Authority.

[New]

Power to purchase shares.

[1969, s. 44; 1977, s. 9; 1981, s. 9. New in pt.]

31. —(1) Where, in the opinion of the Authority, an industrial undertaking conforms to the criteria set out in subsections (3) and (4) of section 21 , the Authority may, out of funds at its disposal—

(a) purchase or take shares, to any extent it may consider desirable, in the body corporate owning, controlling or managing the undertaking or in a body corporate participating in the ownership, control or management of the undertaking,

(b) form or take part with other persons in the formation of such bodies corporate,

but no shares shall be purchased or taken by the Authority except after consultation with any body (in this subsection referred to as a State-sponsored body) specified for the purposes of this subsection by the Minister by order nor where as a result the Authority itself, or the Authority and any State-sponsored body or bodies together, would hold more than half in nominal value of the share capital or more than half in nominal value of shares carrying voting rights (other than voting rights which arise only in specified circumstances) in a body corporate, unless the Minister shall have approved of the proposed purchase or taking of shares.

(2) Shares purchased or taken by the Authority under this section shall be registered in the name of the Minister for Finance.

(3) All amounts representing dividends or other money received by the Minister for Finance in respect of shares purchased or taken under this section shall be paid into or disposed of for the benefit of the Exchequer in such manner as the Minister for Finance may direct.

(4) The Authority shall not, without the prior permission of the Government, expend more than £1,500,000 in the purchase or taking of shares in a particular body corporate.

Grants to secure reduction of factory rents.

[1966, s. 9; 1969, s. 46]

32. —(1) Where, in the opinion of the Authority, a factory building is, or is intended to be, used for the purpose of or in connection with the carrying on of an industrial undertaking which conforms to the criteria set out in subsections (3) and (4) of section 21 and is held under a lease or other letting subject to a rent or other payment, the Authority may make grants, upon such terms and subject to such conditions as it thinks proper to impose, to the person entitled to the rent or other payment to enable him to reduce such rent or payment.

(2) The Authority may, in lieu of making a grant to a person under subsection (1), make the grant on such terms and conditions as it thinks proper to the industrial undertaking (or intended undertaking) concerned.

(3) The amount of a grant under this section shall not exceed the amount of the grant which may be made in respect of a factory building under section 21 .

(4) Where a grant under this section is payable by instalments over a period of years, the amount of grant shall be taken to be the capital value of such instalments as determined by the Authority.

Percentage limits on aggregate of certain grants.

[1969, s. 41. New in pt.]

33. —(1) Where in respect of an industrial undertaking grants or a loan guarantee have been made under two or more of the sections to which this section applies, the aggregate amount of such grants together with the capitalised value of the loan guarantee under section 24 shall not exceed the percentage limits specified in section 21 (2).

(2) This section applies to sections 21 , 22 , 23 and 32 .

Total amount of grants.

[1969, s. 42; 1981, s. 3. New in pt.]

34. —Without the prior permission of the Government the total amount of money granted under one or more of the following sections, namely, sections 21 , 22 , 23 and 32 , together with the capitalised value of a loan guarantee under section 24 , to or in respect of a particular industrial undertaking shall not exceed £2,500,000.

Government's power in regard to industrial incentives.

35. —Where, under any of the preceding sections of this Part, the permission of the Government is required for the making of a grant or loan guarantee or the purchase of shares, the Government may, in lieu of granting such permission, grant permission to the Authority for the expenditure of a lower amount in respect of such grant, guarantee or purchase or may grant permission subject to such conditions as the Government may specify.

[New]

Authority's powers to value assets, etc.

[1969, s. 43]

36. —For the purpose of making a grant or other payment under this Part, the Authority may, subject to the provisions of this Part, determine at its discretion the cost or value of assets of an industrial undertaking or the capital value of any payments made to or benefits received or receivable by an industrial undertaking.

Contravention of term or condition attached to grant or other payment.

[1969, s. 45]

37. —Whenever there is a contravention of a term or condition attached to a grant or other payment under this Part, the amount of such grant or payment shall be repayable to the Authority and in default of being so repaid may be recoverable by the Authority as a simple contract debt.