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Question

196. Deputy Clare Daly asked the Minister for Justice and Equality his plans to amend legislation, secondary or primary, to tighten up regulation of companies which offer foreign property investment opportunities to ordinary investors in view of numerous instances of such companies retaining deposits on properties that are never built. [43002/17]

Answer

Minister for Justice and Equality (Deputy Charles Flanagan): The Property Services Regulatory Authority (PSRA) was established on 3 April 2012 pursuant to the provisions of the Property Services (Regulation) Act 2011. The PSRA is mandated to control, supervise and regulate Property Service Providers (PSPs), i.e. auctioneers/estate agents, letting agents and management agents. The PSRA, which is independent in the performance of its statutory functions, operates a comprehensive licensing system in respect of all PSPs, administers a system of investigation and adjudication of complaints against PSPs, and maintains a sector funded compensation fund where licensed PSPs have acted dishonestly.
The provision of property services by a licensed PSP or a relevant person (as provided for under Section 82 of the 2011 Act, i.e. property service providers from other EU countries), includes the auction of property other than land, the purchase or sale, by whatever means of land (including property), the letting of land and/or property management services in respect of property both within and outside the State. The purchase or sale of overseas properties by licensed PSPs is a property service for the purposes of the Act if the service is provided in the State.
Section 65 of the 2011 Act provides for the PSRA to investigate complaints made against licensed PSPs. Following an investigation where a licensed PSP is found to be negligent in retaining a booking deposit, a sanction may be imposed and or a claim against the PSP's professional indemnity insurance may be made. However, where an act of dishonesty is established against a licensed PSP, the client may make a claim on the Property Services Compensation Fund.
I am advised by the Authority that this is not an issue which has been brought to its attention to date. Accordingly, there are no specific plans at this time for legislative change to the property services regulatory regime to address this specific matter. However, it may be the case that other Irish regulatory bodies may have a more direct responsibility in this regard, for example, the Central Bank, as the regulator of investment companies.