State development company Údarás na Gaeltachta has denied that guaranteed harvesting rights on the west coast were part of a deal to sell its shares in seaweed company Arramara Teo to a Canadian multinational.

However, the Canadian buyer, Acadian Seaplants Ltd, has told an Oireachtas committee on environment, culture and the Gaeltacht that unlicensed harvesting by traditional cutters will threaten the sustainability of the resource and will result in a "shutdown" of the industry.

Were licensing rights vested in a co-operative of harvesters, rather than in seaweed companies, Chinese buyers seeking seaweed for its fracking industry could offer higher prices and threaten security of supply , Mr Jean-Paul Deveau of Acadian and chief executive of Arramara Teo told the committee yesterday (TUES).

Six Irish seaweed companies and a representative of traditional harvesters, who appeared before the committee, criticised the sale of Arramara Teo to Acadian Seaplants Ltd for an undisclosed sum in a deal completed in early May, 2014.

The companies also told committee members that there had been unexplained delays in renewing their harvesting licenses.

Mr John Bhaba Jeaic Ó Conghaíle, representing harvesters with Cearta Cladaigh Chonamara, Mr Tony Barrett and Mr Sean Ó Mocháin of Irish Seaweed Processors Ltd said that the licensing rights must remain with existing harvesters, who had maintained the resource successfully for 67 years.

Mr John O'Sullivan, chief executive of Bioatlantis Ltd in Co Kerry called on the Oireachtas environment committee to investigate the sale, or ask the Oireachtas public accounts committee to do so.

Mr O’Sullivan said that his company had made a bid of €5.7 million for Arramara, comprising €1.5 million initially and €4.2 million in the post-investment phase, and had been given just 12 days to prepare the bid.

He understood that two foreign companies – the Canadian Acadian Seaplants and French company Setalg – had been given over a year to prepare their bids.

He said that Acadian’s bid was €1.8 million, and the French bid was €2 million, for initial purchase, and that the rating was “changed” when the final bids were in.

No details had been released and the lack of transparency was “frightening” in relation to the final sale, he said.

He said he was disillusioned with Údarás na Gaeltachta and with the political system in this country, as the sale had allowed Acadian Seaplants to control the Irish resource.

Mr O’Sullivan said that no one company should control more than 25 per cent of the coastal resource, and licenses should only be granted to responsible processors, given the need to protect designated habitats.

His company, which had grown at an annual rate of 45 per cent, had invested in research and equipment to add value to Ascophyllum nodosum (italics), the main species harvested on the Irish coast. It was exporting to 30 countries worldwide, including China, he said, but its future was now very uncertain.

The Canadian system of harvesting, imported in the 1980s from Norway, was not suitable for Ireland, Mr O'Sullivan said.

Mr Deveau confirmed during questioning that he had met officials from the Department of Marine and the Environment prior to the sale, with one meeting in 2007.

The company is seeking harvesting rights in 21 areas from Belmullet, Co Mayo, to Ballyvaughan, Co Clare, which constituted 20 per cent of this coastline, and it was negotiating with two existing companies on continued supply, he said.

The new partnership would result in “an Irish success story”, Mr Deveau said.

Udáras na Gaeltachta chief executive Steve O Cualáin defended the sale and said that growth of Arramara to avail of a “significantly expanding global market for the seaweed sector” required a regulated environment to attract investment.

"Unregulated harvesting" represented "the greatest threat" to the resource, he said - a claim disputed by a number of Oireachtas committee members, including Fianna Fáil TD Éamon Ó Cuív and Sinn Féin senator Trevor Ó Clochartaigh.

Socialist Party TD Ruth Coppinger said she found it "very strange" that the Gaeltacht development authority charged with encouraging indigenous business would sell the seaweed company to a foreign buyer.