Thought you couldn't fly a JAA registered airplane without the correct licence. This implies that the IAA are rather spineless.
Did you miss the sentence in the article that specificaly deals with that?
FAA licences are acceptable for initial validation and all pilots will need to work toward gaining their JAR licence which can be succesfully achieved within 6-9 months.
Seems perfectly reasonable to me. I've heard of FAA licensed pilots getting a 6 or 12 month temporary grant to fly European Aircraft.... I think an assessment including simulator checks and written papers is required. Not absolutely sure of that and this info is second hand.