Is Irish film Once ineligible for Oscar nomination?

A news story in the print edition of today's Sunday Tribune by my colleague, music writer Una Mullally, reveals that the Oscars' Academy is investigating the eligibility of Glen Hansard's song 'Falling Slowly' which has been nominated in the Best Original Song category for the Irish film Once.

According to Mullally:
"The Sunday Tribune understands that the Academy query relates to whether the song, from the John Carney-directed movie Once, was written specifically for the film, as the eligibility rules for the Best Original Song category demand.
‘Falling Slowly’ was originally recorded by the film’s co-stars Glen Hansard and Marketa Irglova when Czech director Jan Hrebejk asked the two musicians to contribute songs to his 2006 film Kráska v nesnázích (Beauty In Trouble). Hansard and Irglova ended up recording the album The Swell Season, of which ‘Falling Slowly’ was a key track. That album was released in April 2006. Hansard’s band, The Frames, then rerecorded the song for their September 2006 album The Cost. Beauty In Trouble was released in October 2006, with ‘Falling Slowly’ played almost in full over the film’s trailer.
The rules for eligibility in the Best Original Song category state that: “An original song consists of words and music, both of which are original and written specifically for the film.” The rules go on to state: “The work must be the result of a creative interaction between the filmmaker(s) and the composer(s) or songwriter(s) who have been engaged to work directly on the film.”