2020 Investment Climate Statements: Ireland

Policies Towards Foreign Direct Investment

The Irish government actively promotes FDI, a strategy that has fueled economic growth since the mid-1990s.  The principal goal of Ireland’s investment promotion has been employment creation, especially in technology-intensive and high-skill industries.  More recently, the government has focused on Ireland’s international competitiveness by encouraging foreign-owned companies to enhance research and development (R&D) activities and to deliver higher-value goods and services.

The Irish government’s actions have achieved considerable success in attracting U.S. investment in particular.  The stock of American FDI in Ireland stood at USD 442 billion in 2018, more than the U.S. total for China, India, Russia, Brazil, and South Africa (the so-called BRICS countries) combined.  There are approximately 700 U.S. subsidiaries currently in Ireland employing roughly 160,000 people and supporting work for another 128,000.  This figure represents a significant proportion of the 2.36 million people employed in Ireland.  U.S. firms operate primarily in the following sectors:  chemicals, bio-pharmaceuticals and medical devices, computer hardware and software, internet and digital media; electronics, and financial services.

U.S. investment has been particularly important to the growth and modernization of Irish industry over the past 25 years, providing new technology, export capabilities, management and manufacturing best practices, and employment opportunities.  The activities of U.S. firms in Ireland span from the manufacturing of high-tech electronics, computer products, medical devices, and pharmaceuticals to retailing, banking, finance, and other services.  More recently, Ireland has also become an important R&D center for U.S. firms in Europe, and a magnet for U.S. internet and digital media investment.  Industry leaders like Google, Amazon, eBay, PayPal, Facebook, Twitter, LinkedIn, Electronic Arts and cybersecurity firms like Tenable, Forcepoint, AT&T Cybersecurity, McAfee use Ireland as the hub or important part of their respective European, and sometimes Middle Eastern, African, and/or Indian operations.

U.S. companies are attracted to Ireland as an exporting sales and support platform to the EU market of almost 500 million consumers and other global markets, mainly the Middle East and Africa.  Ireland is a successful FDI destination for many reasons, including a corporate tax rate of 12.5 percent for all domestic and foreign firms; a well-educated, English-speaking workforce; the availability of a multilingual labor force; cooperative labor relations; political stability; and pro-business government policies and regulators.  Ireland also benefits from a transparent judicial system; good transportation links; proximity to the United States and Europe, and the drawing power of existing companies operating successfully in Ireland (a so-called “clustering” effect).

Conversely, factors that negatively affect Ireland’s ability to attract investment include high labor and operating costs (such as for energy); sporadic skilled-labor shortages; the fall-out from the COVID-19 pandemic; and sometimes-deficient infrastructure (such as in transportation, energy and broadband quality).  Ireland also suffers from housing and high-quality office space shortages; uncertainty in EU policies on some regulatory matters; and absolute price levels that are among the highest in Europe.  Some Irish government agencies have in the past expressed concern that energy costs and the reliability of energy supply could also undermine Ireland’s attractiveness as a FDI destination.  The American Chamber of Commerce in Ireland has called for greater attention to a “skills gap” in the supply of Irish graduates to the high technology sector.  It also has asserted that high personal income tax rates can make attracting talent from abroad difficult.

In 2013, Ireland became the first country in the Eurozone to exit a financial bailout program from the EU, European Central Bank, and International Monetary Fund (EU/ECB/IMF, or so-called Troika).  Compliance with the terms of the Troika program came at a substantial economic cost with gross domestic product (GDP) stagnation and austerity measures, while dealing with high unemployment (which hit 15 percent).  Strong economic progress followed through government-backed initiatives to attract investment and stimulate job creation and employment.  This aided economic recovery and Ireland’s economy was the one of the fastest growing economies in the Eurozone area annually to 2019.  The high unemployment levels fell dramatically and by the end of 2019 reached 4.7 percent.  In addition, the Irish government has successfully returned to international sovereign debt markets and successful treasury bonds sales, at low interest rates, exemplify renewed international confidence in Ireland’s economic progress.

Brexit and its Implications for Ireland

The UK’s exit from the EU leaves Ireland as the only remaining English-speaking country in the bloc.  Ireland is the only EU country to share a land border with the UK.  The future trading relationship between the UK and the EU will affect Ireland’s economic performance.  A significance trade risk includes the imposition of trade tariffs following the transition period due to end December 31, 2020.  Ireland will also lose a close EU ally on policy matters, particularly free trade and business friendly open markets.  Ireland is heavily dependent on the UK as an export market, especially for food products, and sectors such as food and agri-business may be hardest hit.  Ireland also sources many imports from the UK and cost rises are likely if supply chains are disrupted.  Irish trade with its EU colleagues may also be impacted as Irish trade to the EU often uses the UK as a land-bridge for trucking products.  A number of UK-based firms (including US firms) have moved headquarters or opened subsidiary offices in Ireland to facilitate ease of business with other EU countries. Initial econometric models from the Irish Department of Finance and the Central Bank of Ireland (CBI) in 2019 suggested Brexit would cut Ireland’s economic growth modestly in the near term.  Revised modelling is anticipated post COVID-19.

Industrial Promotion

Six government departments and organizations have responsibility to promote investment into Ireland by foreign companies:

• The Industrial Development Authority of Ireland (IDA Ireland) has overall responsibility for promoting and facilitating FDI in all areas of the country. IDA Ireland is also responsible for attracting foreign financial and insurance firms to Dublin’s International Financial Services Center (IFSC). IDA Ireland maintains seven U.S. offices (in New York, NY; Boston, MA; Chicago, IL; Mountain View, CA; Irvine, CA; Atlanta, GA; and Austin, TX), as well as offices throughout Europe and Asia.
• Enterprise Ireland (EI) promotes joint ventures and strategic alliances between indigenous and foreign companies. The agency assists entrepreneurs establish in Ireland and also assists foreign firms that wish to establish food and drink manufacturing operations in Ireland. EI has five existing offices in the United States (New York, NY; Austin, TX; Boston, MA; Chicago, IL; and Mountain View, CA); is planning on opening an office in Seattle, WA and has offices in Europe, South America, the Middle East, and Asia.
• Shannon Group (formerly the Shannon Free Airport Development Company) promotes FDI in the Shannon Free Zone (SFZ) and owns properties in the Shannon region as potential green-field investment sites. Since 2006, the responsibility for investment by Irish firms in the Shannon region has passed to Enterprise Ireland while IDA Ireland remains responsible for FDI in the region.
• Udaras na Gaeltachta (Udaras) has responsibility for economic development in those areas of Ireland where the predominant language is Irish, and works with IDA Ireland to promote overseas investment in these regions.
• Department of Foreign Affairs and Trade (DFAT) has responsibility for economic messaging and supporting the country’s trade promotion agenda as well as diaspora engagement to attract investment.
• Department of Business, Enterprise and Innovation (DBEI) supports the creation of jobs by promoting the development of a competitive business environment in which enterprises will operate with high standards and grow in sustainable markets.

Limits on Foreign Control and Right to Private Ownership and Establishment

Irish law allows foreign corporations (registered under the Companies Act 2014 or previous legislation and known locally as a public limited company, or plc for short) to conduct business in Ireland.  Any company incorporated abroad that establishes a branch in Ireland must file certain papers with the Registrar of Companies.  A foreign corporation with a branch in Ireland will have the same standing in Irish law for purposes of contracts, etc., as a domestic company incorporated in Ireland.  Private businesses are not competitively disadvantaged to public enterprises with respect to access to markets, credit, and other business operations.

No barriers exist to participation by foreign entities in the purchase of state-owned Irish companies.  Residents of Ireland may, however, be given priority in share allocations over all other investors.  An example of this was the 1998 sale of the state-owned telecommunications company Eircom when Irish residents received priority in share allocations.  The government privatized the national airline Aer Lingus through a stock market flotation in 2005, but chose to retain about a one-quarter stake.  At that time, U.S. investors purchased shares in the sale.  The International Airlines Group (IAG) purchased the Government’s remaining stake in the airline in 2015, and subsequently took an overall controlling interest which it continues to hold.

Citizens of countries other than Ireland and EU member states can acquire land for private residential or industrial purposes.  Under Section 45 of the Land Act, 1965, all non-EU nationals must obtain the written consent of the Land Commission before acquiring an interest in land zoned for agricultural use.  There are many equine stud farms and racing facilities owned by foreign nationals.  No restrictions exist on the acquisition of urban land.

Ireland does not yet have formal investment screening legislation but is in the process of developing it.  As an EU member, Ireland will have to implement any future common EU investment screening regulations or directives.

Other Investment Policy Reviews

The Economist Intelligence Unit and World Bank’s Doing Business 2019 provide current information on Ireland’s investment policies.

Business Facilitation

All firms must register with the Companies Registration Office (CRO online at www.cro.ie ).  The CRO, as well as registering companies, can also register a business/trading name, a non-Ireland based foreign company (external company), or a limited partnership.  Any firm or company registered under the Companies Act 2014 becomes a body corporate as and from the date mentioned in its certificate of incorporation.  The CRO website permits online data submission.  Firms must submit a signed paper copy of this online application to the CRO, unless the applicant company has already registered with www.revenue.ie (the website of Ireland’s tax collecting authority, the Office of the Revenue Commissioners).

Outward Investment

Enterprise Ireland assists Irish firms in developing partnerships with foreign firms mainly to develop and grow indigenous firms.

Ireland has signed no formal bilateral investment treaties (BITs) with other EU members or the United States.

The United States and Ireland have shared a Friendship, Commerce, and Navigation Treaty since 1950, which includes provisions common to BITs regarding national treatment, most-favored nation benefits, expropriation, and protection and security.  The full text is here:  http://tcc.export.gov/Trade_Agreements/All_Trade_Agreements/exp_005438.asp .

Since 1998, Ireland and the United States have shared a Tax Treaty, supplemented in December 2012 with an agreement to improve international tax compliance and to implement the U.S. Foreign Account Tax Compliance Act (FATCA).  See http://www.irs.gov/pub/irs-trty/ireland.pdf  for a copy of the existing treaty.

Ireland has signed comprehensive double taxation agreements (DTA) with 74 countries, 73 of which (except Ghana) are fully ratified and in effect.  Agreements with other countries are also in negotiation and DTAs are regularly updated.  These taxation agreements serve to promote trade and investment between Ireland and the partner countries that would otherwise be discouraged by the possibility of double taxation.  The agreements generally cover corporate tax, income tax, and capital gains tax (direct taxes).  The current list of agreements in effect, as of January 2020, includes the following countries:  Albania, Armenia, Australia, Austria, Bahrain, Belarus, Belgium, Bosnia & Herzegovina, Botswana, Bulgaria, Canada, Chile, China, Croatia, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Ethiopia, Finland, France, Georgia, Germany, Greece, Hong Kong, Hungary, Iceland, India, Israel, Italy, Japan, Kazakhstan, Korea (Republic of), Kuwait, Latvia, Lithuania, Luxembourg, Macedonia, Malaysia, Malta, Mexico, Moldova, Montenegro, Morocco, Netherlands, New Zealand, Norway, Pakistan, Panama, Poland, Portugal, Qatar, Romania, Russia, Saudi Arabia, Serbia, Singapore, Slovak Republic, Slovenia, South Africa, Spain, Sweden, Switzerland, Thailand, Turkey, United Arab Emirates, Ukraine, United Kingdom, United States, Uzbekistan, Vietnam, and Zambia.

In the absence of a bilateral tax treaty, provisions within the Irish Taxes Act allow unilateral credit relief against Irish taxation for taxes paid in the other country with respect to certain types of income, e.g., dividends and interest.

Transparency of the Regulatory System

Ireland’s judicial system is transparent and upholds the sanctity of contracts, as well as laws affecting foreign investment.   These laws include:

• The Companies Act 2014, which contains the basic requirements for incorporation in Ireland;
• The 2004 Finance Act, which introduced tax incentives to encourage firms to set up headquarters in Ireland and to conduct R&D;
• The Mergers, Takeovers and Monopolies Control Act of 1978, which sets out rules governing mergers and takeovers by foreign and domestic companies;
• The Competition (Amendment) Act of 1996, which amends and extends the Competition Act of 1991 and the Mergers and Takeovers (Control) Acts of 1978 and 1987, and sets out the rules governing competitive behavior; and,
• The Industrial Development Act (1993), which outlines the functions of IDA Ireland.

The Companies Act (2014), with more than 1,400 sections and 17 Schedules, is the largest-ever Irish statute.  The Act consolidated and reformed all Irish company law for the first time in over 50 years.

In addition, numerous laws and regulations pertain to employment, social security, environmental protection and taxation, with many of these keyed to EU regulations and directives.

International Regulatory Considerations

Ireland has been a member of the EU since 1973.  As a member, it incorporates all EU legislation into national legislation and applies all EU regulatory standards and rules.  Ireland is a member of the World Trade Organization (WTO) and follows all WTO procedures.

Legal System and Judicial Independence

Ireland’s legal system is common law.  Justice is administered in courts established by the law, and are presided over by judges appointed by the President of Ireland (on the advice of the government).  The Commercial Court is a designated court of the High Court which deals with commercial disagreements between businesses where the value of the claim is at least €1 ($1.1) million.  The Commercial Court also oversees cases on intellectual property rights, including trademarks and trade secrets.

Laws and Regulations on Foreign Direct Investment

Ireland treats all firms incorporated in Ireland on an equal basis.  With only a few exceptions, no constraints prevent foreign individuals or entities from ownership or participation in private firms/corporations.  The most significant of these exceptions is that, in common with other EU countries, Irish airlines must be at least 50 percent owned by EU residents to have full access to the single European aviation market.  Citizens of countries other than Ireland and EU member states can acquire land for private residential or industrial purposes.

One of Ireland’s most attractive features as an FDI destination is its low corporate tax rate.  Since 2003, the headline corporate tax rate for all firms, foreign and domestic, is 12.5 percent.  Ireland’s headline corporate tax rate is among the lowest in the EU.  The Irish government continues to claim sovereignty over setting its own taxation system and strongly opposes any EU proposals to harmonize corporate taxes at a common EU rate.  In 2014, the government announced firms would no longer be able to incorporate in Ireland without also being tax resident.  Firms could, prior to this change, incorporate in Ireland and be tax resident elsewhere, making use of a tax avoidance arrangement colloquially known as the “Double Irish” to reduce tax liabilities.

The Irish government has indicated it will adhere to future decisions reached through the OECD’s Base Erosion and Profit Sharing (BEPS) discussions and has already incorporated a number of BEPS recommendations including Ireland’s ratification of the BEPS Multilateral Instrument in January 2019.  The government implemented a Knowledge Development Box (KDB), effective 2016, which is consistent with OECD guidelines.  The KDB allows for the application of a tax rate of 6.25 percent on profits arising to certain intellectual property assets that are the result of qualifying research and development activities carried out in Ireland.

Competition and Anti-Trust Laws

The Competition and Consumer Protection Commission (CCPC) is an independent statutory body with a dual mandate to enforce competition and consumer protection law in Ireland.  Ireland established the CCPC on October 2014, after the amalgamation of the National Consumer Agency and the Competition Authority.  The CPCC enforces Irish and EU competition law in Ireland.  It has the power to conduct investigations and can take civil or criminal enforcement action if it finds evidence of breaches of competition law.

The Competition Act of 2002, subsequently amended and extended by the Competition Act 2006, mandates the enforcement power of the CCPC.  The Act introduced criminal liability for anti-competitive practices, increased corporate liability for violations, and outlined available defenses.  Most tax, labor, environment, health and safety, and other laws are compatible with EU regulations, and they do not adversely affect investment.  The government publishes proposed drafts of laws and regulations to solicit public comment, including those by foreign firms and their representative trade associations.  Bureaucratic procedures are transparent and reasonably efficient, in line with a general pro-business climate espoused by the government.

The Irish Takeover Panel Act of 1997 governs company takeovers.  Under the Act, the Takeover Panel issues guidelines, or Takeover Rules, which regulate commercial behavior in mergers and acquisitions.  According to minority squeeze-out provisions in the legislation, a bidder who holds 80 percent of the shares of the target firm (or 90 percent for firms with securities on a regulated market) can compel the remaining minority shareholders to sell their shares.  There are no reports that the Irish Takeover Panel Act has prevented foreign takeovers, and, in fact, there have been several high-profile foreign takeovers of Irish companies in the banking and telecommunications sectors in the past.  Babcock & Brown (an Australian investment firm) acquired the former national telephone company, Eircom in 2006 which it subsequently sold to Singapore Technologies Telemedia in 2009.  The EU Directive on Takeovers provides a framework of common principles for cross-border takeover bids, creates a level playing field for shareholders, and establishes disclosure obligations throughout the EU.  Irish legislation fully implemented the Directive in 2006, though the Irish Takeover Panel Act 1997 had already incorporated many of its principles.

Companies must notify the CCPC of mergers over a certain financial threshold for review as required by the Competition Act 2002, as amended (Competition Act).

Expropriation and Compensation

The government normally expropriates private property only for public purposes in a non-discriminatory manner and in accordance with established principles of international law.  The government condemns private property in accordance with recognized principles of due process.

The Irish courts provide a system of judicial review and appeal where there are disputes brought by owners of private property subject to a government action.

Dispute Settlement

There is no specific domestic body for handling investment disputes.  The Irish Constitution, legislation, and common law form the basis for the Irish legal system.  DBEI has primary responsibility for drafting and enforcing company law.  The judiciary is independent, and litigants are entitled to trial by jury in commercial disputes.

ICSID Convention and New York Convention

Ireland is a member of the International Center for the Settlement of Investment Disputes (ICSID) and a party to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, meaning local courts must enforce international arbitration awards under appropriate circumstances.

Some U.S. business representatives have occasionally called into question the transparency of Irish government tenders.  According to some U.S. firms, lengthy procedural decisions often delay the procurement tender process.  Unsuccessful bidders have claimed they have had difficulty receiving information on the rationale behind the tender outcome.  In addition, some successful bidders have experienced delays in finalizing contracts, commencing work on major projects, obtaining accurate project data, and receiving compensation for work completed, including through conciliation and arbitration processes.  Some successful bidders have also subsequently found that the original tenders may not have accurately described conditions on the ground.

Bankruptcy Regulations

The Companies Act 2014 is the most important body of law dealing with commercial and bankruptcy law, which Irish courts consistently apply.  Irish company bankruptcy legislation gives creditors a strong degree of protection.

Investment Incentives

Three Irish organizations – IDA Ireland, EI, and Udaras – have regulatory authority for administering grant aid to investors for capital equipment, land, buildings, training, and R&D.  Foreign and domestic business enterprises that seek grant aid from these organizations must submit detailed investment proposals.  These proposals typically include information on fixed assets (capital), labor, and technology/R&D components, and establish targets using criteria such as sales, profitability, exports, and employment.  The submitted information is kept confidential, and each investment proposal is subject to an economic appraisal before support is offered or denied.

Ireland’s investment agencies and foreign investors jointly establish employment creation targets, which usually serve as the basis for performance requirements.  The agencies will only pay grant aid after the foreign investors have attained externally audited performance targets.  Grant aid agreements generally have a repayment term of five years after the date on which the last installment is paid.  Parent companies of the investor generally must also guarantee repayment of the government grant if the grant-aided company closes before an agreed period of time elapses, normally ten years after the grant was paid.  There are no requirements foreign investors must procure locally, or allow nationals to own shares.

The current EU Regional Aid Guidelines (RAGs) that apply to Ireland operate through 2020.  The RAGs govern the maximum grant aid the Irish government can provide to firms/businesses, which are graded based on their location.  The differences in the various aid ceilings reflect the less developed status of business/infrastructure in regions outside the greater Dublin area.

While investors are free, subject to planning permission, to choose the location of their investment, IDA Ireland has actively encouraged investment in regions outside Dublin since the 1990s.  Investment regionalization became Irish government policy in 2001, officially seeking to spread investment more evenly around the country.  The IDA Ireland’s strategy targets locating over 50 percent of all new FDI investments outside the two main urban centers of Dublin and Cork.  In an effort to encourage the location of firms outside Dublin, IDA Ireland has developed “magnets of attraction”, providing cluster areas of activity around the country and supported construction of business parks in counties Galway and Louth, especially for the biotechnology sector.

There are no restrictions, de jure or de facto, on participation by foreign firms in government-financed and/or -subsidized R&D programs on a national basis.  In fact, the government strongly encourages and incentivizes (via a partial tax break) foreign companies to conduct R&D as part of its national strategy to build a more knowledge-intensive, innovation-based economy.  Science Foundation Ireland (SFI), the state science agency, has been responsible for administering Ireland’s R&D funding since 2000.  Under its current strategy, SFI is investing over USD 200 million annually in R&D activities.  SFI is targeting leading researchers in Ireland and overseas to promote the development of biotechnology, information and communications technology; and energy.  SFI has specific research centers of excellence, hubs that draw researchers from Ireland’s universities for research on specific themes.

The U.S.-Ireland Research and Development Partnership (UIRDP), launched in 2006, is a unique initiative involving funding agencies across three jurisdictions: the United States, Ireland, and Northern Ireland (NI).  Under the program, a ‘single-proposal, single-review’ mechanism is facilitated by the National Science Foundation  and National Institutes of Health in the United States, which accept submissions from tri-jurisdictional (U.S., Ireland, and NI) teams for existing funding programs.  All proposals submitted under the auspices of UIRDP must have significant research involvement from researchers in all three jurisdictions.  In 2015, the UIRDP program topics expanded to include agricultural research; and in 2019 cybersecurity was also incorporated as a topic.

A key aspect of government support is a tax credit on the cost of eligible research, development, and innovation (RDI) activity; and on buildings used for RDI activity.  A tax credit of 25 percent is subject to certain conditions and is available for R&D activities carried out in a wide variety of science and technology areas such as software development, engineering, food and beverage production, medical devices, pharmaceuticals, financial services, agriculture and horticulture.  A number of U.S. firms have already used these tax credits to build and operate R&D facilities.  The Irish government’s Knowledge Development Box (KDB), introduced in 2016, also offers a lower tax rate for certain R&D activities carried out in Ireland.

Foreign Trade Zones/Free Ports/Trade Facilitation

The government established Shannon duty-free Processing Zone under legislation in 1957.  Back then, firms operating in the area were entitled to a number of taxation and duty-free benefits not available elsewhere in Ireland.  Nowadays, all firms in Ireland are now treated equally and the Shannon Free Zone (SFZ) as it is now called, continues to operate albeit without any additional taxation benefits.

All firms operating in the SFZ area have the same investment opportunities and tax incentives as indigenous Irish companies.  More than 150 companies operate within the 254-hectare business park.  The following U.S. companies are located in SFZ:  Benex (Becton Dickinson), Connor-Winfield, Digital River, Enterasys Networks, Extrude Hone, GE Capital Aviation Services, GE Money, Sensing, Genworth Financial, Intel, Illinois Tool Works, Kwik-Lok, Lawrence Laboratories (Bristol Myers Squibb), Le Bas International, Magellan Aviation Services, Maidenform, Melcut Cutting Tools (SGS Carbide Tools), Mentor Graphics, Molex, Phoenix American Financial Services, RSA Security, Shannon Engine Support (CFM International), SPS International/Hi-Life Tools (Precision Castparts Corp), Sykes Enterprises, Symantec, Travelsavers Corp, Viking Pump, Western Well Tool, Xerox, and Zimmer.

The Shannon Group currently operates the SFZ, as well as Shannon Airport.

Performance and Data Localization Requirements

Visa, residence, and work permit procedures for foreign investors are non-discriminatory and, for U.S. citizens (as investors or employees), generally liberal.  No restrictions exist on the numbers of, and duration of employment for, foreign managers brought in to supervise foreign investment projects, though all work permits must be renewed annually.  There are no discriminatory export policies or import policies affecting foreign investors.

Data Storage

The government does not follow forced localization nor does it require foreign information technology providers to turn over source code and/or provide access to surveillance (e.g., backdoors into hardware and software, or encryption keys).  There are no rules on maintaining minimum amounts of data storage in Ireland.  Many U.S. firms already operate data centers in Ireland.

Real Property

The government recognizes and enforces secured interests in property, both chattel and real estate.  The Department of Justice and Equality administers a reliable system of recording such security interests through the Property Registration Authority (PRA) and Registry of Deeds.  The PRA registers a person’s interest in property on a public register. All property buyers must since 2010 register their acquisition with the PRA.  Ireland also operates a document registration system through the Registry of Deeds in which deeds (as distinct from titles) may be registered, priority obtained, and third parties placed on notice of the existence of documents of title.  An efficient, non-discriminatory legal system is accessible to foreign investors to protect and facilitate acquisition and disposition of all property rights.

Intellectual Property Rights

Ireland is a member of the World Intellectual Property Organization (WIPO) and party to many of its treaties, including the Berne Convention, the Paris Convention, the Patent Cooperation Treaty, the WIPO Copyright Treaty, and the WIPO Performances and Phonograms Treaty .  Legislation enacted in 2000 brought Irish intellectual property rights (IPR) law into compliance with Ireland’s obligations under the WTO Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement.  The legislation gave Ireland one of the most comprehensive legal frameworks for IPR protection in Europe.  It also addressed several TRIPs inconsistencies in prior Irish copyright law that had concerned foreign investors, including the absence of a rental right for sound recordings, the lack of an anti-bootlegging provision, and low criminal penalties that failed to deter piracy.  The legislation provides for stronger penalties on both the civil and criminal sides, but it does not include minimum mandatory sentencing for IPR violations.  As part of this comprehensive legislation, revisions were also made to non-TRIPS conforming sections of Irish patent law.  Specifically, the IPR legislation addressed two outstanding concerns of many foreign investors in the previous legislation:

– The compulsory licensing provisions of the previous 1992 Patent Law were inconsistent with the “working” requirement prohibition of TRIPs Articles 27.1 and the general compulsory licensing provisions of Article 31; and,

– Applications processed after December 20, 1991 did not previously conform to the non-discrimination requirement of TRIPs Article 27.1.

The government continues to crack down on the sale of illegal cigarettes smuggled into the country by international and local organized criminal groups.  High taxation on tobacco products makes illegal trade in counterfeit and untaxed cigarettes highly lucrative.  Ireland became the first European country, and fourth globally, to enact legislation on plain packaging for tobacco products via The Public Health (Standardized Packaging of Tobacco) Act in 2015.  In practice, all tobacco packaging is devoid of branding, and health warnings cover nearly the entire box with only the producer/product name otherwise visible.  The legislation has been in force since September 2018.

The Irish government has transcribed the 2012 EU Copyright and Related Rights Regulations into law.  This legislation makes it possible for copyright holders to seek court injunctions against firms, such as internet service providers (ISPs) or social networks, whose systems host copyright-infringing material.  Irish courts ensure any remedy provided will uphold the freedom of ISPs to conduct their business.  The legislation ensures that the government cannot mandate any ISP to carry out monitoring of information.  The legislation also ensures that measures implemented are “fair and proportionate” and not “unnecessarily complicated or costly.”  The law also states that the Courts must respect the fundamental rights of ISP customers, including the customers’ right to protection of personal data and the freedom to receive or impart information.

The government enacted the Copyright and Other Intellectual Property Law Provisions Act in 2019.  The legislation improves provision for copyright and other IPR protection in the digital era, and its enables rights holders to better enforce their IPR in the courts.

Ireland is not included on the U.S. Trade Representative (USTR) Special 301 Report or the Notorious Markets List.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

Capital Markets and Portfolio Investment

Capital markets and portfolio investments operate freely with no discrimination between Irish and foreign firms.  In some instances, development authorities and commercial banks facilitate loan packages to foreign firms with favorable credit terms.  All loans are offered on market terms.  There was limited credit available, especially to small and medium-sized enterprises (SMEs), after the financial crisis of 2008.  Bank balance sheets have since improved with lending levels increasing as the health of the economy improved.  The government established the Strategic Banking Corporation of Ireland (SBCI) to ensure SMEs had access to credit available at market terms.  Irish legal, regulatory, and accounting systems are transparent and consistent with international norms and provide a secure environment for portfolio investment.  The current capital gains tax rate is 33 percent (since December 2012).

Euronext, an EU-based grouping of stock exchange operators in 2018 acquired and operates the Irish Stock Exchange (ISE), now known as Euronext Dublin.

Money and Banking System

The Irish banking sector, like many worldwide, came under intense pressure in 2007 and 2008 following the collapse of Ireland’s construction industry and the end of Ireland’s property boom.  A number of Ireland’s financial lenders were severely under-capitalized and required government bailouts to survive. The government fearing a flight of private investments, introduced temporary guarantees (still in operation) to personal depositors in 2008 to ensure that deposits remained in Ireland.  Anglo Irish Bank (Anglo), a bank heavily involved in construction and property lending, failed and was resolved by the government.  The government then took majority stakes in several other lenders, effectively nationalized two banks and acquired a significant proportion of a third.  The National Asset Management Agency (NAMA), established in 2009, acquired most of the property-related loan books of the Irish banks (including Anglo) at a fraction of their book value.

The government (with its increased exposure to bank debts) and a rising budget deficit had difficulty in placing sovereign debt on international bond markets following the economic crash of 2008.  By November 2010 it had to seek assistance from the Troika (International Monetary Fund (IMF), EU and European Central Bank (ECB)).  The Troika and Irish government agreed a rescue package of EUR 85 ($110) billion with EUR 67.5 ($88) billion of this provided by the Troika, to cover government deficits and costs related to the bank recapitalizations.  The government took effective control of Allied Irish Bank (AIB), following a further recapitalization by the end of 2010.  The government subsequently took into state control, and then resolved, two building societies, Irish Nationwide Building Society and Educational Building Society.  The government also helped to re-capitalize Irish Life and Permanent (the banking portion of which was spun off and now operates under the name Permanent TSB) and the Bank of Ireland (BOI).  The government, in line with Troika bailout program recommendations, forced Irish banks to deleverage their non-core assets to limit Ireland’s banks to effectively service domestic banking demand.  BOI succeeded in remaining non-nationalized by realizing capital from the sale of non-essential portfolios as well as by some targeted burden sharing with some of its bondholders.  The government sold just over 28 percent of its shareholding in AIB Bank in July 2017, but it still retains the remainder of the shareholding.

Ireland exited the Troika program in 2013 and shortly thereafter re-entered sovereign debt markets.  International financing rates continued to fall to record lows for Irish debt, and Ireland fully repaid IMF loans by bond sales secured at better less expensive rates.  Ireland also paid off some bilateral loans extended to it by Denmark and Sweden ahead of schedule in 2017, by securing funding from international markets at lower rates.

Ireland’s retail banking sector is now healthy and well capitalized in line with ECB rules on bank capitalizations.  The stock of non-performing loans on bank balance sheets remains high; and banks continue to divest themselves of these loans through bundle sales to investors.

The Central Bank of Ireland (CBI) is responsible for both central banking and financial regulation.  The CBI is a member of the European System of Central Banks (ESCB), whose primary objective is to maintain price stability in the euro area.

There are a large number of U.S. banks with operations in Ireland, many of whom are located in Dublin’s International Financial Services Center (IFSC) Dublin.  The IFSC originally functioned somewhat like a business park for financial services firms who located there to take advantage of tax breaks.  Financial firms, irrespective of their location in Ireland, are now treated equally like all firms for taxation.  U.S. banks located in Ireland provide a range of financial services to clients in Europe and worldwide.  Among these firms are State Street, Citigroup, Merrill Lynch, Wells Fargo, JP Morgan, and Northern Trust.  The regulation of the international banks operating throughout Ireland falls under the jurisdiction of the CBI.

Ireland is part of the Eurozone, and therefore does not have an independent monetary policy.  The ECB formulates and implements monetary policy for the Eurozone; the CBI implements that policy at the national level.  The Governor of the CBI is a member of the ECB’s Governing Council and has an equal say as other ECB governors in the formulation of Eurozone monetary and interest rate policy.  The CBI also issues euro currency in Ireland, acts as manager of the official external reserves of gold and foreign currency, conducts research and analysis on economic and financial matters, oversees the domestic payment and settlement systems, and manages investment assets on behalf of the State.

Foreign Exchange and Remittances

Foreign Exchange

Ireland uses the euro as its national currency and enjoys full current and capital account liberalization.  Foreign exchange is easily available at market rates.  Ireland is a member of the Financial Action Task Force (FATF).

Remittance Policies

There are no restrictions or significant reported delays in the conversion or repatriation of investment capital, earnings, interest, or royalties, nor are there any announced plans to change remittance policies.  Likewise, there are no limitations on the import of capital into Ireland.

Sovereign Wealth Funds

The National Treasury Management Agency (NTMA) is the asset management bureau of the government.  Day-to-day funding for government operations is normally through the sale of sovereign debt worldwide, which is the responsibility of the NTMA.  The NTMA is also responsible for investing Irish government funds, such as the national pension funds, in financial instruments worldwide.  Ireland suspended issuing sovereign debt upon entering the Troika bailout program in 2010 but has been successfully placing Irish debt since Ireland’s 2013 exit from the Troika program,

The NTMA also has oversight of the National Asset Management Agency (NAMA), the agency established to take on, and dispose of, the property-related loan books of Ireland’s bailed-out banks.

The government created the Ireland Strategic Investment Fund (ISIF) in 2014 with a statutory mandate to invest on a commercial basis to support economic activity and employment in Ireland.  The dual objective mandate of the ISIF – investment return and economic impact –requires all of its investments to generate returns as well as having a positive (i.e. job-creating) economic impact in Ireland.  The ISIF assisted a number of small and medium sized enterprises during Ireland’s economic revival.

There are a number of SOEs in Ireland in the energy, broadcasting, and transportation sectors.  Eirgrid is the SOE with responsibility of managing and operating the electricity grid on the island of Ireland.  (Eirgrid has a sister company SONI in Northern Ireland).  There are two energy SOEs – Electric Ireland (for electricity) and Ervia, formerly Bord Gáis Eireann, (for natural gas).  Raidió Teilifís Éireann (RTE) operates the national broadcasting (radio and television) service while Córas Iompair Éireann (CIE) provides bus and train transportation throughout the country.  The government privatized both Eircom (the national telecommunication service) and Aer Lingus (the national airline).  CIE