Doing business in Ireland

A Q&A guide to doing business in Ireland.

This Q&A gives an overview of key recent developments affecting doing business in Ireland as well as an introduction to the legal system; foreign investment, including restrictions, currency regulations and incentives; and business vehicles and their relevant restrictions and liabilities. The article also summarises the laws regulating employment relationships, including redundancies and mass layoffs, and provides short overviews on competition law; data protection; and product liability and safety. In addition, there are comprehensive summaries on taxation and tax residency; and intellectual property rights over patents, trade marks, registered and unregistered designs.

This article is part of the multi-jurisdictional guide to doing business worldwide. For a full list of contents, please visit

John Matson, Arthur Cox (Lex Mundi Member Firm)


1. What are the key recent developments affecting doing business in your jurisdiction?

Ireland's most recent budget affirmed Ireland's commitment to maintaining the 12.5% headline rate of corporation tax.

Ireland operates a refundable 25% research and development (R&D) tax credit for relevant expenditure which can provide an overall effective corporation tax reduction of 37.5% and tax relief for R&D employees. The amount of expenditure that is eligible for the R&D tax credit has been increased from EUR200,000 to EUR300,000.

Ireland has a programme of relief for certain employees of overseas companies posted to work in Ireland which allows a relevant amount of their taxable income in Ireland to be excluded from tax. The programme is designed to enable multi-national companies to attract key talent to Ireland from abroad.

The Irish government recently published a new Companies Bill which will, when enacted, consolidate the existing Companies Acts 1963 to 2012 into one piece of legislation and will introduce significant reforms in a number of areas. The Bill will provide a new company law code to the users of Irish company law.

The Irish government recently published the Competition and Consumer Protection Bill 2014 which will, when enacted, dissolve the National Consumer Association and the Competition Authority, and transfer their functions to a newly established Competition and Consumer Protection Commission.


Legal system

2. What is the legal system based on (for example, civil law, common law or a mixture of both)?

Ireland has a common law legal system.


Foreign investment

3. Are there any restrictions on foreign investment (including authorisations required by central or local government)?

The government encourages foreign investments and the tax regime is particularly favourable. Authorisations from regulatory bodies are required in certain sectors (including banking, financial services and telecommunications).

4. Are there any restrictions on doing business with certain countries or jurisdictions?

As Ireland is a member of the European Union there are generally no restrictions on trade or free competition between it and the other member states. However, doing business in non-EU countries may be subject to certain restrictions and may require additional authorisations and licences.

The EU implements sanctions, also known as "restrictive measures", autonomously at an EU level, or as a result of binding resolutions of the Security Council of the United Nations. Ireland adheres to the list of sanctioned individuals and entities prescribed by the EU. Restrictive measures imposed by the EU may target governments of third countries, or non-state entities and individuals (such as terrorist groups and terrorists).

The Minister for Finance makes Regulations under domestic legislation (such as the European Communities Act 1972, the Financial Transfers Act 1992 and the Criminal Justice (Terrorist Offences) Act 2005), to give effect to the various EU Regulations relating to restrictive measures or financial sanction.

A list of the orders currently in force can be viewed on the Department of Finance website at:

5. Are there any exchange control or currency regulations?

There is no exchange control. However, the Minister for Finance can restrict financial transfers between Ireland and other countries, provided the restriction conforms with EU law (see Question 4).

6. What grants or incentives are available to investors?

There are several government agencies responsible for promoting investment. Various grants and investment incentives are available from these agencies, depending on the nature, size and location of the proposed investment.


Business vehicles

7. What are the most common forms of business vehicle used in your jurisdiction?


Companies are the business vehicle most commonly used by foreign investors. These include:

  • Private limited companies.

  • Public limited companies.

  • Companies limited by guarantee (with share capital, deemed private and without share capital, deemed public).

  • Unlimited companies.

  • Societas Europaea (deemed public companies).

The primary advantages of companies include:

  • Limited liability for members (except for an unlimited company).

  • Separate legal personality to members.

  • The ability to benefit from tax advantages including corporate tax rate.

  • The ability to raise finance on foot of security.

  • The ability to have multiple members (99 for private companies, unlimited for public companies).

  • The ease of transfer of an interest in the business.

  • The ability to clearly define the management structure.

  • Perpetual succession.

However, the disadvantages of a company include:

  • The requirement to deliver particulars of a large number of events to the Companies Registration Office (CRO) for filing on the public register.

  • The requirement to file financial statements (except for a certain type of unlimited company).

  • The requirement to have financial statements audited (except for certain private companies).


Another form of business vehicle encountered in Ireland is the partnership model which is the default method of carrying on business between two or more persons (including corporate entities). A partnership can exist without formal registration and partners have unlimited liability. Limited partnerships are also permitted in Ireland. In this case, a distinction is drawn between general partners who manage the firm’s business and have unlimited liability, and limited partners who invest fixed amounts of money in the partnership and are liable for its debts and obligations up to the amount of their capital investments. It is possible for a limited liability company to be the general partner.

The primary advantages of a partnership are that they:

  • Are transparent from an accounting and taxation perspective.

  • May tailor their management and governance structure to suit their needs.

  • Are not subject to Irish company law.

The main disadvantages are that:

  • They do not have separate legal personality from the partners that comprise them (except in the case of limited liability partnerships where all partners will have unlimited liability).

  • Succession of ownership is not as straightforward as in a company.

Most commonly used vehicle

The most common form of business vehicle used by foreign companies is a private limited liability company. Foreign investors intending to carry on business in Ireland most frequently look to form a private company limited by shares rather than a public company. This is because fewer obligations apply to a private company and the restrictions applicable to a private company do not concern a foreign investor, who generally would not intend that the Irish company would have a large number of shareholders.

8. In relation to the most common form of corporate business vehicle used by foreign companies in your jurisdiction, what are the main registration and reporting requirements?

Registration formalities

For a private limited liability company to obtain a certificate of incorporation from the CRO, it must:

  • Pay a fee of EUR100 or EUR50 if the CRODisk scheme (an electronic incorporation scheme) is used to incorporate the company.

  • File the company's memorandum and articles of association (articles).

  • File Form A1 which contains details of:

    • the company's name;

    • its registered office;

    • its principal activity;

    • the directors and secretary;

    • subscribers and their shares.

A private company can be incorporated within ten working days under the Fé Phráinn system (a quick incorporation scheme), provided the memorandum and articles are in a form approved by the CRO. It takes three to four weeks to incorporate any other type of company.

A private company can be incorporated within five working days under the CRODisk, but is only open to members of the Fé Phrainn scheme. The memorandum and articles must also be in a form approved by the CRO.

Reporting requirements

Periodical reporting. Private companies must provide the CRO with an annual return appending the last filed audited accounts and providing details of the company's officers, members, and share capital as at the date the return is made up to.

Ongoing reporting. Private companies must inform the CRO of certain matters within a specified timeframe of their occurrence including:

  • Updates to the memorandum and articles.

  • Changes of registered office.

  • Changes in the directors and secretary.

  • Details of allotments of shares.

  • Details of any changes to their share capital.

Share capital. There is no upper limit on the share capital which a company may be authorised to issue, nor is there any restriction on the currency or denomination amount of shares. The amount of the authorised share capital and the currency and denomination of shares must be stated in the company's memorandum and articles, but can be amended (as long as this does not result in a reduction in issued share capital) by a resolution of the members. There is no minimum share capital amount that a private company must issue. However, a public limited company must have a minimum issued share capital of EUR38,092.14 if it intends to trade.

Non-cash consideration. Companies can issue shares for non-cash consideration. There are different types of non-cash consideration that are acceptable under Irish law. For example, shares can be issued in exchange for the issue of shares in another company, the transfer of an asset or the transfer of a business.

The contract itself or particulars of the contract (outlined on a specific CRO Form) evidencing the title to the shares must be filed in the CRO within one month of allotment. A stamp certificate issued by the Revenue Commissioners must be submitted to the CRO with the CRO Form or the contract itself. The CRO Form must contain the following details:

  • The number of shares being issued.

  • The nominal value of each share.

  • The amount to be considered as paid up on the shares.

  • Details of the consideration.

The general principles of contract law apply. The court will not look into the adequacy of consideration and past consideration is not sufficient consideration. There are more restrictive rules in place in respect of public limited companies and they are prohibited from accepting certain forms of non-cash consideration such as:

  • Undertakings to perform work/services.

  • Undertakings to be performed more than five years from the date of allotment of the shares.

In respect of public limited companies, there is a requirement to obtain an independent expert valuation of the consideration six months before the allotment of the shares and a copy of the expert report must be sent to the proposed allottee and the CRO. There are a number of exemptions from the requirement to obtain an expert report, for example, takeovers/restructurings.

Rights attaching to shares. The articles can provide for different classes of shares and attach differing rights (for example, regarding voting and dividend) to those different classes.

Shareholders have pre-emptive rights in the case of issuances of new shares for cash, but this is usually disapplied for five years in the articles and for each subsequent five years by shareholder vote. There is no pre-emptive right in the case of issuances for non-cash consideration. Shareholders also have the ability to control the buy-back and reissue of shares by a company.

Shareholders can convene shareholder meetings for the purpose of proposing resolutions which can direct the board to undertake certain actions. In the case of companies listed on the main market of the Irish Stock Exchange, it is possible for a shareholder or a group of shareholders holding at least 5% of the issued share capital of the company to convene such meetings. For other companies, the threshold is 10% of the issued share capital.

The ability of shareholders to direct the board to undertake certain actions is limited to the extent that the matter is already reserved for the exclusive determination of the board under the articles. Where this is the case, the shareholders cannot direct the board unless they first amend the relevant provision in the articles. The recent changes in the Corporate Governance Code has increased the influence of shareholders in that most Irish companies will hold an advisory "say-on-pay" vote at their annual general meeting, as well as seeking the re-election of all directors.

9. In relation to the most common form of corporate business vehicle used by foreign companies in your jurisdiction, outline the management structure and key liability issues.

Management structure

Private limited liability companies must have one secretary and a minimum of two directors. The secretary can be one of the directors. A corporate body cannot act as a director. At least one director of the company must be resident in a member state of the European Economic Area (EEA), unless the company places a bond to the value of EUR25,394.76 as security for compliance with company and tax law.

Management restrictions

There are no restrictions on foreign managers or directors, provided they are legally working in Ireland (see Question 12).

Directors' and officers' liability

A director can be liable for the acts of the company. Directors must:

  • Act in good faith.

  • Act in the company’s best interests.

  • Carry out their functions with due care, skill and diligence.

A director can also be liable in tort for negligent behaviour.

Directors can potentially be criminally liable for contravening the company's obligations in respect of transactions with directors and for failure to disclose related party transactions in the company accounts.

Directors can also be held criminally liable for certain crimes, including fraud and breach of environmental laws and health and safety legislation.

Parent company liability

Parent companies are not, in general, liable for acts of subsidiaries because each company is a completely separate entity (unless, for example, a parent company guarantees a loan or the subsidiary has unlimited liability).



Laws, contracts and permits

10. What are the main laws regulating employment relationships?

Employment protection laws in Ireland apply to all employees working in Ireland, irrespective of the employee's nationality. Whether these laws apply to Irish employees working abroad depends on the:

  • Employment contract.

  • Nature of the employee’s posting abroad.

If the contract does not specify the governing law and jurisdiction, the usual European conventions apply, and the deciding issue is where the employee habitually carries out his duties. The exclusion of mandatory employee protection laws through a choice of law clause which operates to the detriment of the employee is not permitted.

Employment law is primarily governed by:

  • The Constitution of Ireland 1937.

  • Irish statutes and EU law.

  • Judicial Precedents.

  • Common law (including contract law).

  • Statutory mechanisms put in place by the state to regulate certain sectors, including:

    • Registered Employment Agreements (REAs), which are confirmed by Ministerial Order;

    • health and safety;

    • redundancy payments;

    • transfers of undertakings;

    • collective bargaining agreements;

    • custom and practice in the workplace and workplace or industry rules.

The primary legislation regulating employment relationships include the:

  • Unfair Dismissals Acts 1977 to 2007.

  • Employment Equality Acts 1998 to 2011.

  • National Minimum Wage Act 2000 and the Payment of Wages Act 1991.

  • Terms of Employment (Information) Acts 1994 to 2001.

  • Maternity Protection Acts 1994 to 2004 and other protective leave legislation.

  • Minimum Notice and Terms of Employment Acts 1973 to 2005.

  • Fixed Term Workers, Part Time Employees and Agency Workers Protection Legislation.

  • Organisation of Working Time Act 1997.

11. Is a written contract of employment required? If so, what main terms must be included in it? Do any implied terms and/or collective agreements apply to the employment relationship?

Employers must provide employees with a written statement of certain terms and conditions of employment within two months of starting employment. The minimum mandatory requirements are set out in the Terms of Employment (Information) Acts 1994 and 2001.

Many employers choose to put a detailed written contract of employment in place. An employment contract includes both its express written terms and implied terms. Terms are implied by:

  • Statute.

  • Common Law, for example, the employer's duty of care and the employee's duty of fidelity.

  • Custom and practice in the workplace or industry, for example, sick pay and overtime procedures.

The employee and employer can agree terms and conditions individually or through collective bargaining.

12. Do foreign employees require work permits and/or residency permits?


Nationals from non-exempt countries must obtain an entry visa before travelling to Ireland. Details of exempt and non-exempt countries can be obtained from the Department of Foreign Affairs ( Possession of a valid visa is essential for visa-required nationals, but it simply allows you to present to an immigration office at the point of entry. An entry visa does not confer an automatic right to entry (which is subject to the immigration officer) or a right to work as there is a separate process for employment permits. Similarly, the grant of an employment permit does not grant any entry or residency rights, and visa-required nationals must still comply with visa and residency requirements after obtaining an employment permit.

Employment permits

Employment permits are required by all non-EEA/Swiss nationals (except for certain individuals, such as non-EEA spouses of EU citizens, for whom a separate process applies).

The Employment Permits Acts 2003 and 2006 establish a statutory regime governing employment permits which is operated by the Department of Jobs, Enterprise and Innovation ( There are three primary types of permit, that is, green cards, work permits and intra company transfer permits.

The Employment Permits Bill 2014 aims to update and improve the current employment permits regime once enacted.

Green cards

Applications for green cards can be made for two categories of occupation, based on salary level:

  • Where the annual salary (excluding bonuses) on offer is EUR60,000 or more, the green card permit is available for all occupations, other than those which are contrary to the public interest.

  • Green card permits are available in the annual salary range EUR30,000 to EUR59,999 (excluding bonuses) for a restricted number of strategically important occupations which are subject to updating and change.

Holders of a green card are entitled to immediate family re-unification rights which means that their spouses/partners and dependent children (if any) may accompany them to Ireland on the basis of the green card permission.

A green card is valid for a two year period after which the employee may apply for residency permission in Ireland which will allow them to live and work in Ireland without requiring an employment permit.

Work permits

These are available for occupations with a salary of EUR30,000 or more (or in exceptional cases, below EUR30,000). Work permits are issued for an initial period of two years and can then be renewed for a further three years. Work permit holders are not entitled to immediate family re-unification and must be working in Ireland for at least 12 months before an application may be made for immediate family to join. This application is entirely at the discretion of the Irish immigration authorities. After five years, the employee may apply for permission to reside in Ireland and to work without the need for an employment permit.

Intra-company transfer permits

These permits allow for the transfer of senior management, key personnel or trainees who are foreign nationals from an overseas branch of a multi-national corporation to its Irish branch subject to the following conditions:

  • The employee earns a minimum salary of EUR40,000.

  • The employee worked for a minimum period of six months with the overseas company prior to transfer.

  • The Intra Company Transfer permit is strictly for assignments of a temporary nature and therefore, the maximum permissible duration is five years. After this time, the holder must return to their home country.

The processing times, criteria, requirements and benefits of each permit type vary. The fees for permits depend on the:

  • Type of permit sought.

  • Length of the permit.

Fees typically range from EUR500 to EUR2,250.

For all employment permits applications (excluding the Intra-Company Transfer Permit), the employer must establish that it is not possible to fill the position with an Irish or other EEA national. The labour market needs tests apply in respect of the work permit only (that is, public advertising of the role within the EU for a specified period before considering a non-EEA/Swiss national for a permit).

Termination and redundancy

13. Are employees entitled to management representation and/or to be consulted in relation to corporate transactions (such as redundancies and disposals)?

Employees are not entitled to management representation or consultation rights except as follows:

  • In an undertaking employing 50 employees or more, employees are entitled to establish an information and consultation forum. Establishing a forum is not mandatory unless certain criteria are met in accordance with the Employees (Provision of Information and Consultation) Act 2006.

  • Employees must be consulted on collective redundancies (Protection of Employment Act 1977). Whether collective redundancies arise depends on the number of proposed redundancies by reference to the size of the workforce of the organisation.

  • Employees must be informed of certain matters under the European Communities (Protection of Employees on a Transfer of Undertakings) Regulations 2003 and consultation must take place where measures are envisaged as part of that process.

  • Where it has been agreed between the parties to consult on certain matters.

14. How is the termination of individual employment contracts regulated?

Under unfair dismissal legislation, all dismissals are automatically deemed unfair and it is for the employer to justify the substantial grounds for its decision to dismiss (except in constructive unfair dismissal cases where the burden of proof is reversed and the employee must justify his decision to resign).

The unfair dismissal legislation generally applies to all employees who have completed one year's continuous service (including any notice entitlement). However, if the employee claims unfair dismissal on certain grounds (such as trade union membership or activities, pregnancy or denial of entitlements under maternity legislation), the requirement of one year's service is waived.

Acceptable grounds for dismissal are those relating to the employee's:

  • Capability.

  • Competence.

  • Qualifications.

  • Conduct.

  • Contravention of statute.

  • Redundancy.

However, a catch-all provision also allows for employers to advance other substantial grounds. There is no requirement to pay an employee severance in the event of a dismissal, unless it arises by reason of redundancy (see Question 15). Some employers may choose to offer an ex gratia payment on termination of employment in exchange for a waiver of the employee's right to bring claims arising under statute, contract, tort, common law or equity.

Where an employee alleges unfair dismissal, a claim can be brought before either:

  • A Rights Commissioner.

  • The Employment Appeals Tribunal.

The claim must be made within six months of the date of dismissal, but this can be extended to 12 months in exceptional circumstances. The unfair dismissal regime operates separately to an employee’s right to bring a common law claim for wrongful dismissal before the civil courts (for example, for breach of contract). However, the employee cannot recover damages in both forums.

Remedies for unfair dismissal include:

  • Reinstatement to the same position as before the termination, with back pay.

  • Re-engagement to the same or similar position as before the termination, with or without back pay.

  • Compensation.

The maximum award that can be awarded for an unfair dismissal is 104 weeks' remuneration (based on the employee's actual financial loss), except in cases where the Protection of Employment (Exceptional Collective Redundancies and Related Matters) Act 2007 applies. In this case, the award of damages can be up to five years’ remuneration, depending on the employee's length of service. In civil cases, the court will award damages in accordance with the usual principles, depending on the nature of the claim.

Under contract law and statute, an employer or employee wishing to terminate employment must give the other party notice of termination. Notice should be the longer of contractual notice or statutory minimum notice. The length of the statutory minimum notice depends on the employee's length of service:

  • 13 weeks to two years' service: one week's notice.

  • Two to five years' service: two weeks' notice.

  • Five to ten years' service: four weeks' notice.

  • Ten to 15 years' service: six weeks' notice.

  • 15 or more years' service: eight weeks' notice.

15. Are redundancies and mass layoffs regulated?

Redundancies are regulated by three primary pieces of legislation:

  • The Redundancy Payments Acts 1967 to 2007.

  • The Protection of Employment Acts 1977 to 2007.

  • The Protection of Employment (Exceptional Collective Redundancies and Related Matters) Act 2007.

The Protection of Employment Acts 1977 to 2007 prescribes the procedures to be followed in a collective redundancy. This includes employee representation and a mandatory consultation process.

A collective redundancy arises if over any 30 consecutive days:

  • Five employees are dismissed in an undertaking normally employing more than 20 and fewer than 50 employees.

  • 20 employees are dismissed in an undertaking normally employing more than 50 but fewer than 100 employees.

  • 10% of employees are dismissed in an undertaking normally employing more than 100 and fewer than 300 employees.

  • 30 employees are dismissed in an undertaking normally employing 300 or more employees.

Under the Redundancy Payments Acts 1967 to 2007, a statutory redundancy payment is generally payable to employees who have completed more than 104 weeks' service. In basic terms, statutory redundancy is calculated as two weeks' pay per year of service, plus one additional "bonus week", with a week’s pay capped at a maximum of EUR600.

It is open to employers to provide enhanced redundancy payments and this is generally in exchange for a waiver of the employee's rights to bring legal claims.



Taxes on employment

16. In what circumstances is an employee taxed in your jurisdiction and what criteria are used?

Individuals are tax resident for a particular tax year if they are present in Ireland either for:

  • 183 days or more in that year.

  • 280 days or more over that year and the previous tax year taken together.

An employee is not regarded as resident for any tax year in which he spends 30 days or less in Ireland.

17. What income tax and social security contributions must be paid by the employee and the employer during the employment relationship?

Tax resident employees

Income tax. Employees are liable to income tax on their worldwide annual taxable income at:

  • 20% on the first EUR32,800.

  • 41% on the remainder.

There are individual tax credits, which vary depending on the employee's circumstances, and can be set off against their income tax liability.

Universal Social Charge (USC) applies from 1 January 2011 to replace the health and income levies, at rates varying from 2% to 10%, depending on income and age. USC is treated as a tax rather than a social security contribution for tax purposes.

Social security contributions. PRSI (social insurance) also generally applies at 4% for employees.

Filing requirements. Pay-as-you-earn (PAYE) is the administrative method of collecting tax from employment income. The obligation is on the employer to ensure that the appropriate amount of tax is deducted from the employee's pay and paid to the Irish Revenue Commissioners.

Non-tax resident employees

In general, salaries derived by a non-tax resident employee from employment in Ireland can be taxable both in Ireland and in the employee's country of residence if the duties of employment are carried on in Ireland, subject to any relief provided by a double tax treaty (see Question 25).

Temporary assignees to Ireland from an EU member state, or a country with which Ireland has a social security totalisation agreement (such as that between Ireland and the US) may have to continue to pay social security contributions in their home country. Otherwise, PRSI may apply.


PRSI (social insurance) generally applies at 10.75% for employers.

It is the responsibility of the employer to deduct the correct amount of tax from the employee's pay through the PAYE system and to pay this to the Irish Revenue Commissioners.

Business vehicles

18. When is a business vehicle subject to tax in your jurisdiction?

Tax resident business

Companies incorporated in Ireland are considered resident in Ireland, subject to certain exceptions. Where the exceptions apply or where the company is not Irish incorporated, the company is regarded as resident in Ireland if it is centrally managed and controlled in Ireland. The terms of a double tax treaty can render an otherwise Irish resident company non-Irish resident by virtue of being resident in a treaty partner country.

Non-tax resident business

Non-resident companies must pay corporation tax on Irish source income (which includes, for example, trading income and deposit interest from a bank account), subject to any relief provided by a double tax treaty (see Question 25).

Irrespective of residence, stamp duty is charged on certain documents executed in Ireland which relate to any property situated in Ireland or any matter or thing done or to be done in Ireland, wherever executed.

19. What are the main taxes that potentially apply to a business vehicle subject to tax in your jurisdiction (including tax rates)?

Corporation tax

Companies that are resident in Ireland must pay corporation tax on worldwide profits and chargeable capital gains (subject to double taxation treaty relief).

The standard rate of corporation tax on Irish trading profits is 12.5%. To benefit from this rate, companies must derive income from a trade that is actively carried on in Ireland.

A rate of 25% applies to non-trading (for example, rental income and royalty income) and foreign-source income.


VAT is charged on certain imports and on goods and services supplied in Ireland in the course of business. VAT ranges from 0% to 23% depending on the product or service.

Stamp duty

Stamp duty is charged on certain documents executed in Ireland. The tax payable is either a fixed duty or a percentage of the value of the transaction (for example, 1% on share transfers, and between 1% and 2% on property transfers).

Capital gains tax

A company must pay tax on any gains it realises on the disposal of its capital assets at an effective rate of 33%. However, an exemption applies to disposals of shares held by a holding company in its subsidiary where:

  • The subsidiary is resident in Ireland, the EU or a treaty state.

  • The subsidiary is a trading company or group.

  • The parent held a minimum of 5% of the shares of the subsidiary for an uninterrupted period of at least 12 months in the previous 24 months.

Disposals of assets relating to these shares (for example, options to dispose of or acquire the shares) are similarly exempt.

Dividends, interest and IP royalties

20. How are the following taxed:
  • Dividends paid to foreign corporate shareholders?

  • Dividends received from foreign companies?

  • Interest paid to foreign corporate shareholders?

  • Intellectual property (IP) royalties paid to foreign corporate shareholders?

Dividends paid

Dividends paid by a resident company are generally subject to dividend withholding tax (DWT) at the standard income tax rate (currently 20%), unless both:

  • One of the many exemptions applies (for example, for EU residents or residents of a country that has an applicable double tax treaty with Ireland (treaty country) (see Question 25)).

  • A form is filed with the paying company.

Dividends received

Dividends received are generally taxed at 25%. However, some exceptions exist:

  • Dividends between Irish companies are generally exempt.

  • A 12.5% rate applies to dividends paid out of the trading profits of EU or treaty country resident companies.

  • A 12.5% rate applies to dividends received by an Irish resident company from a portfolio shareholding (less than 5%) which come from:

    • an investment in a company resident in the EU;

    • a country which has a double taxation treaty with Ireland.

Ireland also operates a flexible system of foreign tax credits (including pooling) both under its tax treaty network and a system of unilateral credits for non-treaty countries.

A tax credit introduced in the Finance Act 2013 effectively provides a top-up where the actual tax credit available under a tax treaty or unilateral credit provision is insufficient.

Interest paid

In general, Irish source interest is subject to withholding tax at the standard income tax rate of 20%. However, many domestic exemptions exist, including exemptions for interest paid:

  • On commercial paper, certificates of deposit and certain listed bonds.

  • To all residents of EU member states (other than Ireland) and most treaty country residents.

  • To which the Interest and Royalty Directive applies.

IP royalties paid

Payments made for intellectual property rights are not subject to withholding tax with the exception of Irish source patent royalties and certain annual payments (which are subject to a withholding tax of 20%). However, relief under various tax treaties usually reduces the rate to 0%.

In addition to treaty relief, an exemption applies to patent royalties paid by an Irish trading company to most EU or treaty country resident companies if the royalties are both:

  • Made for bona fide commercial reasons.

  • Not made in connection with a trade or business that is carried out in Ireland through a branch or agency of the company receiving the payment.

Groups, affiliates and related parties

21. Are there any thin capitalisation rules (restrictions on loans from foreign affiliates)?

Ireland does not have thin capitalisation rules. However, Ireland does have rules which treat interest payments to certain non-EU resident associated companies as distributions.

22. Must the profits of a foreign subsidiary be imputed to a parent company that is tax resident in your jurisdiction (controlled foreign company rules)?

Ireland does not have any controlled foreign company rules.

23. Are there any transfer pricing rules?

Ireland implemented a transfer pricing regime in 2010 that is based on OECD principles. It applies to arrangements concluded on or after 1 July 2010. The transaction is taxed as if it were at arm's length if all of the following conditions apply, the:

  • Arrangement involves a supply and acquisition of goods, services, monies or intangible assets.

  • Parties to the arrangement are connected.

  • Relevant transaction is taxed as part of the trading activities of either or both parties.

  • Effect of the arrangement is to result in the understatement of trading profits that are subject to tax in Ireland at the 12.5% rate.

The transfer pricing regime does not apply to small-to-medium enterprises, which are those with both:

  • Less than 250 employees.

  • Turnover of less than EUR50 million or assets of less than EUR43 million on a group basis.

Customs duties

24. How are imports and exports taxed?

The taxation of imports and exports depends on whether goods are imported or exported within the EU or outside.

VAT is generally payable on imports. Credit is given for VAT to registered traders and so generally it is ultimately borne by the final consumer. Customs and excise duties are generally levied on imports from outside the EU. The rate of duty depends on the precise nature and circumstances of the import.

Exports are zero rated for VAT, except those exported to unregistered persons in the EU. The place of supply of certain services is subject to the "reverse charge mechanism".

Double tax treaties

25. Is there a wide network of double tax treaties?

Ireland has signed comprehensive double tax treaties with 70 countries, of which 68 are in effect, including treaties with all EU member states, the US, China, India and all OECD member countries. Ireland generally grants the benefit of treaties on their signature, pending ratification.

When a double taxation agreement does not exist with a particular country there are provisions in the Irish Taxes Consolidation Acts 1997 which allow unilateral relief against double taxation in respect of certain types of income.



26. Are restrictive agreements and practices regulated by competition law? Is unilateral (or single-firm) conduct regulated by competition law?

Competition authority

The Irish Competition Authority is the relevant enforcement body. The Competition Authority must take court proceedings in order to establish an infringement of the competition rules. The Irish Government recently published the Competition and Consumer Protection Bill 2014 (which has yet to be enacted), which proposes to dissolve the Competition Authority, and to transfer its functions to a newly established Competition and Consumer Protection Commission.

Restrictive agreements and practices

Irish competition law is based on EU competition law and is contained in the Competition Acts 2002 to 2012 (The Competition Act). The Competition Act prohibits:

  • All restrictive arrangements between undertakings (unless they satisfy certain efficiency conditions) (section 4, Competition Act).

  • The abuse of a dominant position by one or more undertakings in any market in Ireland (section 5, Competition Act).

Infringements of competition law can be challenged under criminal and civil law. In practice, only serious cartel infringements (for example, price-fixing) are criminally prosecuted where the potential sanctions include:

  • A fine for the undertakings concerned.

  • A fine and/or imprisonment for senior officers of the undertakings concerned.

In civil enforcement actions, the Irish Competition Authority can seek a declaration that an infringement exists, and an injunction to prevent its continuance, but does not have the power to:

  • Seek damages.

  • Impose an infringement finding which is binding on an undertaking by administrative decision.

  • Impose administrative fines.

If the Competition Authority settles a civil case, the settlement can be made an Order of the High Court.

Unilateral conduct

Unilateral conduct is regulated by section 5 of the Competition Act which prohibits the abuse of a dominant position by one or more undertakings in a market in Ireland or part of Ireland.

Infringement of section 5 can be challenged under the criminal and civil standard but, in practice, actions will only be taken in the civil courts. The High Court can also impose structural remedies on dominant companies which abuse their dominance.

27. Are mergers and acquisitions subject to merger control?

Mergers and acquisitions fall under the provisions of the EU Merger Regulation or, failing that, the Competition Act. Notification depends on the turnover of the undertakings involved.

Notification to the Competition Authority will be required if all of the following thresholds are met:

  • The worldwide turnover of each of two or more of the undertakings involved in the proposed transaction is not less than EUR40 million.

  • Two or more of the undertakings involved in the proposed transaction carries on business in any part of the island of Ireland.

  • The turnover in Ireland of any one of the undertakings involved in the proposed transaction is not less than EUR40 million.

Foreign to foreign acquisitions are subject to the notification requirements if they meet the thresholds, regardless of where they are domiciled.

On notification, the Competition Authority considers whether the merger should be allowed to proceed.

Special considerations apply to mergers involving media businesses. The Competition and Consumer Protection Bill 2014 (which has yet to be enacted), proposes to introduce changes to the review of these media mergers.


Intellectual property

28. Outline the main IP rights in your jurisdiction.


Definition and legal requirements. For an invention to be patentable, it must (Patents Act 1992):

  • Be susceptible to industrial application.

  • Be new.

  • Involve an inventive step.

The patent owner can prevent direct or indirect use of his invention by third parties without his consent.

Registration. The Controller of Patents, Designs and Trade Marks at the Irish Patents Office (IPO) grants patents. The procedure is by submission of application and the fees vary depending on the type of application made.

Enforcement and remedies. The patent owner can enforce his patents rights in court. Remedies include obtaining:

  • Damages.

  • An account of profits arising from the alleged infringement.

  • An injunction restraining the defendant from infringing the patent.

  • An order requiring the defendant to deliver up or to destroy any goods covered by the patent.

  • A declaration that the patent is valid and has been infringed.

Length of protection. A patent can be granted for a full term of 20 years. It is possible to obtain a short term patent for a period of ten years. In obtaining a short term patent, there is a lower threshold of inventiveness.

Trade marks

Definition and legal requirements. Trade marks are defined as any sign capable of both:

  • Being represented graphically.

  • Distinguishing goods or services of one undertaking from those of other undertakings.

Protection. Protection for an Irish trade mark is obtained by application for registration at the IPO. The Trade Marks Act 1996 gave effect to the Council Regulation No. 40/94 on the Community Trade Mark (CTM). If a party wishes to register a CTM, this must be done through the Office for Harmonisation in the Internal Market (OHIM) in Spain. A CTM provides EU-wide protection.

Enforcement and remedies. These are the same as for patents (see above, Patents), except that a declaration is not an available remedy for trade mark infringement.

Length of protection and renewability. Protection lasts for ten years and is indefinitely renewable for ten-year periods, subject to the payment of fees.

Registered designs

Definition. A design means the appearance of the whole or a part of a product resulting from the following features of the product itself or its ornamentation:

  • Lines.

  • Contours.

  • Colour.

  • Shape.

  • Texture.

  • Materials.

To be registrable as a design, it must be new and have individual character. The owner of the design can assert his rights against any third party who undertakes any act which is the exclusive right of the owner.

Registration. An Irish registered design right is obtained by registration at the IPO. Community designs are registered with OHIM.

Enforcement and remedies. The design owner can enforce the right in court. Remedies include damages, an injunction and an account of profits.

Length of protection and renewability. Protection lasts for five years, renewable for successive five-year periods (up to a total of 25 years).

Unregistered designs

Definition and legal requirements. Unregistered designs that are novel are protected by Regulation (EC) No 6/2002 on Community designs. For the unregistered design to come into existence, it must have been made available to the public after 6 March 2002. Protection is limited to the prevention of the copying of the design.

Enforcement and remedies. The owner of the unregistered design can enforce the right in court against any third party who undertakes any act which is the exclusive right of the proprietor. It attaches a presumption of validity to designs made available to the public after 6 March 2002.

Length of protection. Protection lasts for three years from the date on which the design was first made available to the public within the EU.


Definition and legal requirements. Copyright subsists in:

  • Original literary, dramatic, musical or artistic works.

  • Sound recordings, films, broadcasts and cable programmes.

  • The typographical arrangement of published editions.

  • Original databases.

Protection. To obtain protection, the work must be original. The protection applies to works only and not ideas. It subsists automatically on creation and there is no registration requirement. The copyright owner is granted the following (Copyright and Related Rights Act 2000):

  • Reproduction rights.

  • Making available rights.

  • Distribution rights.

  • Rental and lending rights.

  • Adaptation rights.

An infringement occurs where an unauthorised party undertakes any of these acts or authorises a third party to undertake the acts without the permission of the copyright owner.

Enforcement and remedies. The copyright owner can enforce the right in court. Remedies include:

  • Damages.

  • An injunction.

  • A delivery up order.

  • A seizure order.

  • A destruction order.

  • An account of profits.

Length of protection and renewability. Copyright in literary, dramatic, musical and artistic works or original databases lasts for the lifetime of the author plus 70 years. Protection in a film expires 70 years after the death of the last of the following people:

  • The principal director of the film.

  • The author of the screenplay of the film.

  • The author of the dialogue of the film.

  • The author of music specifically composed for use in the film.

Copyright in a musical composition with words expires 70 years after the death of either the author of the musical composition or the author of the words of the musical composition, whichever death is later. Copyright in a sound recording generally lasts for 50 years after it is made or made available (if it is made available during such 50 years). Copyright in a broadcast expires 50 years after the broadcast is first transmitted. Protection in a computer-generated work expires 70 years after the date on which the work is first made lawfully available to the public.


Confidential information is information communicated in circumstances importing an obligation of confidence (for example, in the course of employment). Protection can arise automatically at common law or under contract. Whether the protection arises depends on the type of information imparted. The information must have the necessary quality of confidence. The information must have been imparted in circumstances which imposed an obligation of confidentiality on the other person. The right is enforced by an action for breach of confidence, either under contract law or under tort law. Protection lasts for as long as the information remains confidential and there is a legitimate interest that requires protection. A party alleging a breach of confidence must be able to show that the other person used the information in a manner that is not intended or authorised by the owner.


Marketing agreements

29. Are marketing agreements regulated?


Commercial agency is regulated by the European Communities (Commercial Agents) Regulations 1994 and 1997. Agency agreements must be evidenced in writing. The regulations contain certain mandatory provisions which afford protections for commercial agents, in particular a right to compensation on the termination of the agency relationship.


Distribution agreements are a type of contract for sale. Therefore, suppliers’ duties are set out in the Sale of Goods Act 1893, as amended by the Sale of Goods and Supply of Services Act 1980.


There is no single statute or code in Ireland which governs the law as it relates to franchising. The law of franchising is for the most part governed by:

  • The ordinary principles of contract law.

  • The laws relating to intellectual property.

  • In many instances, competition law.

In addition, the provisions of the updated European Commission Guidelines on Vertical Restraints (SEC 2010 411) sets out the principles for assessment of vertical agreements. Furthermore, the updated Declaration in respect of Vertical Agreements and Concerted Practices (D/10/001) issued by the Competition Authority applies to all agreements or concerted practices entered into between two or more undertakings. This relates to the conditions under which parties can purchase, sell or resell certain goods or services.



30. Are there any laws regulating e-commerce (such as electronic signatures and distance selling)?

E-commerce is regulated by the following legislation:

  • The Electronic Commerce Act 2000 implements the Electronic Signatures Directive 1999/93/EC and some provisions of the Electronic Commerce Directive 2000/31/EC. The remaining provisions of the latter Directive were implemented by the Electronic Commerce Regulations 2003 (SI 68/2003). The Electronic Commerce Act 2000 regulates electronic signatures and advanced electronic signatures as well as electronic forms of original information. The European Communities (Protection of Consumers in Respect of Contracts made by means of Distance Communications) Regulations 2001 regulates distance contracts.

  • The European Communities (Companies) (Amendment) Regulations 2007 provides that Irish registered limited liability companies must display certain basic information on their websites and certain electronic communications.

  • European Union (Consumer Information, Cancellation and Other Rights (Regulations) 2013 transposes the Consumer Protection Directive into Irish law and came into effect on 13 June 2014. It establishes rules on the information to be provided for distance contracts (over the internet), off premises (at a person's workplace) and other types of contracts.



31. Outline the regulation of advertising in your jurisdiction.

The Consumer Protection Act 2007 prohibits misleading commercial practices (section 42, Consumer Protection Act 2007). In particular, it protects consumers from misleading advertising and ensures that trade is fair. EU law also prohibits misleading advertising (SI 134/1988 (European Communities (Misleading Advertising) Regulations 1988). Misleading advertising is that which deceives or is likely to deceive a party that sees it. The Consumer Protection Act 2007 also set up the National Consumer Agency (the Agency) (section 7, Consumer Protection Act 2007). The responsibilities of the Agency include the promotion and protection of the interests and welfare of consumers. The Agency, as part of its role, prosecutes for breaches of consumer law, such as misleading advertising.

The Advertising Standards Authority of Ireland (the ASAI) is an independent, self-regulatory group set up and funded by the advertising industry. They are committed to promote high standards in advertising, in the public interest, and they investigate complaints made by individuals. The ASAI have produced an updated Code that members must abide by. The ASAI Code covers advertising in the format of advertisements in the following:

  • Newspapers.

  • Magazines and other printed publications, including:

    • free sheets;

    • posters and aerial advertisements;

    • brochures,

    • leaflets,

    • circulars,

    • mailings and fax transmissions;

  • Commercials broadcast on television or radio or screened in cinemas.

  • Advertisements carried on audiotapes, videotapes and other electronic and computer systems.

  • Sales promotion material.

  • Advertisement features and promotions.

  • Marketing communications in a non-paid space online under the control of the advertiser or the agent, including but not limited to, the advertiser's own website.

In addition to this, certain industries are governed by industry specific rules, for example, specialised advertisements to medical and other professionals, advertising by certain professions and the promotion of medicines.

The Data Protection Acts 1988 and 2003, and the ePrivacy Regulations (S.I 336 of 2011), regulate the procedure for direct marketing by organisations.


Data protection

32. Are there specific statutory data protection laws? If not, are there laws providing equivalent protection?

Data protection is regulated primarily by the:

  • Data Protection Acts 1988 and 2003 (which implements Directive 95/46/EC).

  • European Communities (Electronic Communications Networks and Services) (Privacy and Electronic Communications) Regulations 2011 (which implements Directive 2002/58/EC, as amended by directive 2006/24/EC and 2009/136/EC).

These data protection provisions are enforced and administered by the Office of the Data Protection Commissioner.


Product liability

33. How is product liability and product safety regulated?

Product liability is regulated by:

  • The Liability for Defective Products Act 1991. Strict liability is imposed on a producer for damage caused wholly or partially by a defect in his product.

  • Common law/tort principles of negligence and duty of care.

  • Contract law. Under the Sale of Goods Act 1893 as amended by the Sale of Goods and Supply of Services Act 1980, goods must:

    • be of merchantable quality;

    • be as described;

    • be fit for their intended purpose; and

    • correspond to sample.

The product safety regime is set down by the European Communities (General Product Safety) Regulations 2004, which prohibit the placing of dangerous products on the market, and can impose criminal liability. An EU wide Regulation on Consumer Product Safety is expected to come into force over the next year which will replace this legislation. The statutory body responsible for enforcement is the National Consumer Agency. The Irish government recently published the Competition and Consumer Protection Bill 2014 (which has yet to be enacted), which proposes to dissolve the National Consumer Agency, and to transfer its functions to a newly established Competition and Consumer Protection Commission.


Main business organisations

The Department of Jobs, Enterprise and Innovation


Main activities. It is responsible for implementing and developing the areas of enterprise and innovation, and supporting the creation of jobs.

Companies Registration Office


Main activities. The statutory authority for registering new companies in Ireland.

The Office of the Revenue Commissioners


Main activities. It is responsible for collecting taxes and duties and implementing Custom controls.

Enterprise Ireland


Main activities. It provides assistance to Irish owned companies or subsidiaries of foreign companies.

IDA Ireland


Main activities. It deals with grant assistance for inward investment.

Online resources

Irish Statute Book


Description. Contains the Acts of the Oireachtas (Parliament), Statutory Instruments and Legislation Directory for the period 1922 to 2014.

Irish tax and customs


Description. Information relating to taxes and duties.

Companies Registration Office


Description. Information relevant to companies and filing obligations.

Jobs, Enterprise and Innovation


Description. Information relevant to employees and employers.

National Employment Rights Authority


Description. Information relevant to employees and employers.

Workplace relations


Description. Information relevant to employees and employers.

Department of Foreign Affairs and Trade


Description. The website provides visa information.

The Competiton Authority


Description. Information relating to The Competition Authority.

Data Protection Commissioner


Description. The website provides data protection information.

The Patents Office


Description. The website provides information relating to intellectual property.

Contributor profiles

John Matson, Partner

Arthur Cox (Lex Mundi Member Firm)

T +353 (0)1 618 0510
F +353 (0)1 618 0720

Professional qualifications. New York Bar (non-practising), 1999; Solicitor in Ireland, 1996; HDBS, 1993, Smurfit Graduate School of Business, University College, Dublin; BCL, 1992, University College, Cork.

Areas of practice. Corporate and M&A; commercial agreements and contracts; company compliance and governance; inward investment; insurance and reinsurance.

Recent transactions

  • Acting for Aviva Europe with respect to a complex pan-European shared services arrangement utilizing an EEIG.
  • Acting for Qualcomm Inc. on the acquisition of Xiam Technologies Limited.
  • Advising a number of international insurance companies with respect to various corporate transactions.
  • Acting for a number of European conglomerates with respect to Court-sanctioned cross-border mergers into Ireland.
  • Acting for Mastercard on the acquisition of Orbiscom Limited.
  • Acting for Wolters Kluwer on the acquisition of Ci-3 Consultancy Limited.
  • Acting for the Irish Department of Finance with respect to due diligence on, and the recapitalisation of, specific Irish financial institutions.
  • Lead corporate partner acting for the Willis Group with respect to its corporate migration from Bermuda to Ireland.
  • Lead partner for Wells Fargo Bank on the establishment of its Irish operations and ongoing corporate and transactional advice.

Languages. English

Professional associations/memberships

  • The Bar Association of the City of New York.

  • The New York Bar Association.

  • The American Bar Association.

  • The Irish Chamber of Commerce in the U.S.


  • Author of the Lex Mundi Guide to Doing Business in Ireland.

  • Author of the Chambers Europe Country Overview: Ireland.

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