Investing in Ireland Issue 42, March 2020
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Investing in Ireland
Issue 42, March 2020
Happy St. Patrick’s Day and welcome to the March In addition, this issue also highlights the ongoing work
2020 edition of PwC’s newsletter on foreign direct that Ireland is undertaking to expand its network of
investment (‘FDI’) in Ireland. Double Taxation Agreements (see page 6), as well
as upcoming news and events in FDI (see page 7).
A significant number of jobs and investment
announcements over the last few months reflect Please do not hesitate to contact myself, any
continued FDI growth in Ireland (see page 2). member of our team, or your usual PwC Ireland
contact at any stage. We would be happy to tell you
A newly published report by IDA Ireland outlining more about the topics raised in this issue or to
FDI results for 2019 shows that record numbers are include any interested parties on our mailing list.
now employed in the multinational sector (see page 4).
Remember to visit our FDI website for more
This issue also takes a look at why Ireland is a prime updates and detailed information, including a range
location for companies in the pharmaceutical of recent publications.
industry (see page 5) and the Paying Taxes report
published by PwC which highlights Ireland’s
competitive tax system (see page 6).
Liam Diamond
+353 1 792 6579
+353 86 405 6965
liam.diamond@pwc.com
1
Recent FDI investment
announcements
Allergan Plc, an Irish-headquartered IDA Ireland, the agency responsible for attracting
pharmaceutical company, has opened a state-of- FDI to Ireland, announced plans to construct a high
the-art Biologics facility at its Westport Campus in tech manufacturing space with ancillary office space
Co.Mayo, creating 63 new jobs and bringing their over two floors in the IDA Business & Technology
total investment in Ireland to over €750m. Allergan Park in Monaghan. This €150m programme of
Plc is a global integrated biopharmaceutical leader constructing Advanced Technology Buildings (‘ATB’)
and its facility in Westport, which is one of four in has already seen 8 buildings completed with plans
Ireland, develops and manufactures a range of to construct others in Sligo, Athlone, Carlow and
branded medicines primarily for export. Dundalk this year to attract and retain FDI jobs.
Apple, an American multinational technology Mastercard, a leader in payments technology,
company, has received the IDA Ireland’s inaugural has announced plans to grow its workforce with
“Special Recognition Award” for it’s contribution to investments in AI, cyber security, blockchain, user
Ireland’s economy over the past 40 years. Apple experience teams, and more. They plan to create
established its first European Operation in Cork in 1,500 jobs in the next three to five years at its new
1980 and employs 6,000 people today. The award European Technology Hub in Dublin.
recognises their contribution to not only the
economy but also the schools and charities where Payoneer, a digital payment platform, has opened a
many of the Apple team volunteer their time to new office in Dublin. This ensures that their thousands
benefit the local community. of enterprise clients and small businesses in over
200 countries can continue to execute business
AxiomSL, a provider of enterprise-wide solutions operations seamlessly in the EEA following Brexit.
for Regulatory Reporting, Capital Adequacy, Risk They offer services such as cross border payments,
Management, Liquidity, Compliance and Data working capital, tax solutions, merchant services
Management, has opened a business operations and risk management.
centre in Limerick which will create up to 100 jobs
over the next five years. Servier, an international pharmaceutical company,
has celebrated its 30th anniversary of manufacturing
Horizon8, an innovative technology solutions at its site in Arklow, their largest production facility
company, opened their first European headquarters outside of France. They employ over 450 employees
in Cork in January. 50 new jobs are expected to be and export to more than 100 countries worldwide
created for high-skilled workers such as engineers, from their site in Arklow.
developers and business consultants. The company
has collaborated with University College Cork to
drive R&D activities in Ireland.
2
“Ireland has been a second home for Apple for forty years “We’re delighted to launch
and this honour is even more special for us because it in Dublin and join the
recognises the contributions of our incredible team here growing number of
who work tirelessly to serve our customers around the e-money and payment
country, and around the world. I believe deeply that our institutions established
most important work together is still ahead of us, and I’m here. Ireland has a credible
grateful to the people of Ireland for their commitment to and experienced regulator
openness, to innovation and to the cooperation that will in the CBI and provides
make possible the next generation of world-changing ideas.” access to a sophisticated
Tim Cook, Chief Executive Officer at Apple Inc financial services
ecosystem with the deep
pool of staff, managers,
professional advisers and
service providers that
we’re looking for as we
grow operations”
Patrick de Courcy, SVP of Global
Banking and Regulatory
Infrastructure at Payoneer
“For Horizon8, Cork offers us access to a deep talent pool,
European connectivity and most importantly a location
which is surrounded by best in class academic institutions.
Through our collaboration with University College Cork, we
are committed to driving R&D innovation in Ireland. We look
forward to building our presence here in the coming years
and creating jobs but also new, cutting-edge solutions for
our customers around the world”
Patrick Horgan, Managing Director of Horizon8 in Europe
3
“The FDI performance over the past five years has been unprecedented
and this strong performance will continue into the first half of 2020.”
Mary Buckley, Executive Director, IDA Ireland
Investment in Ireland 2019
2019 proved a highly increased by 14% to
successful year for IDA Ireland achieves all €218.7bn. Of particular
investment and IDA targets in ‘Winning – Foreign importance has been the
Ireland’s performance Direct Investment 2015-2019’ regional impact of FDI;
in meeting all of its Strategy in 2019, more people
targets set out in are employed by IDA
‘Winning - Foreign Direct companies outside of
Investment 2015-2019’ Numbers directly employed in Dublin than ever before.
Strategy highlights this multinational sector in Ireland
achievement. at an all time high – 245,096 In 2019, 63% of
investment came from
Numbers directly the US and while that
employed in the 1,209 investments won over continues to be the
multinational sector are the course of IDA Ireland’s engine of job growth in
at an all time high and the ‘Winning – Foreign Direct Ireland, the amount of
1,209 investments won Investment 2015-2019’ investment from other
over the course of the 5 Strategy, creating 112,373 countries grew even
year period made it IDA’s jobs, making it IDA’s most faster - from 30% in
most prosperous period successful period of 2014 to 37% in 2019.
of investment to date. investment to date
Ireland’s economic
In 2019 alone, 250 and political stability
investments were Regional investments post Brexit is a core
made and 21,844 increase by 50% over the part of Ireland’s value
jobs were created in past five years proposition to these
FDI companies. The foreign investors and
benefit to the wider Irish the opportunities
economy can be seen In 2019, 21,844 new jobs arising from Brexit
in the expenditure by created in 250 projects related investments will
IDA clients which totaled in FDI companies. Half of continue to strengthen
€21.5bn, an increase of investments were first time FDI performance in
11%, and FDI exports investors 2020.
4
Ireland’s pharmaceutical sector
Ireland first began to attract international exports and highlighting Ireland’s superior location
pharmaceutical companies in the 1960s. within the European Union.
Today, Ireland is home to a thriving pharmaceutical As well as Ireland’s 12.5% statutory corporate tax
industry which is one of the biggest industries in the rate, the attractive IP and R&D tax credit regimes
country. For example, in 2017, Ireland was the 5th have been a significant incentive for pharmaceutical
largest exporter of medicinal and pharmaceutical companies located in Ireland.
products in the
world. Biotech and
Why Ireland for the Pharmaceutical Industry pharma companies
In the past are always on
decade €10bn » 12.5% statutory tax rate the lookout for a
has been invested talented workforce.
» Other tax regime benefits (IP tax depreciation,
in the Irish In Ireland, these
25% refundable R&D Tax Credit, 6.25% PatBox)
pharmaceutical companies have
sector specifically » Highly educated, skilled workforce access to one
in the areas » Strong track record in manufacturing excellence of the youngest
of biopharma and most highly
» Excellent regulatory compliance record
and biotech educated
(HPRA, FDA, EMA)
production populations in
facilities. Ireland » Only English speaking country that uses the euro Europe. Ireland
has been the in the EU provides a rich
location of choice » Ireland has one of the fastest growing economies and strong pool
for the world’s top in the EU of talent for the
10 pharmaceutical sector, through
companies. » Ireland’s Government policies are pro-trade and continued
investment investment in third-
This industry level education
contributes and in mid-2018
over €39bn worth of exports each year to the Irish the sector employed over 30,000 people directly in
economy, accounting for over 50% of Ireland’s total Ireland.
5
Paying taxes in Ireland
The recent Paying Ireland’s tax regime
Taxes 2020 report Key Stats: continues to be one
by PwC found that of the most efficient
Ireland continues to » Ireland has a total tax contribution rate from an administrative
be the most effective (“TTCR”) of 26.1%; the average TTCR perspective in relation
EU country in which in the EU is 38.9% and the global TTCR to paying taxes, filing
to pay taxes and the is 40.5% tax returns, time spent
fourth most effective on same and the
worldwide. » A typical Irish company will spend amount of tax levied on
82 hours dealing with its tax affairs businesses.
The report, which compared to the average of 161 hours
covers 190 global in the EU and 234 hours globally The survey illustrates
economies, shows that having a simpler tax
that businesses are » The time to comply with a corporate system with competitive
affected not only by tax tax correction is 2 hours in Ireland business tax rates
rates, but also by the compared to the average for the EU provides countries
procedural burden of of 7 hours. like Ireland with a real
compliance. competitive advantage.
“The report reconfirms Ireland as the most effective country in the EU for paying taxes.
The analysis considers the ease of filing and paying taxes, as well as the time needed to
obtain refunds and make corrections. The more efficient a tax system, the better it is for
business. This, in turn, helps promote economic growth and investment. We also do very
well in terms of tax competitiveness. this is crucial to our standing as a location of choice
for foreign direct investment.”
Susan Kilty, Head of Tax for PwC Ireland
Ireland’s double taxation
agreements
Ireland has an extensive Double Taxation Agreement » On 7 February 2019, Ireland and Ghana signed a
(‘DTA’) network. Currently they have DTAs signed new DTA which has not yet come into effect.
with 74 countries, of which 73 are in effect.
» In addition to this, negotiations concluded for new
Ireland is currently in the process of negotiating DTAs with Kenya, Kosovo, Oman and Uruguay.
new DTAs and updating existing agreements. » Negotiations have concluded on protocols to
The following work is currently is process:
the existing DTAs with Germany, Isle of Man
» As of 13 June 2019, Ireland and the Netherlands and Mexico.
signed a new DTA which replaces the existing one. » Ireland notified the multilateral Convention to
» On the same day, Ireland and Switzerland implement tax treaty related measures to prevent
signed a protocol amending their existing DTA. BEPs (MLI) in the Finance Bill 2018. This came
into effect on 1 May 2019.
» On 14 May 2019 the protocol to the existing DTA
between Ireland and Belgium entered into force.
6
FDI news & events
AI Global Visions Across two days, 22 and 23 April 2020, experts
AI Global Visions Sligo will take place on 25-26 from over 70 countries will come together to share
March 2020 and is a pioneering European knowledge, debate the latest trends, and network
technology event fully aligned with the AI for in Dublin’s RDS.
Good Global Summit held annually in Geneva,
Switzerland. The event will bring together leaders Dublin Aviation Summit
and experts in AI innovation, research and The Dublin Aviation Summit will be held on 11 and
policymaking and it is intended to engage and 12 of May 2020 in Dublin’s RDS. The event aims to
support Irish-based industries and academia to bring together the leading names in IT, Interiors,
harness the potential that AI will bring to their Maintenance and Repair Operations, Engines, and
sectors. more to meet and network with the thriving Dublin
aviation leasing community. The conference will
FutureScope host displays from hundreds of exhibiting
On 1 April 2020, 1500+ stakeholders active in the companies showcasing their products and
tech and entrepreneurial ecosystems will gather services, and a number of networking events.
at the Convention Centre in Dublin to explore the
implications of emerging technologies. Business Future Human
leaders will share insights on future challenges, Future Human, the evolution of Silicon Republic’s
how emerging technologies will impact business Inspirefest will take place on 21 and 22 May in
and society, the market opportunities that will arise Dublin’s Trinity Business School. Join over 3,000
and the implications of disruption and innovation. visionary attendees from 52 countries plus leading
minds from Life, Science and Tech, vibrantly
Dublin Tech Summit mining the future of Robotics & AI, Urban
The Dublin Tech Summit draws the most influential Landscapes, Security & business, Life Science,
tech and business leaders from across the world. Workplaces and our Planet.
7Ireland economic update
GDP is expected to grow to 3.5% in 2020
Monthly unemployment rate was at 4.8% in January 2020
Consumer Price Index increased by 1.3% in the year to January 2020
80% of people in Ireland believe that Ireland’s membership of the EU is positive
Leading the way
1st 1st
in the world for: in Europe for:
• Government investment incentives1 • Overall business productivity and
efficiency1
• Attitudes towards globalization 1
• The agility of companies1
• Attracting and retaining talents1
• Paying business taxes8
• Image abroad and branding1
• Science, technology, engineering, and
• Business attitudes and values1
mathematics (‘STEM’) graduates5
• Flexibility and adaptability1
• SMEs selling online, e-commerce
• City with the highest economic turnover, cross-border SMEs online
potential (Dublin)3 and open data5
• Business friendliness (Dublin)3 • Innovators in SMEs, employment
• FDI and technology transfer 4 impacts, and sales impacts6
• Life sciences (Dublin)7
• High value exports4
1st
in the Eurozone for:
• Real GDP Growth1
• FDI Global City of the Future
(Dublin)3
1 IMD World Competitiveness yearbook 2019
• Jobs created from foreign direct
2 IBM Global Trends 2019
investment relative to population
3 Global Cities of the Future 2018/19 – FDI Intelligence
size2
4 The Global Talent Competitiveness Index 2019
• Relationship of pay to productivity 4 5 The Digital Economy and Society Index (‘DESI’) Report 2018
• Attracting talented people from 6 European Innovation Scoreboard 2018
abroad4 7 The world’s most competitive cities report 2018
8 PwC/World Bank Group ‘Paying Taxes’ Report 2019
8Would you like
to know more?
Should any of the topics covered in this newsletter be
of particular interest to you, please do not hesitate to
contact any member of the FDI team, or your usual PwC
Ireland contact. If any of your colleagues would like to be
included on our mailing list, please let us know.
Please click on our website for additional information.
Various topics of interest for foreign investors can be
found in the publications link in the tax section, including:
Budget 2020
Brexit
CEO Survey
Previous issue of Investing in Ireland
Tax Facts 2019
9Contacts
Jean Delaney Mary Honohan James McNally
+353 1 792 6280 +353 1 792 8609 +353 1 792 6844
jean.delaney@pwc.com mary.honohan@pwc.com james.o.mcnally@pwc.com
Liam Diamond Susan Kilty John O’Leary
+353 1 792 6579 +353 1 792 6740 +353 1 792 8659
liam.diamond@pwc.com susan.kilty@pwc.com john.oleary@pwc.com
Brian Leonard Ronan MacNioclais Feargal O’Rourke
+353 1 792 6179 +353 1 792 6006 +353 1 792 6480
brian.a.leonard@pwc.com ronan.macnioclais@pwc.com feargal.orourke@pwc.com
Denis Harrington Joe Tynan Garrett Cronin
+353 1 792 8629 +353 1 792 6399 +353 1 792 8807
denis.harrington@pwc.com joe.tynan@pwc.com garrett.cronin@pwc.com
Andy O’Callaghan
+353 1 792 6247
andy.ocallaghan@pwc.com
www.pwc.ie/fdi
This content is for general information purposes only, and should not be used as a substitute for consultation with professional advisors.
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