FATF AML Deficiency List
Conduit for Offshore Financial Centres
US Dept of State Money Laundering assessment
Ireland is not on the FATF List of Countries that have been identified as having strategic AML deficiencies
Compliance with FATF Recommendations
The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in Ireland was undertaken in 2019. According to that Evaluation, Ireland was deemed Compliant for 17 and Largely Compliant for 16 of the FATF 40 Recommendations.
US Department of State Money Laundering assessment (INCSR)
Ireland was deemed a Jurisdiction of Concern by the US Department of State 2016 International Narcotics Control Strategy Report (INCSR). Key Findings from the report are as follows: -
Ireland continues to be a significant European financial hub, with a number of international banks and fund administration firms located in Dublin’s International Financial Services Center. These institutions are monitored and regulated by the Central Bank of Ireland (CBI). The primary sources of funds laundered in Ireland are cigarette smuggling, drug trafficking, diversion of subsidized fuel, domestic tax violations, prostitution, and welfare fraud. Irish authorities estimate up to 80 percent of suspicious transaction reports (STRs) that can be linked to predicate crimes involve funds derived from domestic tax violations and social welfare fraud. While money laundering occurs via financial institutions, illicit funds also are laundered through schemes involving remittance companies, lawyers, accountants, used car dealerships, the purchase of high-value goods for cash, transferring funds from overseas through Irish credit institutions, filtering funds via complex company structures, and by basing foreign or domestic real property sales in Ireland.
A number of cash seizures have occurred at Dublin International Airport. Customs authorities have intercepted cash being smuggled out of Ireland, likely proceeds from drug trafficking. According to Irish authorities, currency intercepted on outbound passengers also may be intended for the purchase of drugs and/or cigarettes for smuggling back to Ireland.
There are no international sanctions currently in force against this country.
BRIBERY & CORRUPTION
Rating (100-Good / 0-Bad)
Transparency International Corruption Index 72
World Governance Indicator – Control of Corruption 891
Corruption is not an obstacle for foreign investors operating in Ireland, although companies continue to experience bribery risks at the local level in relation to public procurement and the issuing of building permits. The Prevention of Corruption Act forbids any individual to give or accept a bribe, including to foreign public officials. A company can be found liable for corrupt acts committed by individuals working on its behalf, and companies registered under the Irish Companies Act can be prosecuted for foreign bribery offences. Facilitation payments are prohibited, and gifts and hospitality are considered illegal if provided 'corruptly'. Irregular payments and bribes almost never occur in business dealings. The government is currently implementing reforms aimed at increasing administrative transparency, accountability and anti-corruption standards after the national Tribunals of Inquiry found evidence throughout Ireland's public administration of conflicts of interest, corruption and collusion between politicians and businesspeople. The Criminal Justice (Corruption) Bill is awaiting enactment; it promises to replace existing laws with a single anti-corruption law, to increase corruption penalties and to require companies to prevent corruption. For further information - GAN Integrity Business Anti-Corruption Portal
Ireland is a small, modern, trade-dependent economy. Ireland was among the initial group of 12 EU nations that began circulating the euro on 1 January 2002.
GDP growth averaged 6% in 1995-2007, but economic activity dropped sharply during the world financial crisis and the subsequent collapse of its domestic property market and construction industry. Faced with sharply reduced revenues and a burgeoning budget deficit from efforts to stabilize its fragile banking sector, the Irish Government introduced the first in a series of draconian budgets in 2009. These measures were not sufficient to stabilize Ireland’s public finances. In 2010, the budget deficit reached 32.4% of GDP - the world's largest deficit, as a percentage of GDP. In late 2010, the former COWEN government agreed to a $92 billion loan package from the EU and IMF to help Dublin recapitalize Ireland’s banking sector and avoid defaulting on its sovereign debt. In March 2011, the KENNY government intensified austerity measures to meet the deficit targets under Ireland's EU-IMF bailout program.
In late 2013, Ireland formally exited its EU-IMF bailout program, benefiting from its strict adherence to deficit-reduction targets and success in refinancing a large amount of banking-related debt. In 2014, the economy rapidly picked up and GDP grew by 5.2%. The recovering economy assisted lowering the deficit to 2.5% of GDP. In late 2014, the government introduced a fiscally neutral budget, marking the end of the austerity program. Continued growth of tax receipts has allowed the government to lower some taxes and increase public spending while keeping to its deficit-reduction targets. In 2015, GDP growth reached 7.8%, the highest growth in the EU for the second consecutive year.
In the wake of the collapse of the construction sector and the downturn in consumer spending and business investment, the export sector, dominated by foreign multinationals, has become an even more important component of Ireland's economy. Ireland’s low corporation tax of 12.5% and a talented pool of high-tech labourers have been key factors in encouraging business investment. Loose tax residency requirements made Ireland a common destination for international firms seeking to avoid taxation. Amid growing international pressure, the government announced it would phase in more stringent tax laws, effectively closing a loophole.
Agriculture - products:
barley, potatoes, wheat; beef, dairy products
pharmaceuticals, chemicals, computer hardware and software, food products, beverages and brewing; medical devices
Exports - commodities:
machinery and equipment, computers, chemicals, medical devices, pharmaceuticals; foodstuffs, animal products
Exports - partners:
US 23.7%, UK 13.8%, Belgium 13.2%, Germany 6.6%, Switzerland 5.5%, Netherlands 4.4%, France 4.4% (2015)
Imports - commodities:
data processing equipment, other machinery and equipment, chemicals, petroleum and petroleum products, textiles, clothing
Imports - partners:
UK 32.5%, US 14%, France 10.2%, Germany 9.3%, Netherlands 4.9%, China 4.1% (2015)
Investment Climate - US State Department
The Irish government actively promotes foreign direct investment (FDI) and has had considerable success in attracting U.S. investment, in particular. Currently, there are approximately 700 U.S. subsidiaries in Ireland operating primarily in the following sectors: chemicals, bio-pharmaceuticals and medical devices, computer hardware and software, electronics, and financial services.
One of Ireland's most attractive features as an FDI destination is its low corporate tax rate, which has remained at 12.5 percent since 2003. The regime is also relatively simple, as the reported effective tax rate is 12.4 percent. Other factors cited by foreign firms include: the quality and flexibility of the English-speaking workforce, availability of a multi-lingual labor force, cooperative labor relations, political stability, pro-business government policies and regulators, a transparent judicial system, transportation links, proximity to the United States and Europe, and the drawing power of existing companies operating successfully in Ireland (a "clustering" effect).
All firms incorporated in Ireland are treated on an equal basis; Ireland's judicial system is transparent and upholds the sanctity of contracts, as well as laws affecting foreign investment. Conversely, factors that negatively affect Ireland’s ability to attract investment include: high labor and operating (such as energy) costs, skilled-labor shortages, eurozone risk, any residual fallout from Ireland’s ongoing economic and financial restructuring, sometimes-deficient infrastructure (such as in transportation, energy and internet/broadband), uncertainty in European Union policies on some regulatory matters, and absolute price levels that are among the highest in Europe.
There is no formal screening process for foreign investment in Ireland, though investors looking to receive government grants or assistance through one of the four state agencies responsible for promoting foreign investment in Ireland are often required to meet certain employment and investment criteria.
Ireland uses the euro as its national currency and enjoys full current and capital account liberalization.
Secured interests in property, both chattel and real estate, are recognized and enforced. Ireland is a member of the World Intellectual Property Organization (WIPO) and a party to the International Convention for the Protection of Intellectual Property.
There are a number of state-owned enterprises (SOEs) in Ireland in the energy, broadcasting and transportation sectors. All of Ireland’s SOEs are open to competition for market share.
The United States and Ireland do not have a Bilateral Investment Treaty, but have shared a Friendship, Commerce, and Navigation Treaty, which provides for national treatment of U.S. investors, since 1950. The two countries also share a Tax Treaty since 1998 which was supplemented in December 2012 with an agreement to improve international tax compliance and to implement the U.S. Foreign Account Tax Compliance Act (FATCA).
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