Middle East
The Practice
Ireland has already earned a reputation as being an important centre for financial services by offering a number of financial solutions for investment structures which operate both within and outside the European Union. This strategy has been very successful for European, Southeast Asian and North American Investors.
Ireland is a member of the EU and the only English speaking member of the Eurozone. In addition it is a founder member of the OECD. Like the UK and the U.S., Ireland is a common law jurisdiction and its legal concepts will be recognised by most investors. It is a good location for private wealth management and succession rights. Ireland is not a tax haven jurisdiction and is on the G20 “White List”, making it more attractive for investment in the current environment.
The Irish Financial Regulatory Services Authority (the “Financial Regulator”) has established a regulatory unit for authorising Sharia compliant investment products in Ireland. The Financial Regulator has confirmed that it will proactively engage with its regulatory counterparts in the Middle East, North Africa and other jurisdictions. This coincides with the United Arab Emirates, Bahrain, Kuwait, and Saudi Arabia due to sign double taxation agreements with Ireland by the end of 2009.
The Irish Revenue Commissioners has recently published guidance on the Irish tax consequences of Sharia Funds, Ijarah as finance leases, operating leases and hire purchase contracts and Takaful (Insurance) and Retakaful (Reinsurance) Arrangements. Broadly, these are given the beneficial tax treatment that is given to their western equivalents.
The listing of the first Sukuk transaction on the Irish Stock Exchange (the “ISE”) in 2005 enhanced Ireland’s profile in the global Islamic finance industry and is a perfect illustration of the flexibility of the ISE towards Sharia compliant products.
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