Establishing Special Purpose Vehicles (SPVs) in Ireland, Autumn 2008
19.09.2008
Ireland has firmly established itself as a jurisdiction for the establishment of special purpose vehicles (SPVs) for structured finance transactions, particularly repackagings, synthetic and cash flow CDOs, asset-backed commercial paper programmes, securitisations, LPN structures and a host of other receivables financing transactions. Favourable tax laws allow the structures to be, in most cases, tax neutral and a “quoted eurobond” exemption, together with an extensive range of domestic provisions and double taxation treaties, allows interest on debts to be paid gross in most cases. In addition, recent changes in law that allow the use of private companies for most bond transactions will make incorporating an Irish SPV significantly easier. However, Ireland is not a tax haven jurisdiction and careful tax planning is required at an early stage of any transaction. Once the optimum tax treatment is achieved however, an SPV located in Ireland benefits from the fact that it is an EU issuer located in an “on shore” jurisdiction.
