Irish Finance Bill provides certainty for UCITS IV
05/02/2010

Finance Bill 2010, published yesterday, includes a number of welcome measures that will enhance Ireland's attractiveness as a location for regulated funds and for UCITS IV Management Companies in particular. The changes will provide certainty with regard to the tax treatment of foreign funds that are managed from Ireland under the new UCITS IV arrangements.

The Finance Bill measures ensure that a foreign fund managed by an Irish UCITS IV Management Company will not be regarded as having a taxable presence in Ireland and that no adverse tax consequences arise. The Finance Bill effectively confirms that the rationalisation opportunities under
UCITS IV can be availed of without giving rise to any charge to Irish tax for the foreign funds concerned or change in tax status for the underlying investors.

Stamp duty reliefs available under Irish legislation in relation to fund reorganisations, reconstructions and amalgamations have also been updated to allow stamp duty exemptions where units are issued to the foreign fund as opposed to its unit holders. This is a significant change that facilitates the master/feeder structures envisaged under UCITS IV and also the re-domiciling of investment funds more generally.

Finance Bill 2010 builds on Finance Minister Brian Lenihan's commitment in his Budget speech on 19th December 2009 to "strengthen Ireland’s competitive edge" in the investment funds sector and to develop Ireland as a "European hub for the international funds industry".