1. Introduction

Introduction

The development of the international financial services industry has been a major success story for Ireland since its inception in the mid-1980s. Asset management and funds servicing have played a critical role in the expansion of this sector in Ireland. Ireland’s reputation for excellence in financial services means that we are well placed to capitalise on this offering so as to ensure continued success that will realise tangible benefits to Ireland and its citizens. 

To ensure that Ireland’s financial services sector is and remains resilient, future-proofed and a continued example of international best-practice, the Minister for Finance, Michael McGrath T.D. announced a review of the funds sector on 6 April 2023. The Terms of Reference of the Funds Sector 2030 Review (“the Review”) can be found in Appendix 1 to this Public Consultation Paper (“the consultation paper”). The Department of Finance (“the Department”) will conduct the Review and report to the Minister for Finance in summer 2024.

The Department is conducting a wide-ranging review of the funds sector under the broad and interlinked themes of “Open Markets, Resilient Markets and Developing Markets”. Key objectives include developing a framework within which Ireland can maintain its leading position in fund management and fund servicing and ensuring that the sector continues to support economic activity both at the regional and national level in Ireland.

The Review will also seek to ensure that the funds sector in Ireland is resilient and that the regulatory and supervisory frameworks are future-proofed, supportive of macro-prudential stability, investor protection and consistent with international best-practice standards. Broader international developments, such as the advancement of the EU Capital Markets Union (CMU) initiative, also support the view that it is timely to examine Ireland’s funds sector and, where possible and appropriate, provide guidance on how best to navigate future changes.

The Review will take account of the relevant commitments contained in the Programme for Government; the relevant recommendations of the Commission on Taxation and Welfare (COTW); and the recommendations of the IMF Financial Stability Assessment Programme (FSAP).

The Department has established a dedicated team to conduct the Review. In publishing this consultation paper, the team aims to gather information from, and perspectives of, a wide range of stakeholders, including members of the public. This engagement is critically important given that the issues being dealt with as part of the Review may have a significant impact on, and consequences for, a wide range of stakeholders, both domestically and internationally.  

The deadline for the public consultation is 15 September 2023. This will be followed by targeted stakeholder engagement in late 2023 and into 2024, utilising the insights from the public consultation. Further consultations may also be necessary at a later stage in the Review. 

This consultation covers a wide range of topics reflecting both the Terms of Reference of the Review and the complex and multi-faceted nature of the funds sector.

For the purpose of the consultation paper, the Terms of Reference have been split into the following sections:

• Section 2: Investment funds and asset management landscape
• Section 3: The regulatory and supervisory framework
• Section 4: Assessing the impact of the funds sector
• Section 5: Taxation of investment products
• Section 6: The role of the REIT and IREF regimes in the Irish property market
• Section 7: The role of the Section 110 Regime