IRELAND
Summary
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Sanctions

None

FAFT AML Deficient

No

Medium Risk Areas

US Dept of State Money Laundering Assessment

 

 

ANTI-MONEY LAUNDERING

 

FATF Status

Ireland is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

 

Compliance with FATF Recommendations

Since the adoption of its mutual evaluation report in 2006, Ireland has focused its attention on:

Strengthening the AML/CFT legislative framework with the enactment of the Criminal Justice (Money Laundering and Terrorist Financing) Act 2010 and the Criminal Justice Act 2013. Among other provisions, they address:

Customer due diligence provisions and other preventive measures, which have been brought into line with the FATF Recommendations.

Expanding the scope of the Act by including Trust and Company Service Providers, private members' gaming clubs and barristers.

Enhancing a range of measures that are designed to prevent the financial and other sectors from being misused by criminals.

Issuing Guidelines on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing to expand on the provisions of the primary legislation.

In June 2013, the FATF recognised that Ireland had made significant progress in addressing the deficiencies identified in the 2006 mutual evaluation report and could be removed from the regular follow-up process. The decision by the FATF to remove a country from the regular follow-up process is based on procedures agreed in October 2009.

 

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.

 

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SANCTIONS

There are no international sanctions currently in force against this country.

 

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BRIBERY & CORRUPTION

 

Index

Rating (100-Good / 0-Bad)

Transparency International Corruption Index

73

World Governance Indicator – Control of Corruption

92

 

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INVESTMENT CLIMATE - Executive Summary (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. Other factors cited by foreign firms include: the quality and flexibility of the English-speaking workforce, availability of a multi-lingual labor force, cooperative labour 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 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 EU 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 (SOE) 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 since 1950. The two countries also share a Tax Treaty from 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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FURTHER REPORTS

IMF Report: Ireland: Financial System Stability Assessment (July 2016)

Ireland has made significant progress since its last AML/CFT assessment. It has substantially addressed the main deficiencies identified in its 2006 Mutual Evaluation Report (e.g., with respect to the ML offense and customer due diligence measures), and disseminated good AML/CFT practice by publishing relevant guidelines. It has sought to facilitate the recovery of proceeds of crime (e.g. by reversing the burden of proof in certain circumstances), and prohibited bearer shares. It has implemented most of the AML/CFT recommendations made by the Fund in the context of the 2013–14 assessments of Ireland’s observance of supervisory standards. Onsite and offsite inspections in 2013/14 revealed that the banking and credit unions sectors were not adequately assessing and mitigating ML/TF risks. As a result, the Central Bank has taken a number of general and individual actions to enhance compliance with AML/CFT requirements.

Ireland is in the process of bringing its AML/CFT framework in line with the 2012 FATF standard, notably with respect to the assessment of its ML/TF risks and transparency of legal persons and trusts. The authorities established the Anti-Money Laundering Steering Committee to facilitate domestic cooperation and conduct Ireland’s first Money Laundering and Terrorist Financing National Risk Assessment in 2016 (ahead of Ireland’s November 2016 assessment against the current standard). Ireland is also taking steps to implement, by June 2017, the European Commission’s 4th Directive on Money Laundering, which notably seeks to ensure timely access by competent authorities to beneficial ownership information of legal persons, and extend the definition of politically-exposed persons. The authorities are encouraged to pursue their efforts to implement the revised standard in an effective way, and to implement the recommendation of the 2014 ICP assessment to empower the Central Bank to issue enforceable rules in this area.

Read Full Report

 

Group of States against Corruption (GRECO) publishes third round compliance report on Ireland  -  Conclusions (December 2011)

With respect to Theme I – Incriminations , the Prevention of Corruption (Amendment) Act was adopted, in December 2010, with a view to strengthening legislation relating to the prevention of corruption and enhancing its consistency and clarity. Key provisions refer to whistleblower protection, the extension of extraterritorial jurisdiction for corruption offences, a revision of the main corruption offence to clarify that both material and immaterial advantages are covered, the widening of the range of foreign public officials coming within the scope of legislation (i.e. persons under the direct or indirect control of a foreign national, regional or local government and members or staff of international organisations), and the application of corporate liability also with respect to unincorporated bodies. Other key legislation recently adopted in this area include the Criminal Justice Act, as well as the Criminal Justice (Money Laundering and Terrorist Financing) Act. Ireland lodged its instrument of ratification of the United Nations Convention against Corruption (UNCAC) in November 2011. Further reform is still expected to occur as part of the new Programme for Government (2011-2016), which
specifically lists among its priorities the enactment of a new anticorruption law. GRECO is hopeful that, in the context of the ongoing reform, due attention will be paid to the criminalisation of trading in influence as an autonomous offence, in line with Article 12 of the Criminal Law Convention on Corruption (ETS 173).

In relation to Theme II – Transparency of Party Funding , GRECO is pleased that Ireland has engaged in a reform process, where most concerns raised by GRECO in its Third Evaluation Round Report are being taken on board. In particular, the General Scheme of the Electoral (Amendment) (Political Funding) Bill 2011, currently undergoing public consultation, would, if adopted, appear to address a large majority of the recommendations raised by GRECO. The new accounting and auditing obligations for political parties, as well as the measures introduced to increase transparency of corporate donations are of particular relevance. The authorities are encouraged to pursue their efforts to further strengthen transparency and openness of political finances. In the context of the ongoing reform, more attention must be paid to the consolidation of party accounts so that they are able to provide meaningful financial information pertaining to local branches and third parties, the oversight performed at local level, and the sanctioning regime.

In the light of what has been stated in the above paragraphs, GRECO notes that Ireland has been able to demonstrate that reforms with the potential of achieving an acceptable level of compliance with the pending recommendations within the next 18 months are well underway. GRECO therefore concludes that the current low level of compliance with the recommendations is not “globally unsatisfactory” in the meaning of Rule 31, paragraph 8.3 of the Rules of Procedure. GRECO invites the Head of the delegation of Ireland to submit additional information regarding the implementation of recommendation ii (Theme I – Incriminations) and recommendations i, ii, v to vii (Theme II – Transparency of Party Funding) by 30 June 2013 at the latest.

Read Full Report (pdf file)


OECD:  Ireland must urgently apply more resources to enforce Anti-Bribery Convention (December 2013)

Extract:

To improve Ireland's fight against foreign bribery, the Group recommends that Ireland:


Urgently reorganise law enforcement resources to ensure credible foreign bribery allegations are investigated and prosecuted;
Consider how to apply cost-effective and simple detection and investigative steps at the earliest opportunity to more actively enforce Ireland's foreign bribery offence;
Proceed with its reform of anti-corruption legislation and use this opportunity to consolidate and harmonise inconsistencies between Ireland's two foreign bribery offences that could be obstacles to effective enforcement, and review, on a high priority basis, Ireland’s law on corporate liability for foreign bribery; and
Harmonise the confusing plethora of legal provisions on whistleblower protections, to encourage reporting of foreign bribery allegations.

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