TThe soon to be introduced Financial Conglomerates Directive will require large financial groups to establish holding companies with head offices in the European Economic Area (EEA). And with the recently introduced holding company regime, Ireland should be a key contender to win this business.
The Directive, which must be transposed into Irish law by August 11th, 2004, for application post January 1st, 2005, is aimed at addressing a loophole with regards to the supervision of large financial groups, and its principle purpose is to ensure that financial conglomerates have sound capital adequacy policies that address the specific profile of the Group as a whole.
For companies with their parent groups outside the EEA, the group may be required to establish a holding company which has its head office in the EEA.
Writing on page 2, Kevin Allen, a partner with A&L Goodbody, says that this provision is interesting in light of the recent changes to Irish tax law made in the Finance Act 2004, which made Ireland a more attractive location for holding companies. He says that it provides an opportunity for Ireland in respect of attracting such holding companies, and will put Ireland firmly in the short-list of jurisdictions being considered as a location for financial conglomerate holding companies.
See also page 2. |
