International Accounts Q1 2024 Final

Background

Increasingly, for highly globalised countries such as Ireland, it is important to account for globalisation effects in data. These Redomiciled PLCs have, as previously illustrated, significant impacts in some of our statistical outputs. In order to account for these impacts, it is important to separate those figures which are influenced by these Redomiciled PLCs and illustrate which data is reflective of firms that are native to Ireland i.e. those firms which have originated here.

While in CSO publications, we refer to these firms as Redomiciled PLCs, international organisations have termed the concept “corporate inversion”. The OECD’s BPM6 manual defines a corporate inversion as “corporate restructuring of a transnational enterprise group such that the original parent company in one economy becomes a subsidiary of the new parent in another economy. In addition, ownership of a group of enterprises may be shifted to the new parent company.”

Beginning in 2008, in reaction to proposed changes to corporate tax rates in the United Kingdom and the United States, a number of multinational corporations relocated their group headquarters to Ireland. Since that year, there have been additional firms that have relocated while some opted to leave.

In 2023 the net income of redomiciled PLCs was €8.3bn. Figure 6.1 shows the effect of the net income of redomiciled PLCs in the balance of payments primary income figures. Users often refer to primary income as the repatriated profits of multinationals based in Ireland. This group of PLCs reduce that outflow in the balance of payments as shown in Figure 6.1.