The Exchange Traded Funds (ETFs)
were launched at the level of the European Union (EU) in 2000. Since then, Ireland became the dominant market for the domiciliation of such investment funds
, as approximately 50% of all the ETFs
set up in the EU are registered in Ireland
. The ETFs
are addressed to professional investors
, as they can carry out investment policies on the stock market
. Our team of Irish lawyers
can offer legal assistance for the registration of an ETF
in accordance with the investment plans
of the businessmen.
What is an exchange traded fund?
The exchange traded fund
is a type of investment fund
which can own underlying assets such as stocks, bonds, gold bars or foreign currency
. In an EFT
, the shareholders divide the ownership of such assets into shares. According to the applicable legislation in Ireland
, an EFT
can be set up as an alternative investment fund (AIF)
or as undertakings for collective investment in transferable securities (UCITS)
It is important to know that UCITS
are the preferred investment vehicles
in the case of the European small investors, a trend which is also available in Ireland.
are very popular because they provide a high level of protection for the investors
and solid regulations for risk management strategies; our law firm in Ireland
can offer more details on the UCITS regulations
ETFs registered as an UCITS in Ireland
The ETFs which are registered as UCITS can be set up as one of the following:
• corporate vehicles;
• trust vehicles.
Furthermore, an ETF allows the registration of multiple sub-funds (umbrella funds), which provides the opportunity to conduct several investment strategies at the same time.
Taxation of Irish ETFs
Since the ETFs are collective investment funds
, the taxation
of such entities is performed following the regulations of the Tax Consolidation Act.
In the situation of ETFs registered in Ireland
, incomes and other gains are taxed following a self-assessment tax return submitted by the investors, which is applicable at the rate of 41%.