As we move towards a more global and knowledge-based economy Intellectual Property (IP), as an economic resource, and its protection, is becoming of increasing importance. It is widely accepted that IP protection stimulates innovation, contributes to economic growth and increases business activity. An integral part of international trade, IP has become increasingly important to the continued success of the Irish economy and its attractiveness for Foreign Direct Investment (FDI) by Multi-National Companies (MNCs).
It is widely accepted that IP plays a vital role in promoting innovation and stimulating the economy to foster growth. Consequently, it is vital that appropriate policies and procedures are in place to ensure that Ireland remains an attractive location for investors looking to set up their operations in Europe. Ireland offers a low corporation tax rate (12.5%) and provides significant tax incentives for companies exploiting IP. IP protection is considered one of the key factors taken into account by potential inward investors to Ireland.
IP is a valuable asset and, as a consequence, the subject of both abuse and infringement. As Ireland moves towards a more global knowledge based economy, the importance of IP and its protection will be fundamental in the attraction of FDI to Ireland.
Ireland continues to make significant efforts to stimulate innovation, and encourage Research and Development (R&D) activities to further increase the country’s attractiveness as a location for FDI. The Irish government has been proactive in its efforts to encourage R&D, ensuring that Irish IP laws are kept relevant and up-to-date.
The IP regime is now at a stage of major change, both locally and in the EU, across many areas, including the:
- new pan Europe patent right and Unified Patent Court (UPC) regime;
- proposed amendments to the Copyright and Related Rights Act;
- changes to trademark protection;
- proposed EU directive on trade secrets; and
- enactment of legislation on plain packaging.
The Irish Government Budget for 2015 announced that the well-known ‘Double Irish' tax mechanism is being phased out by 2020 but will be replaced by a number of initiatives to ensure Ireland’s continued attractiveness as an FDI destination. As competing countries lower their corporation tax rates (for example, the UK is reducing their rate from 20% to 18% by 2020, with a 1% interim cut in 2017), Ireland will need to work harder to maintain its competitiveness.
One of the possibilities being advanced relates to the provision of further benefits and tax incentives to IP intensive companies through a so-called Knowledge Development Box (KDB) regime.
At the same time, Ireland continues to strive to improve its IP protection in the legal regime and enforcement. It was announced in November 2014 by the Minister for Jobs, Enterprise and Innovation that Ireland will establish a local division of the UPC, subject to the international agreement on a UPC being ratified.
In addition, as the Transatlantic Trade and Investment Partnership (TTIP) negotiations progress, the topic of IP protection continues to be at the forefront of the debate. This report considers and assesses the strengths and weaknesses of the current Irish IP regime and will assess the opportunities and threats offered by the new proposals, such as the Knowledge Development Box (KDB) and the impact that the introduction of plain packaging has on Ireland’s perception as a strong supporter of IP protection.