Nat O'Connor: A article in the Financial Times states that the Government is seeking to attract hedge funds to Ireland.
Dublin to open door for hedge funds (19 December 2009): "The Irish government has passed legislation to make it easier for hedge funds based in the Cayman Islands and other tax havens to move to Dublin."
The new legislation reportedly "cuts red tape to a minimum" in terms of moving companies to Ireland.
The Minister for Finance is quoted as saying that the finance bill early next year to will "strengthen Ireland's competitive edge in this important sector".
Howver, the FT states that many investors are looking for hedge funds to be more tightly regulated. Billy Kelleher, Minister of State for Trade and Commerce, is quoted as saying that "Funds are looking for stronger oversight, and better regulation, and we believe Ireland has that in spades."
Patrick Honohan, Governor of the Central Bank in a speech (1 Dec 2009) has written that "I will certainly not allow Ireland to become a soft option for firms or activities that are no longer welcome elsewhere."
However, Honohan concludes "the primary onus for sound operation must fall on the directors and management of the banks themselves. They must renew and reform their business models and culture to ensure that a recurrence of such a collapse becomes unthinkable. As has been suggested by one former regulator abroad, a watchword for supervisors in the new era must be: trust less, verify more."
How is this different from what has gone before? Is Irish banking regulation really tightening up? And can it be tight enough (and expert enough) to regulate an influx of hedge funds?
Dr Nat O'Connor @natpolicy
Dr Nat O’Connor is Assistant Professor of Social Policy at UCD, a fellow of the UCD Geary Institute for Public Policy and former Director of TASC. Nat also previously worked at Age Action, the Labour Party, Ulster University and the Homeless Agency. You can find him on LinkedIn (natoconnor) and TwitterX @natpolicy.
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