Qualifying investor alternative investment fund

In 2018, the Central Bank of Ireland expanded the Loan Originating QIAIF or L–QIAIF regime which enables the five tax-free structures to be used for closed-end debt instruments.

The L–QIAIF is Ireland's main debt–based BEPS tool as it overcomes the lack of confidentiality and tax secrecy of the Section 110 SPV.

[24] Ireland is considered by some academic studies to be a major tax haven, and offshore financial centre, with a range of base erosion and profit shifting ("BEPS") tools.

[1][34] In February 2018, the Central Bank of Ireland changed its AIF "Rulebook" to allow L–QIAIFs to hold the same assets that Section 110 SPVs could own.

[39][40] The QIAIF regime has contributed to making the International Financial Services Centre (IFSC) one of the largest fund domiciling and shadow banking locations in Europe.

However, fund structuring is a competitive market and other corporate tax havens such as Luxembourg offer equivalent products.

[50] The launch of the Irish ICAV was widely covered, and praised, by the leading offshore magic circle law firms,[12] the largest of which, Maples and Calder, claimed to have been one of its chief architects.

[51][e] This risk of QIAIFs was highlighted in 2014 when Central Bank of Ireland consulted the European Systemic Risk Board ("ESRB") after initial, and unsuccessful, lobbying by IFSC tax-law firms to expand the L–QIAIF regime, so as to remove Irish taxation from Irish loan investments.

Central Bank of Ireland ("CBI") regulates QIAIFs. When Irish public tax scandals concerning the Section 110 SPV , also regulated by the CBI, emerged in 2016–2017, the CBI upgraded the little-used LQIAIF, [ 1 ] to give the same benefits as Section 110 SPVs, but with full confidentiality and tax secrecy. [ 2 ]
Stephen Donnelly TD uncovered abuses of Section 110 SPVs in 2016, and warned that making commercial property tax-free to foreign investors, via QIAIFs, would cause an office bubble and a housing crisis. [ 30 ] [ 31 ]
Comparison of the sales price as multiple of the cost of build, for a prime office in Dublin, with EU–28 countries (2016).
Comparison of the sales price of Dublin prime office with EU–28 countries (2016).