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Migrating SPVs from CREST

Ireland is the leading European jurisdiction for Special Purpose Vehicles or SPVs.

Representing 24% of the European industry with some 1400 issuances, this dominance has left the country being seen as a world leader when it comes to determining and defining industry best practice.

In Ireland, SPVs are required and used by a cross-section of the international financial services sector; investment funds, the aircraft leasing sector and insurance companies use Section 110 companies to hold certain types of assets as part of their risk management strategies.

There are three  key reasons why Ireland has found itself as a popular location for establishing SPVs. The country has a raft of double taxation treaties in place – 73 are currently in effect and this number continues to grow. Furthermore, as a member of both the EU and the OECD, the country is considered on-shore, is a common law jurisdiction, has a highly regarded  legal and regulatory regime and thirdly, special tax treatments are available for Irish SPVs.

Historically, Irish SPVs would be settled in CREST, however from March 2021, international issuers will have the option to use an Irish SPV to gain direct access to Euroclear, benefitting from settlement on almost any global CSD.

Euroclear already connects six European CSDs, making them the largest group of CSDs and offering the highest levels of safety combined with a truly international reach. Furthermore, every six days, Euroclear settles transactions with a value equivalent to the GDP of the whole EU. Euroclear settlement also allows the best access to liquidity through ensuring the optimal use of issuer assets.

Regardless of the migration from CREST to Euroclear, Ireland will continue to offer International Issuers of securities a robust, common Law framework for the issuance of Debt, Equity and other asset class securities.  Avenir will be in position to assist issuers in both setting up the Irish Register as well as to dematerialise their new issuances into the Euroclear framework.

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