IFS2020 A Strategy for Ireland’s International Financial Services sector 2015-2020

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Progress Report

Q4 2018

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Table of Contents

Foreword ..................................................................................................................................... 2

Progress Report ........................................................................................................................... 4

Strategic Priority 1: Promote Ireland as a location for International Financial Services & world class innovative products & services ..................................................................................................... 7

Strategic Priority 2: Drive continuous improvement in the operating environment & competitiveness of Ireland's IFS sector ....................................................................................... 12

Strategic Priority 3: Drive Research, Innovation & Entrepreneurship in the IFS sector, with a particular focus on financial technology & governance, risk & compliance ................................... 16

Strategic Priority 4: Develop job-creation opportunities from emerging IFS sub-sectors & new markets ……………………………………………………………………………………………………………………………………..18

Strategic Priority 5: Implementation Framework for IFS2020 ....................................................... 22

Appendix 1: Monitoring Dashboard ......................................................................................... 23

Appendix 2: Glossary of Terms ................................................................................................ 26

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Foreword I am pleased to introduce this progress report documenting the implementation of the IFS2020 Strategy, the Government’s strategy for Ireland’s international financial services (ifs) sector. This is the fifteenth IFS2020 update. It outlines progress made on the measures contained in the 2018 Action Plan during quarter 4 2018 (October-December). I am pleased to say that, 27 of the 30 measures due for completion

in Quarter 4 have been successfully completed on time. The first delayed measure is measure no. #10 “promote regional locations for second site operations to support growth by ifs companies located in or near Dublin”. Two showcase events were planned for 2018. However only one showcase event was held. This event took place in the Waterford Institute of Technology. The second showcase event was deferred until 2019 due to the number of important regional events and road shows ongoing during Q4, particularly in response to Brexit. The second delayed measure is measure no. #37, which concerns the development and delivery of a programme that addresses the specialised educational requirements relating to alternative investment structures. A suitable programme has been developed. However, despite a promotional campaign, demand has not been sufficient to make the programme viable at this time. The third delayed measure is measure no. #39. This is a paper on the review of the use of debt/equity hybrid instruments by SMEs. This paper is due to be published later in 2019. In Quarter 4 the IDA Board approved a number of strategic investments. These included a mix of new name clients opening new European operations in Ireland and investments that capitalise on the available talent in Ireland. Announcements during the quarter included the opening of a new office in Ireland by the crypto technology exchange Coinbase and the authorisation in principle for AXA XL to move XL Insurance Company SE to Ireland from the UK. In October, audit, tax and advisory firm Mazars officially opened its new Galway office and announced that it will create up to 30 new jobs over three years of which 20 will be in its recently created internationally-focused, outsourced accounting services centre and builds on the firm’s existing outsourced business unit which is based in Dublin. Preparations have continued for the European Financial Forum on 13 February 2019. In Quarter 4, a number of high profile speakers were confirmed for the 2019 Forum including Clare Woodman (Head of EMEA and CEO, Morgan Stanley &Co); Yves Choueifaty (President and Chief Information Officer, Tobam); Fiona Gallagher (Managing Director, Global Head of Securities Services and Chief Country Officer for Ireland, Deutsche Bank) and Andrew Douglas (Managing Director, Government Relations and Chief Executive Officer, DTCC’s European Trade Repository). In the 2018 IFS2020 Action Plan I identified the continued promotion of green and sustainable finance as a priority area for action. In Q4 the Climate Innovation summit was held from 6-8 November as part of the wider climate week Ireland. Over 1,000 people attended 50 events with 80 world-class speakers. Among the highlights of the Summit were the launch of Ireland’s first responsible state of play report and the launch of the Sustainability Skillnet

MoS

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Programme for 2019. Green and sustainable finance masterclasses were held during Climate Week Ireland, 5–9 November. In partnership with the Irish Chartered Society of Actuaries, a masterclass on environmental, social and governance (ESG) was held. In partnership with Insurance Ireland, an ESG masterclass for the insurance sector is being developed.

We are now moving towards 2019 the last year of the IFS2020 Strategy. In my Q3 quarterly report I said that work had commenced on a successor strategy to IFS2020. In Q4 a public consultation on the successor strategy was carried out. I would like to take this opportunity to thank those who responded to the public consultation. Work on the new strategy has continued in Q4 on the basis of the responses received in the public consultation process and other consultations with stakeholders. It is planned that the new strategy will be launched in 2019. The new strategy will build upon our existing financial services foundation and drive the sector into new and emerging areas focusing on high quality investments to ensure the IFS sector continues to move up the value chain in an increasingly competitive global market for financial services.

Michael D’Arcy TD Minister of State for Financial Services and Insurance Chair of the IFS2020 Joint Committee

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Progress Report

Table 1 Monitoring Dashboard – Measures for Delivery in Q4 2018

M Title Lead Deadline Q4

Strategic Priority 1 - Promote Ireland as a location for IFS & world class innovative products and services

1 A public sector financial services sub-group to engage with the Cabinet Committee on Brexit

D/FIN Quarterly

2 Further progress co-ordinated IFS messaging

IDA, EI and Comms Subgroup

Quarterly

3 Promote and market Ireland as a location for foreign direct investment (FDI) to international financial services (IFS) firms

IDA Quarterly

4 Strategic promotion and marketing of Ireland’s IFS sector overseas under the IFS Ireland banner brand:

a. Overseas trade missions

b. Shared IFS calendar

c. Ministerial and other official visits

d. Banner brand – public sector e. Banner brand – industry

f. International marketing materials

D/FAT, D/BEI D/FAT EI, IDA, D/FAT IDA, EI IAC Comms sub-group, IDA, EI

Quarterly Quarterly Quarterly Quarterly Quarterly Quarterly

7 Host an event in London to highlight the many advantages Ireland has for carrying on international insurance-related activities

Insurance Ireland Revised deadline Q4 2018

9 Insurance Ireland to update its Jurisdictional Promotion Brochure produced in partnership with IDA under the title “Ireland for Insurance”

Insurance Ireland Revised deadline Q4 2018

10 Promote regional locations for second site operations to support growth by IFS companies located in or near Dublin

EI, IDA Q4 2018

12 Present and update quarterly economic data on IFSIreland.com

PSCG, Comms sub-group

Quarterly

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M Title Lead Deadline Q4

Strategic Priority 2 – Drive continuous improvement in the operating environment and competitiveness of Ireland’s IFS Sector

13 Ireland as a global location for private equity funds management

D/FIN Q4 2018

14 Engage at EU level on proposals in relation to the regulation of crowdfunding

D/FIN Q4 2018

15 EU legislative / Regulatory Proposal Industry Representatives

Quarterly

16 Continue to monitor the skills needs of IFS industry and stakeholder engagement on education and skills

D/ES Q4 2018

17 Liaise and inform regarding changes to Ireland's network of double taxation agreements

D/FIN Q4 2018

19 Deliver a Master's degree course in International Law

D/ES Q4 2018

22 IFS Apprenticeship Programme D/ES Q4 2018

Strategic Priority 3 – Drive research, innovation & entrepreneurship in the IFS sector, with a particular focus on financial technology & governance, risk & compliance

27 Tender for research services to benchmark payments in Ireland

D/FIN Q4 2018

29 Promote and ensure market diversity with priority given to fintech & payments in well-defined markets

EI Quarterly

30 Provide dedicated fund for fintech start-ups EI Q4 2018

Strategic Priority 4 – Develop job-creation opportunities from emerging IFS sub-sectors and new markets

31 Co-host the European Climate Innovation Summit in Dublin in November 2018

Sustainable Nation Ireland

Q4 2018

32 Develop training programmes in climate risk and opportunity supported by Sustainability Skillnet

Sustainable Nation Ireland

Revised deadline Q4 2018

33 The Irish Strategic Investment Fund (ISIF) will co-invest in suitable private sector proposals with a particular focus on asset management and financial technology

ISIF, IDA, EI Q4 2018

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M Title Lead Deadline Q4

34 Continue to engage at EU level on proposals for an EU Regulation on a pan-European Personal Pension Product (PEPP)

D/FIN Quarterly

36 Engage at EU level on Sustainable Finance proposals

D/FIN Quarterly

37 Develop and deliver a programme that addresses the specialised educational requirements relating to alternative investment structures

D/ES Revised deadline Q4 2018

38 Engage with EU Institutions on the EU Covered Bonds Directive proposal and represent Irish position at subsequent negotiations

D/FIN Q4 2018

39 Review and assess the situation in relation to the use of debt/equity hybrid instruments by SMEs

D/FIN Revised deadline Q4 2018

40 Continue to monitor developments in relation to equity finance for SMEs

D/FIN Q4 2018

41 Identify areas for further IFS-related actions through engagement with the Regional Action Plan stakeholders

D/BEI Q4 2018

42 Update on developments in relation to financial markets infrastructures

D/FIN Q4 2018

Strategic Priority 5 – Implementation framework for IFS2020

43 Secretariat for Joint Committee D/FIN Quarterly

Legend

Measure delayed Measure at risk of being delayed Measure on track

Measure Complete

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Strategic Priority 1: Promote Ireland as a location for International Financial Services & world class innovative products & services This strategic priority focuses on enhancing Ireland’s standing and reputation as a location for, and producer of, international financial services and products, including innovative financial technologies. IFS2020 provides the context for a more strategic and coordinated approach to promoting, marketing and branding Ireland’s IFS sector internationally, leveraging the expertise and international reach of departments, state agencies and our embassy and consulate network, in conjunction with industry stakeholders.

Table 2 Strategic Priority 1: Promote Ireland as a location for IFS

Status at Q4 2018

M#1 A public sector financial services sub-group to engage with the cabinet committee on Brexit

Q4 2018 Update:

The sub-group continues to work on Brexit in terms of bilateral engagements with relevant stakeholders. The subgroup met on 18 December 2018.

Measure on Track

M#2 Further progress co-ordinated IFS Messaging

Q4 2018 Update:

The Communications Subgroup of the Public Sector Coordination Group has met regularly over the Q4 period with its work concentrating on the following:

The IFS messaging pack (previously messaging deck) was reformatted and updated for Q4. Content was reduced and streamlined, with a focus on providing the key messages relating to Ireland and IFS, living in Ireland, investing in Ireland and the overall business environment. This messaging pack has been published on IFSIreland.com and the IFS2020 section of the Department of Finance website. Feedback on the Q4 messaging pack has been positive to date.

Work is ongoing on updating the IFS brochure, with all stakeholders contributing.

The subgroup is developing a communications and messaging strategy to promote the European Financial Forum 2019. This includes a one-page brief which will be updated and circulated weekly. The work of the subgroup and the frequency of meetings will be kept under review during the run up to the European Financial Forum 2019.

Measure on Track

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M#3 Promote and market Ireland as a location for foreign direct investment (FDI) to international financial services (IFS) firms

Q4 2018 Update:

The IFS Division of IDA Ireland was active in all target markets during Q4 2018. Signature events overseas that took place during the quarter, where IDA attended and exhibited, included SIBOS in Sydney, Money2020 in Las Vegas, and the Irish Funds Conference in London. In addition, there was an active programme of bilateral meetings with companies with a particular focus on promoting Ireland as a location for technology operations alongside new or existing regulated entities.

During the last quarter of the year, the IDA Board approved a number of strategic investments. These include a mix of new name clients opening new European operations in Ireland in response to Brexit, and investments that capitalise on the deep pool of talent available in the IFS ecosystem.

Announcements during Q4 2018 included the opening of a new office in Ireland by the Crypto technology exchange Coinbase and the authorisation in principle for AXA XL to move XL Insurance Company SE to Ireland from the UK in advance of 29 March 2019. There were also a number of office openings by high-profile IFS companies that selected Ireland as the location for post Brexit operations.

Relevant industry representative bodies distributed the IFS messaging deck to their members.

Measure Complete

M#4 Strategic promotion and marketing of Ireland’s IFS sector overseas under the IFS Ireland banner brand

Q4 2018 Update:

Minister for Finance, Paschal Donohoe T.D., delivered a speech at a Financial Services Ireland regional event, which focused on the positive impact of the financial services sector in Dublin City.

The Minister of State at the Department of Finance for Financial Services and Insurance, Michael D’Arcy T.D., attended the Enterprise Ireland Financial Services Dinner hosted in the Irish Embassy in London and events in Edinburgh organised by the Scottish–Irish Finance Initiative (SIFI).

The Department of Foreign Affairs and Trade supported a number of other IFS related events including:

The Ambassador to Vietnam met with Irish nationals working with major Vietnamese investment firms to exchange views on opportunities for Irish businesses in Vietnam.

Measure on Track

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Embassy Tokyo supported the visit of IDA CEO, Martin Shanahan, who was in Japan for 3 days of client meetings. This included a working dinner with senior representatives of 12 leading Japanese corporations, including firms from the IFS sector.

Ambassador-Designate to Indonesia, along with officials from the Department of Finance, attended meetings of the International Monetary Fund (IMF) and the World Bank Group in Bali in October.

Embassy Singapore, in association with Enterprise Ireland, the Irish Chamber of Commerce and IDA Ireland, organised and hosted a roundtable event and networking reception for over 30 top executives in the banking, funds and fintech sectors on the occasion of the visit of the Governor of the Central Bank, Philip Lane, to Singapore.

Consul General Boston attended an Irish Funds seminar reception and delivered an address to over 100 fund industry C-suite representatives on the Irish funds economy, Brexit and investment opportunities.

Consul General Shanghai attended the opening of new offices of Irish fintech company Planet in Shanghai. The speech by the Consul General emphasised the competitive advantages of financial services, particularly fintech, in Ireland.

Enterprise Ireland’s overseas offices continued to support the promotion of Ireland’s financial services companies and representative bodies in their territories working across all main regions with companies at all stages of development.

Enterprise Ireland events during this quarter in the UK, Australia, Hong Kong, Shanghai, Singapore and Bangkok, all included use of the IFS Ireland banner brand.

Enterprise Ireland hosted a fintech forum at its International Markets Week in October. This event, the only specific sector-focused event, provided an opportunity for Enterprise Ireland Market Advisors from around the world to meet with CEOs from fintech and financial services client companies from all over Ireland. Minister of State D’Arcy provided a keynote address which was followed by a discussion with panellists from the Department of Finance, Central Bank, Insight Research Centre, and EI Hong Kong.

M#7 Host an event in London to highlight the many advantages Ireland has for carrying on international insurance-related activities

Q4 2018 Update:

Insurance Ireland held its first Jurisdictional Insights Event with IDA Ireland in London on November 6th with more than 90 attendees. The event focused on the strong ties between the Irish and UK insurance sectors and how this complementary relationship will develop into the future. In

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addition, the practical considerations for companies looking at establishing in Ireland were discussed, including the availability of talent and the authorisation process.

Measure Complete

M#9 Insurance Ireland to update its Jurisdictional Promotion Brochure produced in partnership with IDA under the title “Ireland for Insurance”

Q4 2018 Update:

Insurance Ireland published its updated Jurisdictional Promotion Brochure under the title “Ireland for Insurance” in Q4 2018. The brochure was launched at Insurance Ireland’s European Insurance Forum on October 24th where it was distributed to more than 340 guests. It was also distributed to all guests at the Insurance Ireland-IDA jurisdictional insights event in London on November 6th. The document is available on the Insurance Ireland website at:

www.insuranceireland.eu/news-and-publications/publications/insurance-ireland-jurisdiction-brochure-2018

Measure Complete

M#10 Promote regional locations for second site operations to support growth by IFS companies located in or near Dublin

Q4 2018 Update:

Enterprise Ireland’s regional teams continued their ongoing efforts to promote regional locations for IFS companies. A number of small IFS events were held in regional locations including Cork, Galway, Kerry and Waterford. A regional showcase event was held in the Waterford Institute of Technology which brought together a group of fintech and regtech start-ups and research groups and established companies from the region. Enterprise Ireland and IDA Ireland have also supported a number of existing clients in developing private itineraries to visit potential second-site locations around the country.

Due to the number of important regional events and roadshows ongoing during the period, particularly in response to Brexit, a decision was taken to defer the second IFS showcase event into 2019.

The sale of the Wicklow fintech business PerfectCard to the Australian payment solutions firm EML in July is to result in new jobs for Galway, which will become EML’s global innovation hub. Following investment from Enterprise Ireland, Pipit Global, a Galway-based start-up focusing on international cash transactions for the underbanked, has grown its team from 3 to 13. Both of these companies are operating from the Portershed innovation hub in Galway city.

In October, audit, tax and advisory firm Mazars officially opened its new Galway office and announced that it will create up to 30 new jobs over a three-year period, doubling the headcount of the office to 60. Some 20 of these new positions will be in its recently created internationally-focused, outsourced accounting services centre and builds on the firm’s existing outsourced business unit which is based in Dublin.

Measure delayed

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M#12 Present and update quarterly economic data on IFSIreland.com

Q4 2018 Update:

IDA Ireland and the Department of Finance have collated data from relevant sources and this data has been updated on the IFSIreland.com website.

Measure on Track

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Strategic Priority 2: Drive continuous improvement in the operating environment & competitiveness of Ireland's IFS sector

This strategic priority focuses on the importance of improving Ireland’s standing as a competitive location for innovative IFS companies. It covers a broad range of issues, including education and skills; promotion of IFS as a career option for young people; promotion of Ireland as an attractive location for mobile international talent; promoting the regional dimension of Ireland for IFS; developing the business environment for IFS, including the regulatory, and infrastructure arrangements.

Table 3 Strategic Priority 2 Operating environment & Competitiveness

Status at Q4 2018

M#13 Ireland as a global location for private equity funds management

Q4 2018 Update: Updating of the Investment Limited Partnership Act 1994 is ongoing. Drafting is underway

Measure at risk of

being delayed

M#14 Engage at EU level on proposals in relation to the regulation of crowdfunding

Q4 2018 Update:

There have been four working party group meetings in Brussels on the proposed regulation of crowdfunding service providers. The latest one took place on 18th December 2018 and another meeting is expected to be scheduled for March 2019.

Written comments on the proposed regulation and on questions arising out of a Presidency Non-Paper have been provided, setting out Ireland’s position in respect of the proposed European regulation. There has also been engagement with the Central Bank of Ireland in formulating the position put forward.

Relevant industry representative bodies (e.g. FPAI) have engaged on this legislation.

Measure on Track

M#15 EU legislative / Regulatory Proposals

Q4 2018 Update: A meeting between Industry Representatives and Department of Finance dossier leads was held in October 2018 to review various ongoing developments on EU legislative and regulatory files. The files covered insurance, funds, banking and investment management. Industry representative bodies have been active in Brussels in connection with the relevant EU files.

Measure Complete

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Status at Q4 2018

M#16 Continue to monitor the skills needs of IFS industry and stakeholder engagement on education and skills

Q4 2018 Update:

The National Skills Council was launched in April 2017 and oversees research and provides advice on the prioritisation of identified skills needs and how to secure the delivery of identified needs. IFS will be considered alongside other skills needs as part of the work of the Council.

To help foster stronger links between employers and the education and training sector, the Department of Education and Skills has established a network of 9 Regional Skills Fora, along with 9 Regional Skills Fora (RSF) managers. The Fora have been established to align with wider Government policy and initiatives on regional economic development, including the Regional Action Plans for Jobs

The innovative structure of the fora sees the work plan within each region being driven by key stakeholders in the region including employers, enterprises and education and training providers.

In the first three quarters of 2018, the RSF Managers have engaged with over 900 individual companies and representative organisations. While the main sectors of engagement are in manufacturing (49%), ICT (10%) and Construction (10%), 6 of the 9 Regions are currently engaging with financial services employers, including through skills audits of companies, the facilitation of new upskilling programmes and reporting on regional skills needs.

Relevant industry representative bodies continue to raise awareness of the skills issues and to communicate with the CBI.

Measure on Track

M#17 Liaise and inform regarding changes to Ireland's network of double taxation agreements

Q4 2018 Update:

Following approval by Dáil Éireann, on 23 October 2018 the Taosieach signed the Statutory Instrument to give the force of law to the OECD’s Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (‘the BEPS Multilateral Instrument’). The Finance Act 2018 contains a provision to enable the State to ratify the BEPS Multilateral Instrument. The instrument of ratification, together with Ireland’s final multilateral instrument position, will now be deposited with the OECD, and this is expected to occur in January 2019.

A key recommendation of the OECD’s BEPS project is that changes should be made to bilateral double taxation treaties to reduce the possibility of double non-taxation arising, while ensuring that treaties remain effective in eliminating double taxation. There are approximately 3,000 double taxation treaties in existence worldwide. Ireland has 74 signed double taxation treaties. Rather than updating these treaties individually through bilateral negotiations, the BEPS Multilateral Instrument provides a method

Measure on Track

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Status at Q4 2018

for countries to update the application of their existing treaties to ensure the highest standards are met in respect of international tax planning. The BEPS Multilateral Instrument provides a mechanism for countries to transpose recommendations made by the BEPS project into existing bilateral tax treaties. It will modify the application of the majority of Ireland’s double taxation treaties to ensure that they are compliant with the recommendations of the OECD BEPS project.

M#19 Deliver a Master's degree course in International Law

Q4 2018 Update:

Law Society Finuas Skillnet developed a Master’s Degree in International Financial Services Law as part of the IFS2020 2017 Action Plan. The inaugural degree commenced in 2018 and was open to graduates of the Diploma in International Financial Services Law. The expanded degree is open to solicitors, diploma graduates and non-graduates. This expanded Master’s Degree will commence on the 11th January 2019.

Measure on Track

M#22 IFS Apprenticeship Programme

Q4 2018 Update: The International Financial Services (IFS) Apprenticeships have been developed by Financial Services Ireland (FSI) which is the business association within IBEC, in conjunction with the National College of Ireland (NCI), using industry input to create current and relevant industry apprenticeships. There are 2 new apprenticeships:-

(a) IFS Associate Apprenticeship (Level 6) (b) IFS Specialist Apprenticeship (Level 8)

The off-the-job training is provided by the National College of Ireland (NCI). The IFS Apprenticeship Consortium members include FSI, NCI, Citi and AIB. As at 31 December 2018, 21 apprentices had registered in 2018 on these programmes. The Accounting Technician Apprenticeship helps to address a skills shortage by opening up Accounting Technician Apprenticeship opportunities in industry, practice and the public sector. The programme is delivered through seven Partner Colleges across Ireland in 2017. It is planned to scale the programme nationally by 2021. Accounting Technicians Ireland (ATI) has been actively recruiting suitable collaborating employers in these regions, with a view to generating a targeted 20 places in each catchment area. The Accounting Technician Apprenticeship is led by a consortium of collaborating employers and members which includes college representation. ATI operates as the Co-ordinating Provider for the programme and is a recognised QQI provider.

Measure on Track

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Status at Q4 2018

As at 31 December, 88 apprentices had registered in 2018 on this programme. The Insurance Practitioner Apprenticeship, was developed by the Insurance Institute and IT Sligo. It was launched in September 2016 and was the first level 8 apprenticeship. It is available nationwide. Apprentices are released on study for an average of one day per week over the three years. For the remainder of the time they are working in industry. Apprentices specialise in underwriting, claims, or direct client advice. As at 31 December 2018, 80 apprentices had registered in 2018 on this programme.

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Strategic Priority 3: Drive Research, Innovation & Entrepreneurship in the IFS sector, with a particular focus on financial technology & governance, risk & compliance

This strategic priority focuses on the significant role of research, innovation and entrepreneurship in developing Ireland’s status as a leading global location for financial services. The objective is to continue to develop and promote Ireland as a centre for innovative, scaling and next generation companies with world-class capabilities in financial technology, governance, risk and compliance, working within an innovative ecosystem that supports advanced research and commercialisation in areas such as data analytics, mobile banking/payments, cloud computing, etc.

Table 4 Strategic Priority 3: Research, Innovation and Entrepreneurship

Status at Q4

2018

M#27 Tender for research services to benchmark payments in Ireland

Q4 2018 Update:

Following a tendering process, research is underway to benchmark payments in Ireland. A report will be published on the research.

Measure on Track

M#29 Promote and ensure market diversity with priority given to fintech & payments in well-defined markets

Q4 2018 Update:

The world’s longest running fintech conference SIBOS, celebrating its fortieth year, took place this year in Sydney (22–25 October). Enterprise Ireland organised a series of morning and evening events to coincide with the conference including a Fintech Advisory Panel in Sydney for EI client companies and a series of client buyer meetings. Minister of State at the Department of Public Expenditure and Reform, Patrick O’Donovan, Australian Ambassador, H.E. Breandán Ó Caollaí, and the New South Wales Consular General, Owen Feeney, attended some of these events.

For the first time ever, Enterprise Ireland participated in Hong Kong Fintech Week to promote 11 of its fintech companies who exhibited at the conference with EI support. Hong Kong Fintech Week (30th October to 1st November) is an initiative by the Hong Kong Government to further drive its position as Asia’s financial capital and to shape the future of financial services. It is the key event in Hong Kong every year and attracts around 8,000 attendees.

Enterprise Ireland also hosted a stand for seven clients at the Singapore Fintech Festival, (11–15 November) which is one of the world’s largest fintech festivals with 30,000 attendees. In addition to the companies exhibiting on the stand, three other Irish companies took part on the market visit, which included a client networking reception and dinner in the Singapore Ambassador’s residence. The Singapore Fintech Festival is organised by the Central Bank and Banking Federation in Singapore. The last two days were spent in Bangkok, which involved a day of one-to-one meetings, arranged with Thai banks and a final day at the Irish-Asian

Measure on Track

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Status at Q4

2018

Business Forum. Minister of State at the Department of Foreign Affairs and Trade, Ciarán Cannon TD, attended the Thai dinner and Friday conference.

The 13th annual UK Financial Services Dinner was held at the Irish Embassy in London in November, with over 80 attendees consisting of EI client companies, their guests and key UK Financial Services Industry decision makers, experts and influencers. Minister of State, Michael D’Arcy T.D. was keynote speaker at the event which was hosted by Ambassador Adrian O’Neill.

M#30 Provide dedicated fund for fintech start-ups

Q4 2018 Update:

In June, Enterprise Ireland launched a call for applicants to a Competitive Start Fund (CSF) targeting early-stage companies active in fintech and deep tech, as well as start-ups providing technology-driven solutions within the financial services sector or to the fintech/financial services sectors as an end market. This is the third year in which Enterprise Ireland has targeted specific CSF funding towards fintech entrepreneurs.

Following a final pitching process, six companies were selected for investments of €50,000 and began participating on the CSF programme in October. These included new start-up companies in the propertytech, adtech, asset tracking, paytech and telecoms sectors incorporating innovative blockchain, peer-to-peer and AI technologies in their product offerings.

Measure Complete

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Strategic Priority 4: Develop job-creation opportunities from emerging IFS sub-sectors & new markets

This section reports on progress in developing new opportunities across emerging sub-sectors that are identified throughout the lifetime of the IFS2020 Strategy.

Table 5 Strategic Priority 4: Develop job-creation opportunities from emerging IFS sub-sectors & new markets

Status at Q4

2018

M#31 Co-host the European Climate Innovation Summit in Dublin in November 2018

Q4 2018 Update:

The Climate Innovation Summit 2018 was held in November. Over 1,000 people attended 50 events with 80 world-class speakers. Among the highlights at the Summit were the launch of Ireland’s first Responsible Investment State of Play report and the €400,000 Sustainability Skillnet programme for 2019.

Measure Complete

M#32 Develop training programmes in climate risk and opportunity supported by Sustainability Skillnet

Q4 2018 Update:

Green and sustainable finance masterclasses were held during Climate Week Ireland, 5–9 November. In partnership with the Irish Chartered Society of Actuaries, a masterclass on environmental, social and governance (ESG) was held. In partnership with Insurance Ireland, an ESG masterclass for the insurance sector is being developed.

Measure Complete

M#33 The Irish Strategic Investment Fund (ISIF) will co-invest in suitable private sector proposals with a particular focus on asset management and financial technology

Q4 2018 Update:

The ISIF has a mandate to invest on a commercial basis to support economic activity and employment in the State. In response to this action, the ISIF has invested in Motive Capital Fund, a fintech specialist private equity investor focused on providing growth equity tickets between $5m and $100m. The firm invests in complex financial technology businesses with infrastructure-like characteristics. As a result of ISIF’s investment, Motive subsequently announced a $25m investment in Global Shares, an indigenous fintech company based out of Clonakilty in Co. Cork.

Measure Complete

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Status at Q4

2018

In addition to this, the ISIF has also co-invested with Barings Alternative Investments in Genesis Aviation Services Limited, a specialist aviation-focussed asset manager. This investment will enable Genesis to scale its operations substantially and, by managing the targeted fleet of narrow-body aircraft from Ireland, Genesis is expected to create significant opportunities for maintenance, repair and overhaul service providers throughout Ireland. The Minister for Finance recently announced a re-focussing of the ISIF mandate to prioritise key sustainable economic challenges, including regional development, sectors adversely affected by Brexit, projects to address climate change, and housing supply. However, the ISIF will continue to support indigenous financial technology companies with export-focussed growth ambitions.

M#34 Continue to engage at EU level on proposals for an EU Regulation on a pan-European Personal Pension Product (PEPP)

Q4 2018 Update:

Trilogue negotiations on PEPP began in October 2018 under the Austrian Presidency and five political trilogues took place during this time. The key issues under discussion related to who would authorise PEPP, who could apply to provide a PEPP and what a default investment option PEPP would look like. During the course of trilogues, progress was made across most of these issues.

On 13 December 2018 the Presidency and Parliament reached political agreement in principle – with further technical work to be completed. Most notably, it was agreed that National Competent Authorities will authorise PEPP, rather than EIOPA.

The Department of Finance remain engaged with their stakeholders and their colleagues in Brussels. While they await further details from the Presidency, and technical work remains to be completed, it is expected that the draft Regulation will be brought before Council for its approval in January 2019.

Measure on Track

M#36 Engage at EU level on Sustainable Finance proposals

Q4 2018 Update:

Draft regulations on a taxonomy are being examined at an EU Council Working Group. Stakeholders are being engaged through contact with Sustainable Nation Ireland and the funds industry. Other relevant Departments have been consulted.

Measure on Track

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Status at Q4

2018

The Department of Finance have engaged in Council Working Party meetings on proposals relating to sustainable disclosures and low-carbon benchmarks during Q4 2018. Both proposals have concluded in Council and were submitted to COREPER 2 on 19th December 2018 to agree a negotiating mandate. The Commission intend to adopt the proposals in 2019. These proposals have arisen from the Commission’s action plan on sustainable finance which sets out an EU strategy for sustainable finance in order to meet the goals of the Paris Agreement.

M#37 Develop and deliver a programme that addresses the specialised educational requirements relating to alternative investment structures

Q4 2018 Update:

As part of the Q3 Update, Skillnet Ireland advised that Summit Finuas Skillnet had identified a Private Equity Real Estate Programme developed by a UK-based provider that meets industry requirements in Ireland. In the meantime, Summit Finuas Skillnet has widely promoted this programme, which can be delivered by this provider in Ireland. However, Skillnet Ireland has been advised that demand is not sufficient to make a programme viable, in spite of the Network’s promotional campaign. Summit Finuas Skillnet will continue to make the programme available to all IFS member companies in 2019.

Measure delayed or

likely to not be

completed

M#38 Engage with EU Institutions on the EU Covered Bonds Directive proposal and represent Irish position at subsequent negotiations

Q4 2018 Update:

Negotiations on the EU Commission’s Covered Bonds proposals are at an advanced stage. The Department of Finance has engaged with the Central Bank and industry throughout the negotiation process, and has actively participated in the negotiations at working party level to ensure that our national positions are reflected in the draft text. A general approach has now been agreed at Council Level and Trilogues are expected to progress under the Romanian Presidency early in 2019. Following agreement at EU level, the Department will begin the transposition process of the legislation into Irish law.

Measure on Track

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Status at Q4

2018

M#39 Review and assess the situation in relation to the use of debt/equity hybrid instruments by SMEs

Q4 2018 Update:

Work is ongoing on preparing a paper on the review of the use of debt/equity hybrid instruments by SMEs and it is anticipated that the paper will be published later 2019.

Measure Delayed

M#40 Continue to monitor developments in relation to equity finance for SMEs

Q4 2018 Update:

The paper on the review of the use of debt/equity hybrid instruments by SMEs will include an update on developments in relation to equity finance for SMEs.

Measure on Track

M#41 Identify areas for further IFS-related actions through engagement with the Regional Action Plan stakeholders

Q4 2018 Update:

The refresh process for Regional Action Plans is currently ongoing and is supported by the Department of Business, Enterprise and Innovation. This process is stakeholder led, with the objectives and actions generated by the Regional Action Plan for Jobs committees in line with their understanding of the opportunities, strengths and needs of their region.

Measure on Track

M#42 Update on developments in relation to financial markets infrastructures

Q4 2018 Update:

The Department of Finance is monitoring developments in this area.

Measure on track

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Strategic Priority 5: Implementation Framework for IFS2020 The implementation of the IFS2020 Strategy is supported by a secretariat in the Department of Finance. The Strategy is driven by a structured process ensuring quarterly oversight of the implementation of the annual action plans which allow for structured interaction between industry and Government.

Table 6 Strategic Priority 5: Implementation Framework for IFS2020

Status at Q4

2018

M#43 Secretariat for Joint Committee

During the quarter the Secretariat:

supported the Minister of State in promoting the IFS2020 strategy,

finalised the Q3 progress report on the implementation of the 2018 IFS2020 Action Plan on the basis of material supplied by stakeholders and got it approved by the Minister,

drafted the Q4 progress report on the implementation of the 2018 Action Plan on the basis of material supplied by stakeholders, and submitted it for approval to the Joint Committee (HLIC/IAC)

worked with public and public sector stakeholders on issues facing the future of IFS.

Measure on Track

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Appendix 1: Monitoring Dashboard Action M Title Lead Deadline Q1 Q2 Q3 Q4

1 Promote Ireland as a location for IFS & world class innovative products and services

1 A public sector financial services sub-group to engage with the Cabinet Committee on Brexit

D/FIN Quarterly

2 Further progress co-ordinated IFS messaging Comms sub-group, IDA, EI

Quarterly

3 Promote and market Ireland as a location for foreign direct investment (FDI) to international financial services (IFS) firms

IDA Quarterly

4 Strategic promotion and marketing of Ireland’s IFS sector overseas under the IFS Ireland banner brand:

a. Overseas trade missions

b. Shared IFS calendar

c. Ministerial and other official visits

d. Banner brand – public sector

e. Banner brand – industry

f. International marketing material

D/FAT, D/BEI D/FAT EI, IDA, D/FAT IDA, EI IAC Comms sub- group, IDA, EI

Quarterly Quarterly Quarterly Quarterly Quarterly Quarterly

5 European Financial Forum 2018 Q1 2018

6 Plan the European Financial Forum 2019 Review Q1 2018 Project Plan Q2 2018

7 Host an event in London to highlight the many advantages Ireland has for carrying on international insurance-related activities

Q2 2018

8 Introduce an international marketing plan to promote the European Insurance Forum

Insurance Ireland

Q2 2018

9 Insurance Ireland to update its Jurisdictional Promotion Brochure produced in partnership with IDA under the title “Ireland for Insurance”

Insurance Ireland

Q1 2018

10 Promote regional locations for second site operations to support growth by IFS companies located in or near Dublin

EI, IDA Q2 2018 Q4 2018

11 Research will be carried out on the opportunities for Ireland’s financial services sector within Asian financial institutions

Asia Matters Q1 2018

12 Present and update quarterly economic data on IFSIreland.com

PSCG, Comms sub-group

Quarterly

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2 Drive continuous improvement in the operating environment and competitiveness of Ireland’s IFS sector

13 Ireland as a global location for private equity funds management

D/FIN Q2 and Q4 2018

14 Engage at EU level on proposals in relation to the regulation of crowdfunding

D/FIN Q2 2018 and Q4 2018

15 EU legislative / Regulatory Proposals Industry Representatives

Quarterly

16 Continue to monitor the skills needs of IFS industry and stakeholder engagement on education and skills

D/ES Q4 2018

17 Liaise and inform regarding changes to Ireland’s network of double taxation agreements

D/FIN Q4 2018

18 Design and deliver an IFS Legal Brexit Summit D/ES Provide update Q3 2018

19 Deliver a Master’s degree course in International Law

D/ES Q4 2018

20 Design and deliver a fintech symposium D/ES Q3 2018

21 Deliver an aviation future leaders programme D/ES Q3 2018

22 IFS Apprenticeship Programme D/ES Q4 2018

23 Continue to deliver a postgraduate programme in applied alternative assets

Institute of Banking

Q3 2018

24 Expand the delivery of Institute of Banking relevant IFS programmes across Ireland

Institute of Banking

Q3 2018

25 Ireland to seek inclusion on Cape Town Convention List

D/TTAS Q3 2018

3 Drive research, innovation & entrepreneurship in the IFS sector, with a particular focus on financial technology & governance, risk & compliance

26 Develop promotion campaign for Ireland’s fintech sector based around ‘Irish Advantage’ campaign

EI Q3 2018

27 Tender for research services to benchmark payments in Ireland

D/FIN Q4 2018

28 Conduct a fintech census to provide a fact base on the scope, scale and strategic positioning of the sector

EI Q2 2018

29 Promote and ensure market diversity with priority given to fintech & payments in well-defined markets

EI Quarterly

30 Provide dedicated fund for fintech start-ups EI Q4 2018

4 Develop job-creation opportunities from emerging IFS sub-sectors and new markets

31 Co-host the European Climate Innovation

Summit in Dublin in November 2018 Sustainable Nation Ireland

Q4 2018

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32 Develop training programmes in climate risk

and opportunity supported by Sustainability Skillnets

Sustainable Nation Ireland

Q3 2018

33 The Irish Strategic Investment Fund (ISIF) will co-invest in suitable private sector proposals with a particular focus on asset management and financial technology

ISIF, IDA, EI Q4 2018

34 Continue to engage at EU level on proposals for an EU Regulation on a pan-European Personal Pension Product (PEPP)

D/FIN Quarterly

35 Engage at EU level on Capital Markets Union proposals

D/FIN Q3 2018

36 Engage at EU level on Sustainable Finance proposals

D/FIN Quarterly

37 Develop and deliver a programme that addresses the specialised educational requirements relating to alternative investment structures

D/ES Q3 2018

38 Engage with EU Institutions on the EU Covered Bonds Directive proposal and represent Irish position at subsequent negotiations

D/FIN Q4 2018

39 Review and assess the situation in relation to the use of debt/equity hybrid instruments by SMEs

D/FIN Q3 2018

40 Continue to monitor developments in relation to equity finance for SMEs

D/FIN Q4 2018

41 Identify areas for further IFS-related actions through engagement with the Regional Action Plan stakeholders

D/BEI Q4 2018

42 Update on developments in relation to financial markets infrastructures

D/FIN Q4 2018

5 Implementation framework for IFS2020

43 Secretariat for Joint Committee D/FIN Quarterly

Legend

Measure delayed Measure at risk of being delayedMeasure on trackMeasure Completed

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Appendix 2: Glossary of Terms

AI Artificial Intelligence

BPFI Banking & Payments Federation Ireland

CBI Central Bank of Ireland

Comms Subgroup Communications Sub Group of the IFS2020 Public Sector Co-Ordination Group

ESG Environmental, Social and Governance

D/BEI Department of Business, Enterprise and Innovation

D/ES Department of Education and Skills

D/FAT Department of Foreign Affairs and Trade

D/FIN Department of Finance

D/TTAS Department of Transport, Tourism and Sport

EI Enterprise Ireland

EFF European Financial Forum

FIBI Federation of International Banks in Ireland

FPAI Fintech & Payments Association of Ireland

FSI Financial Services Ireland

HLEG High Level Expert Group

HLIC High Level Implementation Committee

IAC Industry Advisory Committee

IAIM Irish Association of Investment Managers

IFS International Financial Services

IMI Irish Management Institute

ISIF Ireland Strategic Investment Fund

NCADF National Civil Aviation Development Forum

PSCG Public Sector Co-ordination Group

SFI Science Foundation Ireland

SME Small and medium-sized enterprises

SNI Sustainable Nation Ireland