Highlights from Chambers Ireland – June 2021

Recovery and Resilience: The Path Ahead – UPDATE:

From 5th July, the following measures will apply:

  • Numbers permitted at outdoor events can increase as planned, to a maximum of 200 attendees for the majority of stadia, and to 500 for stadia/venues with capacity greater than 5,000, with appropriate protective measures.
  • No limit on numbers of people that can visit together once they are all fully protected by vaccination or have had COVID-19 infection in the previous 9 months.
  • Weddings with 50 guests can proceed.
  • Working from home should continue.

For a full list of changes to the plan and the extension of supports, please see here.

Preliminary deal on €5 billion fund to mitigate the effects of Brexit:

A €5bn fund to overcome the consequences of the UK’s withdrawal came a big step closer to adoption after the Council and the European Parliament reached a preliminary agreement on the draft regulation. The deal means that funding from the Brexit adjustment reserve can begin to be disbursed before the end of the year. The reserve is designed to support all EU Member States, while focusing on the most affected regions and sectors.

EU Digital COVID Certificate: EU Gateway goes live:

The European Commission proposed an update to the Council Recommendation on the coordination of free movement restrictions.  As the epidemiological situation is improving and vaccination campaigns are speeding up all over the EU, the Commission is proposing that Member States gradually ease travel measures, including most importantly for the holders of the EU Digital COVID Certificate. The Commission has also proposed to update the
common criteria for risk areas and to introduce an ‘emergency brake’ mechanism, to address the prevalence of new variants of concern or interest. The proposal also includes specific provisions on children to ensure unity of travelling families and a standard validity period for tests.

The OECD Corporation Tax Agreement – what does this mean for Ireland?

Negotiations at the OECD to agree a global framework to govern the taxation of company profits have been gathering pace in recent months, with an agreement reached between the G7 countries at a meeting on 5 June 2021. OECD Secretary-General Mathias Cormann welcomed the ground- breaking agreement by G7 Finance Ministers on key elements of international tax reform designed to address the tax challenges of the digitalisation and the globalisation of the economy. This decision adds important momentum to the coming discussions among 139 member countries and jurisdictions of the OECD/G20 Inclusive Framework on BEPS, where the OECD will seek a final agreement ensuring that multinational companies pay their fair share everywhere. This discussion can be divided into two strands or pillars.  Pillar One of the OECD’s proposal addresses how the tax base should be determined and Pillar Two deals with the imposition of a global minimum effective rate of corporate tax. The full impact of the reforms
on Ireland’s economy is largely dependent on the rate of tax that is agreed as part of the negotiations on Pillar Two. In this regard, the G7’s agreement of a rate of at least 15% signals that the Irish Government’s goal to retain its 12.5% rate of corporate tax has become an increasingly challenging task. The Irish Government will hope that the OECD negotiation process, which aims to conclude a final deal by October 2021, will allow Ireland to reach an agreement on international tax reform that preserves the principle of tax competition as a lever for generating growth in smaller
economies. The success of the OECD negotiations depends on the ability of its members to reach a compromise in the coming months.

EU proposes a strong multilateral trade response to theCOVID-19 pandemic:

On 4 June the EU submitted its proposal seeking the commitment of WTO members for a multilateral trade action plan to expand the production of COVID-19 vaccines and treatments, and ensure universal and fair access.  With this proposal to the WTO, divided in two communications, the EU underlines the WTO’s central role in the response to the COVID-19 pandemic and urges fellow WTO members to agree on a set of commitments, including on intellectual property rights.

The EU calls on governments to:

Ensure that COVID-19 vaccines, treatments and their components can cross borders freely;

Encourage producers to expand their production, while ensuring that those countries most in need of vaccines receive them at an affordable price, and;

facilitate the use of compulsory licensing within the WTO’s existing Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS). The TRIPS Agreement already provides this flexibility, which is a legitimate tool during the pandemic that can be used swiftly where needed

Quick updates:

The Irish language is on track to reach full status in the EU Institutions by 1 January 2022.

The UK has requested that the European Commission extend the grace period (from 30 June 2021 to 30 September 2021) concerning the movement of chilled meats from GB to NI, agreed within the context of the Protocol on Ireland/Northern Ireland.

Commission launches new initiative to address EU skills shortages and improve migration cooperation with partner

Commission to invest €14,7bn from Horizon Europe for a healthier, greener and more digital Europe. More on this here.