Dr. Jim Stewart:

I am not quite sure why companies should make a major distinction between onshore and offshore. From the point of view of marketing and selling various financial products, it might be easier to sell them if they are marketed as being onshore but, in fact, for tax and other reasons they are effectively offshore.

Most of the activities in the IFSC are offshore. They have nothing to do with the Irish domestic economy and for that reason they are not subject to regulation or there is minimal regulation by the Central Bank. The distinction between offshore and onshore with regard to IFSC activities is minimal. I do not understand why one would wish to make a distinction.

With regard to charitable trusts, it is quite obvious that section 110 companies are not charities in the way the Society of St. Vincent de Paul or other charities are. Corporate law has evolved to allow companies to be termed charitable trusts and to be taxed and regulated as charitable trusts when they are not, in fact, charitable trusts. The Charities Regulator certainly does not look at section 110 firms, yet they have the legal status of being a charity. I suspect the reason for that is to try to protect the assets. If it is a charitable trust and if other parts of the firm go into liquidation, the trust keeps its assets intact. They cannot be touched by other creditors. The problem is that if the assets of the charitable trust fall below the debt that has been raised to fund those assets, then it becomes effectively insolvent. For example, a number of the aircraft leasing firms may become insolvent or suffer large losses because of the Russian action in respect of aircraft leasing firms from Ireland to Russia. It is a thing that puzzles me. How is it that charitable trusts have become such a key component of corporate finance and how have they become integrated into company law and used alongside companies that are subject to the Companies Acts?