Behold, the offshore data banks… Could Ireland be the new Barbados for tech?

The topic of this blog post is on the phenomenon of social media networking sites’ parent companies being located in Ireland, and the role of governments in protecting these companies as well as their citizens.

Why is Ireland is Twitter’s privacy policy?

I was originally looking to do a comparison between Twitter’s American and “everywhere else” privacy policies. As I read them, they stated that their headquarters were located in Ireland. Later, when I revised the topic of privacy and googled cases where European governments had challenged Facebook, I found numerous articles indicating that Facebook had won a case against the Belgian Privacy Commission in 2015 because it was registered in Ireland and protected by the law of Ireland.

Why did the Belgian Privacy Commission try to use Facebook?

in 2015 for collecting data on individuals who were not Facebook users and monitoring Facebook users when they were logged out, through cookies and pixels installed on their computers. Therefore someone without a Facebook account may unknowingly install cookies and pixels on their computer by clicking on sites with Facebook plug-ins, which breaches consent to do so. The Belgian Privacy Commission recently published recommendations this year pertaining to the processing of personal data by Facebook through cookies, social plug-ins and pixels. They are not giving up the fight to protect the privacy of Belgian people.

Wait, there’s more companies headquartered in Ireland?

After doing a little more digging, I discovered other networking sites and companies that are located in Ireland as well, such as Google, Apple, Microsoft, Uber and AirBnB (Worstall, 2013). The incentive for this they say, is the corporate tax rate. If a corporation is located in Ireland, it pays tax on profits made in Ireland, not on the profits made in other EU countries.

Could Brexit mean new HQs in London?

A recent Forbes article indicates that Snap, Snapchat’s parent company is considering moving their HQ to London, England, as opposed to Ireland (Worstall, 2017). With the changes, profits made outside the UK are exempt from taxation, although the tax rate is still higher than Irelands. The reason for the move has to do with proximity to their brands and users, and the larger population which makes it easier to attract young workers.

Looking to the future

It will be interesting to see future trends in where American companies choose to register their parent companies, and if more companies will locate to London or not following post-Brexit policy changes. In Snap’s case, it wasn’t the corporate tax rate, that led to choose London as their next headquarters. Regardless of where head offices locate in the future, for the most part, the world’s online data currently appears to be subject to Irish data use laws.

 

Social Media Promotion

Twitter

What do you think about American #socialmediacompanies registering #parentcompanies in #Ireland? https://goo.gl/I0Rmf2

Do you think that #Brexit will mean more #tech companies for #London? https://goo.gl/I0Rmf2

 

facebook

Social media companies have been registering parent companies in Ireland due to a lower corporate tax. However cases against Facebook for privacy breaches have been overturned because Irish law protections.

 

 

References:

Gibbs, Samuel. 23 February, 2015. Facebook’s privacy policy breaches European law, report finds. The Guardian. https://www.theguardian.com/technology/2015/feb/23/facebooks-privacy-policy-breaches-european-law-report-finds

Ausschuss fur den Schutz des Privatlebens (Commission for the pretection of privacy). 16 May, 2017. The Belgian Privacy Commission publishes new recommendations relating to the processing of personal data by Facebook through cookies, social plug-ins and pixels. https://www.privacycommission.be/de/node/19987

Worstall, Tim. 13 Spetember, 2013. What A Surprise, AirBnB Chooses Dublin As European Headquarters, Here Comes The 2% Tax Rate. Forbes. https://www.forbes.com/sites/timworstall/2013/09/13/what-a-surprise-airbnb-chooses-dublin-as-european-headqaurters-here-comes-the-2-tax-rate/#b61dc0a42a55

Worstall, Tim. 10 January, 2017. Snapchat’s London International HQ Decisions Rests On One Single British Policy Change. Forbes. https://www.forbes.com/sites/timworstall/2017/01/10/snapchats-london-international-hq-decision-rest-on-one-single-british-policy-change/#367d40a96b7e

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