Ireland Strategic tourism Investment

Shannon Region Ireland’s Strategic Tourism Investment Location

» corporate investment incentive opportunities » International product development investment opportunities

W W W. S H A N N O N D E V E L O P M E N T. I E C L A R E • L I M E R I C K • N O R T H T I P P E R A R Y • S O U T H O F F A LY • N orth K erry

Who we are

Shannon Development is the Irish government agency responsible for promoting the Shannon Region as a location for overseas investment and assisting companies already established here. Shannon Development is also the Shannon Region’s Tourism Authority.

Shannon Development assists with: • Comprehensive information on business opportunities in the Shannon Region, key business sectors and the Irish economy • Advice on how to proceed when setting up a business in the Shannon Region • Providing Grants and other incentives where applicable • Introductions to relevant contacts including, local industry, utility providers

and professional service providers such as lawyers, accountants, and recruitment companies • Assistance in arranging visiting programmes • Support in finding companies for possible joint ventures or technology licensing arrangements • Identifying suitable property solutions

Welcome to the Shannon Region a leading investment location

Dear Investor, As the regional economic development agency appointed to the Shannon Region by the Irish government, Shannon Development is delighted to launch a new comprehensive range of facilities and incentives tailored to the tourism related investor in the Shannon Region.

Located on the West coast of Ireland and covering the counties of Clare, Limerick, North Kerry, South Offaly and North Tipperary the Region is a primary business investment location for national and international companies. From low corporation tax rates to a highly skilled workforce you can achieve a range of significant competitive advantages by locating here.

As a company, we also bring 50 years of tourism and industrial development experience to the initiative. This brochure details the full suite of incentives available which I hope you find useful.

For existing company expansions or new operations set-up Shannon Development is your key investment partner. Our track record speaks for itself. From our beginnings in 1959, we now have, as part of our enterprise support role, over 20,000 people employed in foreign and Irish-owned firms in our business parks. Shannon Free Zone, our leading multi-sectoral business park, alone is home to 110 companies employing approximately over 6,500 workers. It generates over 3.5 billion in export sales annually across an impressive range of internationally-traded services and high-end manufacturing sectors.

On the tourism side, we are synonymous with pioneering a diverse range of innovative and competitive tourism concepts. These range from the creation of Bunratty Medieval Banquets, the establishment of Shannon World Aviation Park, and the attraction of significant mobile tourism investment into the region such as Doonbeg Golf Resort. Since 1989, Shannon Development assisted tourism projects have resulted in a total investment of â‚Ź614 million into the Region and the creation of approximately 5,000 jobs.

We spread the Region’s tourism message annually to over 250 million people worldwide.

We are uniquely positioned to assist you with locating in Ireland’s Shannon Region. Please contact us directly to discuss our range of investment incentives further. We look forward to working with you and your company.

Dr. Vincent Cunnane, Chief Executive Officer

The Shannon Region Interconnected in Ireland Belfast

Dublin

4PVUI 0GGBMZ

Galway

Birr

$MBSF

Nenagh

Ennis

/ 5JQQFSBSZ

4IBOOPO "JSQPSU

Limerick

/ ,FSSZ

-JNFSJDL

Tralee

Cork

Shannon Region covers: Counties Clare, Limerick, North Kerry, North Tipperary and South Offaly Population: 450,000 approx.

Area in sq. km.: 10,000 sq km Largest City: Limerick City - pop. 76,000 including city and urban communities Main Airport: Shannon International Airport

Ireland is now positioned as a knowledge economy, a claim reinforced by satisfying the World Bank Group’s four key pillars:

An Economic and Institutional Framework that ensures a stable macroeconomic environment, competition and flexible labour markets. The 2007 Index of Economic Freedom, compiled by the Wall Street Journal and The Heritage Foundation, categorises Ireland as a ‘Free’ economy, and ranks Ireland third out of 162 countries worldwide. It also states that ‘Ireland has one of the world’s most probusiness environments, especially for foreign businesses and foreign investment’ and that ‘Ireland’s policy framework promotes an open and competitive business environment’.

According to the World Bank, Ireland’s economy ranks seventh out of 181 economies for ease of doing business, fifth for protecting investors and sixth for taxes. (Doing Business 2009 Report, World Bank) A Quality Education System that ensures that citizens are equipped to acquire, use, and share knowledge. The IMD World Competitiveness Yearbook 2009 ranks Ireland’s education system eighth from 57 countries surveyed for meeting the needs

of a competitive economy. Ireland is ranked ninth in terms of knowledge transfer between companies and universities.

A Dynamic Information Infrastructure that can facilitate the effective communication, dissemination, and processing of information.

Ireland has significant international connectivity capacity to support current and future enterprise activity. High levels of capacity and diversity have resulted in strong competition and very competitive prices. Ireland currently offers the lowest international leased line costs in the OECD. Ireland also has an extensive national fibre optic network.

Innovation Systems that bring together researchers and businesses in commercial applications of science and technology.

Science Foundation Ireland (SFI) invests in academic researchers and research teams who are most likely to generate new knowledge and leading edge technologies and also advances co-operative efforts among education, government and industry.

Ireland —where your business will grow

The Tourism Industry in Ireland There were approximately 6.5 million overseas visits to Ireland in 2009, generating €3.9 billion in foreign exchange earnings.

Combined with domestic tourism expenditure, tourism is worth €5.2 billion to the Irish economy.

Tourism is Ireland’s largest indigenous industry in terms of employment – over 200,000 of the labour force are employed in the tourism and hospitality sector.

From a corporate investment perspective, there is a rich and diverse variety of international companies based in Ireland servicing the global tourism, travel and leisure industry. These range from multilingual call centres, an extensive aviation sector, ICT, insurance, financial and shared services.

Some of the world’s largest hotel groups have established multilingual call centres in Ireland for reservations and customer services. These include Marriott International, RCI (a subsidiary of the Wyndham Worldwide Corporation), Starwood Hotels and Radisson Hotels International.

Other Irish bases for international customer service centres within the tourism and travel industry include American Airlines, Korean Airlines, eBookers, Hertz and Portman Travel.

Foreign Direct Investment Almost 1,000 overseas companies have chosen Ireland as their European base, and are involved in a wide range of activities in sectors as diverse as engineering, information communications technologies, pharmaceuticals, medical technologies, financial and international services, aviation and tourism.

These companies employ 135,000 people directly and sell 90 billion worth of products and services in world markets. With 1% of the EU population, Ireland wins approximately 5% of all Foreign Direct Investment (FDI) into Europe.

The aviation sector in Ireland is extensive, consisting of about 160 companies employing approximately 5,500 people in manufacturing;

maintenance, repair and overhaul (MRO); aviation services and other aerospace activities.

Shannon-based companies include Shannon Aerospace, Air Atlanta, Lufthansa Technik, Omega Aviation Services Ltd, Hamilton Sundstrand Shannon and Western Avionics Ltd. Ireland is also a leading location for ICT firms operating in the tourism sector. Such companies include Micros Fidelio, who is a worldwide market leader in the provision of enterprise-wide information technologies for the hotel industry, and Transas, a world-leading developer and supplier of integrated solutions and technologies for the aviation, marine and leisure industries.

There is also a wide-range of companies providing financial and other support services to the global tourism and travel industry.

TravelSavers Ireland, based in Shannon, provides marketing and training solutions to travel service providers as well as call centre services to corporate travel agencies. Other examples of Shannonbased firms include aircraft leasing companies such as GE Commercial Finance Aviation Services, AerCap and Genesis Lease Ltd; travel insurance providers White Horse Insurance Ltd; and Phoenix American Financial Services Ltd who provide aviation securitisation and a comprehensive range of other business services.

Shannon at a glance

Shannon, in County Clare, is a leading business location within the Shannon Region and Ireland. It offers a pro-business environment, excellent air and road connectivity and the facilities that businesses need to succeed.

Shannon Free Zone Facts & Figures Shannon has a highly-developed infrastructure, with modern telecoms, connectivity to the rest of Europe and the US, and a sophisticated network of service providers.

Key sectors at Shannon Free Zone include: • Aerospace • Technology • Engineering • Pharmaceuticals 10

• Healthcare • Medical Devices

At a glance: Shannon Free Zone — Ireland Distance From

Name

Nearest Town

Shannon

Miles Kms 1

1.6

General Population: 9,000

Nearest City

Limerick

15

24

Population: 76,000

Capital City

Dublin

138

220

Population: 1million

Nearest Airport Shannon 1.5 2.4

Scheduled daily services to Continental Europe, UK and US

Nearest Ro/Ro Port Cork 79 126

Regular Sailings to UK and Continental Europe

Nearest Container Port 35 56

Shannon-Foynes Weekly container service to Rotterdam

Rail Station

Inter-city rail links

Limerick

15

24

Acute Hospital Limerick 15 24

Provides an extensive range of medical services

3rd Level Institutes Limerick 15 24 and Universities

University of Limerick and Limerick Institute of Technology

Key business activities carried out at Shannon Free Zone include: • Customer support and Contact Centres • Financial Services • Supply Chain Management • Shared Services • Production • Headquarters • Research and Development

3.5 â‚Ź billion

generated in sales,with 90% in exports, by 7,000 employees in 110 companies.

pro-business environment, low corporation tax and a well-educated, skilled workforce attract overseas companies to use Shannon to serve global markets.

Over 50% of enterprises provide internationally-traded service activities and account for 35% of employment.

University of Limerick, Institute of Technology Tralee and Limerick Institute of Technology are some of the excellent 3rd level educational facilities in the Region.

Quality buildings to suit enterprises of any size, and needs, are ready to buy or rent at Shannon.

600 Acres

(240ha) adjacent to Shannon International Airport comprise the Shannon Free Zone.

11

12

Skilled and flexible workforce 13

We have a well-educated and productive workforce with a ‘can do’ attitude. We have leading universities and other third-level education institutes that offer world-class research capabilities and highly qualified graduates. Our people have the wide skill base to meet your company’s needs.

14

One of the reasons why so many companies choose Ireland is because of the unique workforce— Ireland has the youngest population in Europe with under-25s accounting for over ...

Surveys show that foreign investors consider the quality and the ‘can do’ flexible attitude of Irish people to be two of the country’s greatest advantages.

Furthermore, the Irish workforce is welleducated and Ireland possesses a sophisticated educational infrastructure which provides a basis for competitive advantage.

IMD World Competitiveness Yearbook 2009 ranks Ireland third in the world in productivity in both industry and services (based on related GDP per person employed).

English mother tongue and ready supply of multilingual skills.

Working Hours and Holidays Employment legislation in Ireland governs a few crucial and basic areas.

Maximum hours of work for industrial workers are set at 48 hours per week plus 12 hours overtime but in practice, the average is 39 hours per week. Statutory leave has been increased gradually over the last number of years in Ireland and now the statutory minimum is four weeks per annum.

... 36%

Future Availability of workforce

Skilled Labour 2009 (Country Score)

% Population under 25

2010

2015

Ireland USA Hungary United Kingdom France Czech Republic Europe Portugal Spain

34.6 36.6 39.8 39.9 40.1 39.6 40.2 41.0 40.2

36.3 37.2 41.1 40.3 41.3 41.2 41.5 42.8 41.9

Source: Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat, World Population Prospects: The 2008 Revision.

Ireland Japan Sweden USA Germany France Netherlands United Kingdom Czech Republic Portugal Spain

7.90 7.24 6.90 6.67 6.49 6.06 5.96 5.60 5.58 5.16 4.36

Source: IMD World Competitiveness Yearbook, 2009.

15

Statutory Working Hours

Annualisation of hours in Europe

Country

‘Annualisation’ or ‘annualised hours’ schemes allow employees’ working time (and pay) to be calculated and scheduled over the period of a year (or some other period longer than a week, if a broad definition is used).

They are a means of achieving working time flexibility, which has proved increasingly popular in a number of European countries in recent years, and which has been promoted by policy and recommendations.

Ireland Belgium Denmark France Germany Italy Luxembourg Netherlands Portugal Spain United Kingdom

Maximum daily hours

Maximum weekly hours

Average weekly hours

13 8 13 10 10 13 10 9 8 9 13

48 38 48 48 48 48 48 48 40 40 48

39 38 37 38 38 38 39 37 38 38 37

Source: EIRO, 2008

Labour Productivity 2008

Selection of Comparative Labour Costs in Europe 2009

GDP (PPP) per person employed per hour (US $)

(Hourly rate)

Ireland

UK

Germany

Neths.

Junior Clerical/Admin

14.46

10.89

14.96

19.59

Senior Clerical

26.44

20.91

26.22

29.59

Senior Secretarial

22.24

16.78

22.70

27.29

Technician—Entry level

14.16

10.89

14.96

19.59

Technician—Senior level

18.71

14.09

19.65

25.17

France Ireland USA Netherlands Germany United Kingdom Spain Japan

Supervisor

26.44

20.00

26.22

29.59

Source: IMD World Competitiveness Yearbook, 2009.

Junior Accountant

22.24

16.78

22.70

27.29

Senior Accountant

32.69

27.72

35.79

35.48

Middle Manager

36.30

31.84

39.78

39.98

Senior Manager

44.75

42.00

49.13

50.78

Employee

Dept. Head

55.18

55.40

60.68

64.49

General Manager (major branch opr.)

84.90

103.09

87.93

107.91

105.94

145.41

103.15

142.16

76.00

86.79

81.18

94.02

Managing Director (subsidiary) Director Source: Federation of European Employers, May 2009

50.14 49.63 47.78 45.58 41.26 39.08 38.62 37.28

Flexibility and Adaptability of Workforce 2009 when faced with new challenges

Ireland USA Netherlands United Kingdom Portugal Japan Czech Republic Germany Source: IMD World Competitiveness Yearbook, 2009

7.85 6.98 6.91 6.31 5.92 5.71 5.46 5.27

16

Education

17

Locate in the Shannon Region to benefit from a highly-skilled, highlyeducated flexible workforce.

Universities and third-level institutes established here offer employees opportunities to up-skill and broaden their expertise.

18

Ireland is ranked eighth in the world for its level of university education meeting the needs of a competitive economy.

The IMD World Competitiveness Yearbook 2009 ranks Ireland’s education system eighth from 57 countries in terms of meeting the needs of a competitive economy.

In 2006, 40.2% of the population aged 25-34 in Ireland had third-level education, compared with 28.6% across the EU-27.

The Region contains one University and two Institutes of Technology, located in Limerick and Tralee. The Tipperary Institute also provides tertiary education and the Region is also home to the internationally renowned Shannon College of Hotel Management.

The University of Limerick (UL) is one of the foremost technological universities in Ireland with 13,000 students enrolled in full and part-time

degree, postgraduate and research programmes up to Doctorate level. The four colleges of focus are: • Kemmy Business School (Accounting & Finance, Insurance, Management, Economics, Marketing, Personnel) • Faculty of Arts, Humanities and Social Sciences (Languages & Cultural Studies, Law, Politics, History, Performing Arts) • Faculty of Science and Engineering (All major Engineering disciplines; School of Architecture; Materials Science; Mathematics; Information Systems; Environmental, Chemical and Life Sciences) • Faculty of Education and Health Sciences (Education & Professional Studies, Medical School, Psychology) UL operates one of the largest mandatory co-operative education

programmes in the EU. Approximately 2,000 students are placed on work experience programmes each year – 30% of them abroad.

The University also houses a range of internationally respected research institutes and centres. The National Centre for Tourism Policy Studies (NCTPS) within the Kemmy Business School conducts research encompassing all facets of the tourism industry (often commissioned by national and international agencies), runs a number of Ph.D research programmes and has developed a very successful Masters Programme in International Tourism.

In recent years there has been an increasingly relevant role for Institutes of Technology in the development of the Region, and the

development of a knowledge-based economy with labour market demands for highly qualified graduates.

The Institutes cater for a student population of over 8,000 and offer a wide range of full-time and parttime courses in all disciplines up to Doctorate level. Batchelor of Arts (BA) and Batchelor of Business Studies (BBS) degrees in tourism management are available from Limerick and Tralee Institutes of Technology.

Fáilte Ireland, the National Tourism Development Authority, operates many of its tourism and hospitality courses through the Institutes of Technology national network. Fáilte Ireland also runs a comprehensive range of management and professional development programmes for the tourism industry throughout the country.

Shannon College of Hotel Management was founded in 1951 to train managers for the Irish hotel industry. Since then, it has become Ireland’s leading college of hotel management and has established an international reputation for excellence.

Shannon College is a College of the National University of Ireland (NUI) and offers a Bachelor of Business Studies (BBS) Degree in International Hotel Management and a Bachelor of Commerce Degree (BComm) combined with an NUI Diploma in Management (International Hotel Management).

For over 50 years, Shannon College has placed its graduates in the world’s top hotel chains. The industry relationships that have developed have played a significant part in helping Shannon College to adapt

In recent years there has been an increasingly relevant role for Institutes of Technology in the development of the Shannon Region, and the development of a knowledge-based economy.

its course structures and content to suit the demands of the international business environment. Students follow a comprehensive academic structure to prepare them for their management careers, with particular emphasis placed on professional practice and intensive language training. The courses also involve two professional placements totalling 22 months in duration. Students are placed with major hotel groups in the UK, Ireland, Europe, USA, Asia or the Arabian Gulf, and this offers students the opportunity to experience the international hospitality industry at management level. Shannon College currently has over 1,400 graduates managing top-class hotels internationally.

The Educational System 2009 meets the need of a competitive economy (country score)

Netherlands Ireland Belgium Germany Sweden France United Kingdom USA Spain Source: IMD World Competitiveness Yearbook, 2009.

6.87 6.85 6.60 6.13 5.90 5.87 5.14 4.81 3.27

19

20

Facilities and property solutions tailored to your needs 21

We offer a wide selection of business accommodation options including standalone office complexes, hightechnology R&D centres and modern manufacturing and warehouse facilities.

Our property solutions include: » Manufacturing » Logistics » Distribution centres » Modern office units 22

Property Rentals Competitive rental/leasing solutions are available. Variations in solutions occur depending on the size, condition, and level of fit-out of the premises.

In multi-tenant accommodation, a charge is levied by the landlord to cover basic running costs such as repair and maintenance, cleaning and janitorial services.

For companies seeking to build their own premises, fully-serviced green field sites are also available.

Lease Terms Commercial property in Ireland is most commonly availed of under lease. The contract is evidenced in writing, and contains covenants and conditions governing the relationship between landlord and tenant. It may be possible (subject to conditions) to negotiate break clauses at set points throughout the lease when the occupier can serve an agreed period of prior notice on the landlord and/or pay an agreed sum to the landlord to

surrender the lease. Flexible lease terms can also be negotiated, i.e. four years and nine months, however, these terms must be agreed in advance.

Long-term leases are on full repairing and insuring terms, which place the onus on the occupier for the upkeep and repair of the premises. Provision for assignment or sub-let in long-term leases is standard, subject to the consent of the landlord.

23

Estate Service Charge An estate service charge is levied in industrial parks in respect of the upkeep and provision of common services and amenities, such as road maintenance, landscaping and public lighting.

Charges are levied pro rata with the amount of space occupied.

Business rates are a form of local taxation payable to the local municipal authority, which applies to commercial property only. The amount payable is based on a rateable valuation of the premises. The rateable valuation for a property is set by reference to the open market annual rental value of that property.

Other Property Options In addition to the landlords referred to, it is also possible to lease and purchase properties in the Shannon Free Zone from both local and national estate agents. Many are based in Shannon, and can be contacted at their local offices or through Shannon Development.

Westpark Shannon (www.westparkshannon.com) is a â‚Ź200m investment, featuring 1m sq ft of corporate real estate located on a 40-acre campus environment in the Shannon Free Zone. The flagship development comprises seven blocks of 115,000 sq ft (10,683 sq ms) each of world-class office accommodation.

The campus is being designed with the demands of multinational organisations in mind, including connection to multiple international Tier-1 telecommunications networks, and the inclusion of a world-class Telehouse on the campus.

Westpark Shannon is a â‚Ź200m investment, featuring 1m sq ft of corporate real estate.

24

Why choose Shannon: incentives 25

Choose Shannon as your investment location for its 12.5% corporation tax, one of the lowest in Europe, and other financial incentives, good connectivity and infrastructure along with availability of key service providers. As a regional development and local support agency, we offer a wealth of experience and expertise from which you and your company can benefit.

26

Corporation Tax Regime: • Ireland’s Corporation Tax rate of 12.5% is the lowest in the EU with the exception of Cyprus. This rate applies to all active trading income.

• Ireland’s Corporation Tax rate on passive income is 25%.

• Ireland’s Capital Gains Tax (CGT) rate is 25%, however, Irish resident companies who use Shannon as regional headquarters or as a location for holding company activities are exempt from CGT on the disposal of a substantial shareholding in their trading subsidiaries.

• Furthermore, group relief in relation to capital gains tax and trading losses is available to resident companies and branches of companies resident in the EU (carrying on a trade in Ireland).

• Dividends may generally be distributed to EU or Treaty-resident companies without withholding tax.

• Certain patent royalty income is exempt from tax (some research must be carried out in Ireland).

• Ireland does not have ‘controlled foreign corporation’ rules.

• Ireland does not have any ‘thin capitalisation’ rules.

2009 Corporate Tax Rate for Selected Countries Ireland United Kingdom Belgium France Netherlands Spain Austria Germany China Czech Republic Poland Latvia Cyprus Lithuania Hungary Luxembourg Portugal Sweden Denmark Malta USA

12.5% 28% 33.99% 34.43% 25.5% 30% 25% 30% 25% 20% 19% 15% 10% 15% 16% 28.59% 26.5% 28% 26.3% 35% 39.5%

Source: Deloitte & Touche and IMD, May 2009

• Attractive holding company regime.

• Unlimited loss carry-forward.

• An extensive double taxation treaty network that continues to be expanded and updated.

• Significant tax credits are available in respect of qualifying research and development work undertaken. This includes offset of the credits against previous and current year’s corporation tax liabilities.

• Corporation tax for new companies, incorporated after 14th October 2008. The companies will be exempt from corporation tax on income and gains for the first three year’s, where the total amount of corporation tax payable does not exceed €40,000.

Certain conditions will apply.

% Increase in Profit required to achieve the same distributable income available in Ireland Netherlands United Kingdom China Belgium France Germany USA Japan Source: Deloitte & Touche, May 2009

17.45% 21.53% 16.67% 32.56% 33.45% 25.00% 44.63% 48.31%

American Job Creation Act (2004) In October 2004, the American Jobs Creation Act of 2004 (the ‘Act’) became law. Changes to US tax provisions arising out of the Act have positive benefits for the aircraft leasing sector in particular.

Under prior law, a US shareholder of a controlled foreign corporation (CFC) that generated ‘foreign base company shipping income’ was required to include such amounts in income as a dividend for US income tax purposes, regardless of whether such income was actually repatriated back to the US. Foreign base company shipping income was generally defined as

income derived from the use of aircraft or vessels in foreign commerce, the performance of services in connection with the use of such aircraft or vessels, and the sale or other disposition of such aircraft or vessels.

The Act repeals this tax treatment and, consequently, opens the door for significant tax deferral benefits for US corporations conducting shipping activity through foreign corporate affiliates. Specifically, to the extent that the foreign corporate affiliates are conducting their activities in lowtax jurisdictions (e.g. Shannon), the corporate group (through appropriate tax planning) may be able to significantly reduce its effective tax rate with respect to its shipping operations.

The Act also provides a safe harbour for certain rents derived from leasing aircraft and vessels in foreign commerce, in order to ensure that such rents will not be treated as SubPart F Income to the US shareholder. Specifically, these rents will be excluded from the definition of SubPart F Income to the extent that the rents are derived in connection with the conduct of an active trade or business by the lessor – which for these purposes will be deemed to be the case, provided that the active leasing expenses of the lessor are not less than 10% of its profit on the lease.

27

Tax Exemption for Start Up Companies Certain start up companies which commence to trade in 2010 will be exempt from corporation tax on their trading profits for the first three years of trading, to the extent that their tax liability does not exceed €40,000 in an accounting period. The relief is subject to conditions.

Tax credits are available for qualifying research and development.

Employment Taxes Individual Tax and Social Security • Employers are obliged to Pay Related Social Insurance (PRSI) contributions.

• The general rate applying is 10.75%. This may be lower, depending on the level of salary.

• Pension contributions paid on behalf of employees are tax deductible. There is no statutory obligation to pay pension contributions on behalf of employees.

However, it is common practice for a company to contribute in the range of 5-10% of the employee’s salary. Under recently introduced legislation, all employers must facilitate an employee’s personal pension plan where there is no existing corporate pension plan in place.

• Employees are generally liable to PRSI at a rate of 4% of all earnings, except the first €127 per week and up to a ceiling of €52,000.

• The PRSI rate is applied to the gross salary and benefits after deduction of pension contributions.

28

• Foreigners resident and working in Ireland are generally covered by the Irish social security system, provided that the necessary documentation is in place.

• PRSI related levies amounting to 2% on all income are payable except by those earning €500 per week or less. Levies at 2.5% apply on income earned over €1,950 per week.

• PRSI contributions: Ireland provides a high level of coverage with respect to full-rate social insurance contributions, e.g. dental, health, unemployment benefits, state pension and maternity benefits.

• There are competitive income tax rates in Ireland. The first €36,400 is taxed at the standard rate of 20%, and the balance taxed at 41%. There are options available to married couples that enable a higher standard rate band to be allocated to one spouse up to a maximum of €45,400.

• An income levy applies to all income earned from 1st of January 2009. This levy is 2% of gross income, with higher rates applying to income in excess of €75,306 per annum.

Expatriate Tax • Generally, Irish resident and domiciled individuals are taxed on worldwide income and gains.

• Expatriates who are ‘non-domiciled’ in Ireland are liable to tax on a remittance basis in respect of income arising outside of Ireland. Since 1 January 2006, income from a foreign contract of employment where the duties are performed in Ireland are taxed in Ireland under the PAYE system.

Transfer Pricing Ireland has recently announced transfer pricing provisions to apply to trading transactions between associated persons. The provisions will align Ireland with international standards by adopting the OECD arm’s length principals in relation to contract law. The provisions do not apply to small and medium enterprises as defined by the EU Commission Recommendations. The provisions apply to periods commencing on or after 1 January 2011 and do not apply to arrangements agreed before 1 July 2010.

Research & Development Incentives Significant tax reliefs are available to Irish tax-resident companies who engage in qualifying research and development (R&D) activities. The reliefs are available in the form of tax credits and in some certain limited circumstances in the form of a repayment from the Irish Revenue Authority. The R&D tax credit may be claimed against “qualifying buildings” which are defined as buildings with a minimum R&D usage of 35% over a defined 4 year period. R&D work sub-contracted to unconnected parties also qualifies for the credit, up to a maximum of 10% of the company’s qualifying R&D expenditure in any one year. Up to 5% of R&D expenditure can be outsourced to European universities.

Grant Incentives Shannon Development may provide financial assistance to companies wishing to locate in Ireland or expand their existing operations here.

The unique characteristics of any proposed project will determine the incentive package available, in particular its location. Shannon Development evaluates potential projects through a process of negotiation.

The main criteria applied to determine the availability of grant incentives include:

12.5% corporation tax on all active trading profits.

• An assesment of the quality of employment and the likely employment levels to be created • Long-term stability of the industry concerned • Suitability of the project to Ireland’s long term industrial policy The types of grants that are available include: • Employment Grants • Research and Development (R&D) Grants • Training Grants • Capital Grants

29

Ireland also offers one of the most beneficial corporate tax environments in the world. A corporation tax rate of 12.5% applies to all corporate active trading profits. The grant, when approved, is usually paid when a job is created.

Note: All grant payments to projects approved under the EU National Regional Aid Scheme 2007-2013 must be approved prior to the start of work on the project. Aid may only be granted under the scheme if the beneficiary has submitted an application for aid, and Shannon Development has subsequently confirmed in writing that, subject to detailed verification, the project in principle meets the conditions of eligibility laid down by the scheme before the start of work on the project. If work begins before the conditions laid down in this paragraph are fulfilled, the whole project will not be eligible for aid.

Obama Administration Tax Proposals (May 2009) On May 4th 2009, President Obama announced his proposed changes to the US tax treatment of non-US profits of US multinationals. Although some changes have been indicated, it should be noted that a US multinational which currently qualifies for a deferral of US taxes on the active profits of its Irish-based subsidiary will continue to be eligible for this status.

Such profits are taxed in Ireland at 12.5% and are subject to US taxation only to the extent that they are repatriated back to the US. The new proposals refer to new ‘check-the-box’ rules, proposed changes to deny US tax deductions for expenses and to amend foreign tax credit rules.

In summary, although these proposals may have an impact in certain circumstances, the current system will continue to operate much as it has heretofore.

Furthermore, the detail of the new legislation is yet to be published, and is likely to take several years to come into effect. Ultimately, the effect will vary considerably depending on the multinational structure of the US groups concerned.

30

Case Studies

31

The Shannon Region has a proven track record as an investment location for a diverse range of successful indigenous and overseas companies. Overleaf are case studies on a number of the corporate and mobile tourismrelated investments in the Shannon Region.

Travel Savers Ireland TravelSavers Ireland, and Travel Helpline operating from Shannon are sister companies under the ownership of AMG Group (www.travelsavers.com).

AMG Group (t/a TravelSavers) comprises of 14 companies designated to the goal of supporting and driving business to affiliated Travel Agency associates.

General Electric GE is a diversified technology and services company dedicated to creating products that make life better, from aircraft engines and power generation to financial services, medical imaging, television programming and plastics. GE operates in over 100 countries and employs more than 315,000 people worldwide.

TravelSavers is an international travel marketing organisation with more than 3,000 independent affiliated travel agencies in 14 countries around the world. The Group enjoys long-standing relationships with travel service providers which are well established and trusted including top cruise lines, airlines, hotels, car rental companies, and tour operators. With 36 years of travel experience behind them, they’re one of the world’s largest travel marketing companies.

TravelSavers Ireland is a marketing company which partners with preferred travel trade suppliers and negotiates better commission terms for affiliated associate members than generally are available to sellers of travel products/services. TravelSavers Ireland also offers many technology tools for the traditional travel agency, thus bringing the total cost of investment down to an acceptable level for smaller operations.

32

Travel Helpline is a 24/7 emergency service marketed towards the corporate travel agency. Travel counsellors answer the phones out of hours for any travel agency that requires such a service. Shannon is one of three call centres under the Travel Helpline banner. Travel Savers Group also have offices in Denver, CO and at the AMG headquarters in Oyster Bay, NY.

White Horse Insurance Ireland WHI Ltd is a wholly-owned subsidiary of Thomas Cook Group plc., which provides a wide variety of travels insurance products for sale through travel agents, tour operators and insurance intermediaries both in the UK and Ireland. As well as providing cover for the majority of Thomas Cook Group plc, key clients also include Going Places, Bridge, Cresta, Tradewinds, Panorama, Business Travel Management, Direct Holidays Ireland & UK, The Cruise Store.

WHI commenced operations from Shannon in 2008 with 20 high skilled people and is planning to scale up to 50 people within two years.

GE Commercial Aviation Services GE Commercial Aviation Services (GECAS) is the commercial aircraft financing and leasing business of General Electric.

GECAS owns a fleet of 1,450 aircraft that it leases to more than 225 airlines in some 70 countries, and it manages nearly 300 aircraft for others. GECAS offers a full range of fleet and financing solutions, including operating leases and secured debt financing, engine leasing through its engine leasing unit, and pilot training through its aviation training unit.

Most of the GECAS-owned fleet is made up of modern Airbus and Boeing narrowbody and widebody aircraft and freighters. The fleet, with an average age of about six years, also includes regional jets from Bombardier and Embraer.

GECAS offers a variety of aircraft financing plans to airfreight operators around the world, and currently maintains a fleet of approximately 100 owned and managed freighters. GECAS has a freighter conversion programme in place to convert Boeing 737, 747 and 767 passenger aircraft into freighters.

GECAS’s Engine Leasing unit leases and finances GE, CFMI, Rolls-Royce, Pratt & Whitney and IAE aircraft engines. The unit offers a full range of services, including short-term rentals, operating leases, structured finance transactions, engine exchanges and guaranteed availability programs to give airlines additional flexibility in their operations.

GECAS recently introduced an Aircraft Component Management service that helps airlines finance and manage their rotable and repairable spare parts. This service reduces capital investment, lowers costs and improves on-time performance. The Memphis Group, a GECAS company, is the world’s third largest supplier of aviation parts, offering comprehensive parts supply chain management and financing.

LynxGroup, a GECAS affiliate, designs and manages innovative on-airport CargoPort solutions to help facilitate crucial aviation infrastructure.

The combined employment of GECAS and Shannon Engine Support Operations at Shannon is approximately 250 people.

Hamilton Sundstrand Hamilton Sundstrand is a global corporation with various business units that design, manufacture and support aerospace and industrial products for worldwide markets. The company’s aerospace business provides electric power generating, distribution, management and control systems; fuel and special fluid pumps; engine control systems; gearboxes; primary and secondary flight controls and actuation systems; ram air turbine emergency systems; auxiliary power units; environmental control systems; propeller systems; torpedo propulsion systems; launch vehicle hydraulic power units; and electronic controls and components.

Hamilton Sundstrand products serve the commercial, military, regional and general aviation markets. The company employs 16,000 worldwide and has annual sales of about $3.6 billion.

Hamilton Sundstrand Shannon is a fully certified provider of motor and generator components rewind services to the aerospace industry worldwide. The company holds certification from the JAA, FAA, CAAC, TCA and ISO 9001:2000, and has a combined rewind and repair capability of 1,100 parts. HS-Shannon was founded as Shannon Aircraft Motor Works in 1988, and was acquired by Hamilton Sundstrand in 1998. The facility is the first of its kind to specifically handle rewind of electrical aerospace, and serves both commercial and military aerospace customers worldwide.

Kiawah Development Partners Kiawah Development Partners (KDP) is the master developer of Kiawah Island, a 10,000 acre sea island located 21 miles south of Charleston, South Carolina.

In 1999, KDP acquired property options in Doonbeg, Co Clare, from Shannon Development and established the 5-Star Doonbeg Lodge complex, including the Greg Norman-designed 18 hole links championship golf course. Other facilities in the development include 56 luxury suite lodges (150 bedrooms), conference/event centre, golf clubhouse, health spa, and 80 golf links houses. At a total direct investment of approximately â‚Ź150 million, this represents the single largest tourism development established in the West of Ireland.

Lufthansa Technik The Lufthansa Technik Group is the world market leader in the Maintenance, Repair and Overhaul (MRO) of commercial aircraft, aircraft components and engines. With customised programmes for maintenance and state-of-the-art repair procedures, Lufthansa Technik continuously assures the reliability and availability of its customer fleets. The company’s global network consists of 25 operating subsidiaries and affiliates in Europe, Asia and the United States, and serves over 370 customers worldwide.

Lufthansa Technik Turbine Shannon (LTTS) specialises in the repair of components for both high and lowpressure turbines for CFMI and GE engines. LTTS is a member of the EPAR (Engine Parts and Accessories Repair) Network, a platform established within Lufthansa Technik to bring together the complete engine parts and accessories repair services of the group.

LTTS is licensed by General Electric and CFM International (Original Equipment Manufacturers of aircraft engines) to carry out repairs in accordance with their engine shop manuals, making it unique as one of a small number of companies outside of the OEM Engine manufacturers who are licensed to carry out repairs.

33

34

Infrastructure

35

We have an international airport, excellent road networks, rail and shipping channels. Modern telecoms connectivity to the rest of Europe and the world, is in place.

Air Transport Shannon International Airport has recently undergone a €58m expansion, boosting capacity to 4.5 million passengers a year. As of 2009, Shannon offers direct connectivity to many international destinations.

36

Air Routes

Shannon

• Daily national and international flights direct to the US and Europe • US Pre-clearance facility available. First airport in the world with US pre-clearance for private aircraft.

• Route network is continually being developed.

Rail: The connectivity of the Shannon Region has been further enhanced with the first phase of the Western Rail Corridor linking Galway to Limerick now opened. The Region also has excellent rail routes to the east of the country.

Approximate Cost of International Free Fone per min. (excl. VAT)

Band Origin of Call

International Freefone Subscriber Subscription Option

1

2

3

4

5

6

7

8

9

10

Subscription Cost of each Option ()

Base Rate

50 650 2000 5000 7500 10000 15000 20000 30000 40000

1 UK

.1679

.12 .11

.10

.09

.09

.08

.08

.07

.07

2 Near Europe

.3149

.18 .17

.16

.15

.14

0.9 .13

.12

.11

.10

.09

3 Mid Europe

.3988

.24 .23

.21

.19

.18

.17

.16

.15

.14

.13

4 Far Europe & N. Africa .7618

.53 .52

.50 .44

.42

.39

.37

.36

.36

.32

5 USA & Canada

.2413

.17 .17

.16

.13

.13

.12

.10

.09

.09

.09

7 Australia, New Zealand, Japan, Singapore & Hong Kong .7089

.50 .49

.46 .45

.42

.41

.41

.39

.38

.35

8 Middle East & South Africa

1.028

.72 .70

.67 .59

.59

.59

.59

.54

.52

.50

9 Rest of Pacific Rim

1.015

.71 .70

.67 .58

.41

.41

.41

.40

.40

.40

Source: Eircom, April 2008. The subscription cost is the committed monthly spend after discount.

37

US Customs and Borders Protection Zone — Shannon Airport In October 2008, the Irish and US governments signed an agreement to implement Europe’s first full US Customs and Border Protection (CBP) facility at Shannon Airport. From Fall 2009, this will allow US-bound passengers to pre-clear all formalities for US Immigration, Customs and Agriculture thus enabling a secure and streamlined entry process into the US. Passengers arrive in the US as domestic travellers, thereby speeding up journey times and shortening connection times.

For airlines, it will allow seamless connections at US hubs and allow carriers to use less expensive domestic airports in the US.

Telecommunications Shannon offers a state-of-the-art telecommunications infrastructure with full broadband connectivity linked to the national backbone.

The telecommunications market in Ireland is fully deregulated.

Road Transport Shannon has excellent national connectivity.

Situated on the N18 national route, this provides quick access to the national road and motorway network linking all major cities and ports in Ireland.

38

Shannon Region: Live, Learn, Work and Play 39

The Shannon Region is located on the West Coast of Ireland. The Region includes Counties Clare, Limerick, North Tipperary, South Offaly and North Kerry, which together have a population of over 450,000 people. Our Region has an excellent resource of a skilled and educated workforce, some of the leading third-level institutes in the country, a well developed infrastructural base, and some of the most breathtaking scenery in Europe.

We invite you to the Shannon Region to find out for yourself.

The Shannon Region

Galway

/PSUI 5JQQFSBSZ Birr

$MBSF Dublin

Ennis

Nenagh

4PVUI 0GGBMZ

4IBOOPO "JSQPSU

4IBOOPO "JSQPSU

Limerick

/PSUI ,FSSZ

-JNFSJDL

Tralee

40

The Shannon Region is a place of great natural beauty, embracing the counties of Clare, North Kerry, Limerick, South Offaly and North Tipperary. Limerick City is the historic capital of the Region. The Region is bordered on the west by the Atlantic coastline, where you can enjoy cliffs, beaches and coves along Europe’s most westerly shores. On the eastern side, the Region is dominated by the majestic River Shannon and the spectacular waterway of Lough Derg, Ireland’s premier watersports lake.

In this compact area, 190 kilometres from end to end, you will discover stunning landscapes, seascapes, great sporting activity, top class entertainment and visitor attractions.

Cork

The Shannon Region is well served with visitor attractions including castles and gardens, medieval banquets, caves, museums and historical centres, ancient settlements, not to mention the world-renowned Cliffs of Moher.

The Region is ideal for activities to suit all tastes and abilities, including a network of high-quality walking and cycling trails, horse-riding and driving routes. Water sports enthusiasts can find top-class angling, scubadiving, surfing, sailing and cruising.

Golfers can choose from a range of golf courses including Adare Manor Golf Resort, home of the Irish Open Championship in 2007 & 2008, and the famous links courses in Lahinch and Doonbeg.

Eating out in the Shannon Region offers a range of fine-dining and casual restaurants as well as traditional Irish nights. The Region offers a full range of accommodation from luxury castle hotels and manors to comfortable family-run hotels and guesthouses, as well as first-class hotels for the business traveller.

The University Concert Hall (UCH), Limerick is Ireland’s first purpose-built concert hall and is the permanent home of the Irish Chamber Orchestra. UCH is a 1,000seat venue playing host to a variety of live entertainment, concerts, recitals, drama, comedy, dance and grand opera. The Belltable, Limerick, is the principal Arts Centre in the Shannon Region offering the best of theatre, music, dance, visual arts, and cinema, while Glór Irish Music Centre, located in Ennis, Co. Clare, provides a variety of styles, traditions and genres of live music as well as other arts activities.

The €14m Sports Arena at University of Limerick includes four multipurpose basketball courts, a 60m sprint track, a suspended 225m jogging track, gymnasium and health and fitness centre, 50m Olympic Size swimming pool, diving pool and Astroturf all-weather pitches. The recently completed Thomond Park Stadium, home of Munster Rugby, also offers a range of hospitality suites for large scale conferences and events.

High-quality education is available for all ages, with schools at both primary, post-primary and third level colleges to meet the specific needs of families relocating to Shannon.

The needs of families with children at pre-school age are also well-catered for in the Region.

A wide choice of residential property is available, from modern executive houses to older, traditional homes in a range of urban, suburban and rural living. Housing costs in the Shannon Region is almost 34% lower than in Dublin on the East Coast. The average house price in the Region is €204,524 versus €306,795 in Dublin.

Housing costs in the Shannon Region versus Dublin is almost

34% lower

Regional Health Services are excellent with three acute hospitals within a 50 mile radius, as well as access to good-quality dental and private medical facilities.

Shannon is well-served by a highquality road network which is supported by a first-class public transport system. This offers very short commuting times, typically between 10 and 30 minutes, for people living and working in the town, or from surrounding towns such as Ennis and Limerick. These compare very favourably with those of major urban centres such as Dublin, where commuting times in excess of 90 minutes are not unusual.

41

42

Contact Details: Shannon Tourism Investment Team Tourism Product Development Shannon Development Shannon Co Clare T:

+353 61 361 555 tourisminvestments@ShannonDevelopment.ie W: www.ShannonDevelopment.ie E:

Disclaimer: While every effort has been made to ensure accuracy in this publication, Shannon Development does not accept responsibility for any errors or omissions.

April 2010