Seamus Fives: Ireland is ideally placed to become the digital regulatory hub for Europe

The American Chamber has published its white paper, ‘Ireland; Regulating for Europe’s digital future’, outlining why Ireland is well positioned as an EU digital regulatory hub, and highlighting how this has the potential to bolster innovation from industry and enhance Ireland’s overall competitiveness.

As a rules-based democracy underpinned by law and transparency – along with highly experienced regulatory bodies – Ireland is a regulatory hub for the digital sector within the EU. This reflects the strong presence of US multinational corporations in Ireland, now numbering approximately 950 companies, many of which have chosen to locate their European or EMEA headquarters here.

Ireland’s position as a regulatory hub within the EU has developed naturally and as a result of the success of Ireland’s inward investment strategy. It has resulted in key functions being placed in Ireland and the implementation of EU regulation based on the ‘country of origin’ principle. For instance, a significant amount of EU-wide regulation takes place in Ireland in the areas of consumer protection, communications and telecommunications, data protection and financial services.

Many of the tools and experiences needed to transform Ireland into a centre of excellence for regulation, and to strengthen its position as a regulatory hub, already exist. Building on the regulatory framework, ensuring our European partners understand the commitment and expertise of Irish regulators, and addressing delays in the transposition of key EU regulations into domestic law will be pivotal in showcasing Ireland’s commitment to digital regulation. As we look to the future and anticipate additional EU regulations on the horizon, there is an opportunity for Ireland to demonstrate its continued commitment to serving as a regulatory hub for the benefit of the EU as a whole.

In our ever-digitising world, businesses are subject to increasingly complex regulation. The challenge for Ireland in remaining at the centre of this activity is to provide consistent, balanced and responsible regulation that gives certainty for business while also fostering innovation. ‘Harnessing Ireland: the Digital Ireland Framework’ is a positive signal of intent by Government in supporting the digital environment. Translating this into action will be key to bolstering Ireland’s attractiveness and protecting the country’s position as a regulatory hub. To give it further impetus, AmCham recommends the future reshaping of cabinet portfolios to reflect the importance of cyber, data and digital to the Irish economy.

It is also essential that Ireland takes proactive positions on key issues under consideration at EU level, particularly in the areas of AI, cyber, data, digital, and Industry 4.0, for example by leveraging the industry expertise based in Ireland to inform technical consideration of future regulation at EU level, and by communicating to European partners how Ireland’s position as a digital regulatory hub can spur innovation to benefit the EU as a whole.

Ireland’s status as an EU regulatory hub has allowed Irish regulators to develop world-class skills in ‘good regulation’. Factors such as the ‘country of origin’ principle and the ‘one-stop-shop’ under the General Data Protection Regulation (GDPR) have supported the development of regulatory excellence in Ireland. The ‘one-stop shop’ under GDPR allows an organisation to deal with one lead supervisory authority in relation to their processing activities.

The Irish DPC fulfils this function on behalf of over 440 million people across the EU. Of fundamental importance is ensuring Ireland’s work in this area is understood Europe-wide and that any negative perceptions which may exist are challenged. In contrast to a sometimes-negative perception of its enforcement of the GDPR, both the number and the value of the fines levied by the Irish DPC demonstrate its ability to enforce effective data protection.

The expectations on Ireland as a digital regulatory hub within the EU will increase in the context of the Digital Services Act, and additional, critical pieces of legislation being implemented and being developed at EU level. It is essential that Ireland focuses on providing the investment and commitment required to resource our regulatory functions and maintain our role as a digital regulatory hub.

Spurring innovation in Ireland will be key to achieving this goal, as will ensuring Ireland has a strong voice at the European table on all matters related to digital, data, cyber, AI and Industry 4.0. This viewpoint of AmCham members aligns with the ambition outlined in the State’s digital strategy which focuses on good regulation and Ireland’s role in the wider European context.

It is also essential that Ireland takes proactive positions on key issues under consideration at EU level

Ireland’s role as a regulatory hub has the potential to enhance Europe’s overall competitiveness and enhance the bloc’s attractiveness for inward investment. In her address to the Joint Houses of the Oireachtas, European Commission President Ursula von der Leyen said: “Ireland is Europe’s springboard over the Atlantic… Two centuries of emigration have given Ireland an unparalleled soft power and diplomatic network… And there are few countries more skilled than Ireland at leveraging the influence and friendship of a historic diaspora.”

The opportunities for Ireland to enhance its position as an EU digital regulatory hub and become a centre of excellence are significant. The publication of Ireland’s national digital strategy has been positive. Turning its ambition into reality must now be a key priority for government, and doing so in a manner which enhances the perception of Ireland on the European stage will be vital in strengthening Ireland’s role in the EU’s regulatory ecosystem.

Seamus Fives is President of the American Chamber of Commerce Ireland