Irish Debt Securities Association (IDSA) launch in 2013 with Minister Richard Bruton, IDSA CEO Gary Palmer, and IDSA Chairman Turlough Galvin of Matheson's Tax Practice.Matheson Foundation Chairman Turlough Galvin, and Irish TaoiseachLeo Varadkar, honour 150 children from the Centre for Talented Youth Ireland (CTYI) in 2016.
Matheson (previously Matheson Ormsby Prentice), is an Irish law firm partnership based in the IFSC in Dublin, which specialises in multinational tax schemes (e.g. for clients in Ireland such as Microsoft, Google[4] and Abbot[5]), and tax structuring of special purpose vehicles (e.g. Section 110 securitisation SPVs). Matheson is estimated to be Ireland's largest corporate law firm.[3][6] Matheson state in the International Tax Review that their tax department is: "significantly the largest tax practice group amongst Irish law firms".[7]
History
While Matheson's website traces their history back to 1825 and notes that their offices were burnt in the Irish Easter Rising of 1916,[8] it wasn't until after the creation and initial development of Dublin's International Financial Services Centre (or IFSC) that Matheson emerged as a small but standalone law firm with 14 partners and over 50 solicitors (or lawyers) in 1991.[9]
In 1996, the firm moved to a dedicated office at 30 Herbert Street in Dublin. The property was developed by Treasury Holdings and designed by Arthur Gibney & Partners architects.[10][11][12]
It later moved to offices at 70 Sir John Rogerson's Quay in 2007,[13] and rebranded as "Matheson" in October 2012.[14]
While A&L Goodbody and Arthur Cox still lead Irish corporate law,[3] Matheson has grown with the rise in the IFSC to become one of Ireland's five largest corporate law firms along with McCannFitzgerald and Mason, Hayes and Curran.[6] Matheson focuses on the two legal areas most associated with the IFSC, namely tax structuring for U.S. multinationals,[4] and creating IFSC–domiciled corporate tax structures and tax efficient vehicles for various asset management and asset financing activities (particularly securitisation special purpose vehicles, which the IFSC leads in the EU–28).[15][16]
Matheson's leadership in the area of U.S. multinational tax planning in Ireland,[4] a jurisdiction which is ranked as one of the world's top corporate havens[21] has seen Matheson win major awards from the international corporate tax planning industry, including:
Matheson's leadership in the Irish tax strategies of U.S. multinationals, (or BEPS tools), has attracted attention from U.S. media over the years. In 2005, the Wall Street Journal ran a story on how Microsoft used an Irish subsidiary called "Round Ireland One" to avoid billions in U.S. taxes which was structured and registered in Matheson's offices (was then Matheson Ormsby Prentice, or MOP).[26][27] In 2013 the Wall Street Journal ran another investigation showing that the scale of U.S. operations in Ireland, using Matheson registered tax structures, had dramatically increased from 2005.[4] These strategies has seen Ireland labelled as one of the world's largest corporate tax havens,[21][28] and blacklisted by Brazil.[29][30][31] In 2019, it was reported that Abbott used Matheson to avoid billions in U.S. taxes.[5]
Mainstream U.S. media channels have singled out Matheson in Dublin, as a significant centre for U.S. multinational tax strategies.[34]
In this regard, Matheson is akin to the situation of Irish PwC Managing Partner Feargal O'Rourke, whose development of the double IrishIP–based BEPS tool, has also made him the subject of investigative pieces by the U.S. financial media.[35] Bloomberg recognise that O'Rourke, while being at the vanguard of legitimate but aggressive U.S. multinational tax planning, is considered a "hero" in Ireland.[36]
In 2016, Matheson was criticised in the Irish media when it was revealed that U.S. distressed debt funds (known pejoratively as "vulture funds" in the Irish media),[37] had used the services of Irish IFSC securitisation law firms to avoid billions in Irish taxes,[38][39] on Irish distressed assets by using Irish Section 110 SPVs.[40][41][42][43][44] These structures were created so IFSC law firms could administer global securitisation transactions.[45][46] Matheson featured as one of the most frequently used advisors by the U.S. distressed debt funds (with A&L Goodbody).[47][48][49]
The affair escalated into the "vulture fund tax avoidance" scandal,[50] when it was found Matheson used three in-house children's charities (Eurydice, Medb and Badb),[51][52][53] to make the Irish Section 110 SPV work in an Irish domestic setting (known as "orphaning").[54][55] This was a purpose for which Finance Minister Michael Noonan acknowledged "the Section 110 legislation was not set up for".[56] The affair became a major Irish scandal[57][58] and was reported in the international media.[59][60] The Irish State closed the loopholes,[61][56] and prohibit Irish charities from being used in tax avoidance structures.[62][63]
It was revealed in the Irish section of the Panama Papers leak of 2016, that a senior partner in Matheson, Stanley Watson, had established an offshore tax structure with Mossack Fonseca's help in Cyprus, to reduce his tax bill on moving to London to set up the Matheson London office.[64][65] A woman in the Matheson Dublin office was helping handle the correspondence to establish the structure.[64] The affair caused further embarrassment for Matheson when Stanley Watson's Isle of Man advisor was recorded as describing Matheson to Mossack Fonseca as "our biggest client".[64]
^ abcdDamian Paletta; Kate Linebaugh (15 October 2013). "Dublin Moves to Block Controversial Tax Gambit". Wall Street Journal. Retrieved 19 March 2019. At least 125 major U.S. companies have registered several hundred subsidiaries or investment funds at 70 Sir John Rogerson's Quay, a seven–story building in Dublin's docklands, according to a review of government and corporate records by The Wall Street Journal. The common thread is the building's primary resident: Matheson, an Irish law firm that specializes in ways companies can use Irish tax law.
^ abPeter Bodkin (19 March 2019). "How the IDA's top client used Ireland to siphon billions offshore tax-free". TheJournal.ie. Retrieved 19 March 2019. Meanwhile, through a myriad of subsidiaries and system of inter-company charges involving a variation on the infamous so-called 'double Irish' structure, its local operations have also legally shaved their tax bills with the Exchequer despite pulling in huge sales. The firm's registered office is listed as the address of its Dublin law firm, Matheson.
^Our tax department is significantly the largest tax practice group amongst Irish law firms. "Matheson Ireland Profile". International Tax Review 2017. 2017.
^"Maples and Calder Irish Intellectual Property Tax Regime - 2.5% Effective Tax". Maples and Calder. February 2018. Structure 1: The profits of the Irish company will typically be subject to the corporation tax rate of 12.5% if the company has the requisite level of substance to be considered trading. The tax depreciation and interest expense can reduce the effective rate of tax to a minimum of 2.5%.
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