EU Approves Measure Designed To Boost Irish Shipping

by Ulrika Lomas, for LawAndTax-News.com, Brussels

25 November 2005

The European Commission announced on Wednesday that it has approved the extension by the Irish authorities of a refund scheme for social security contributions made by employers of seafarers on certain ships.

One of the aims of the scheme is to promote the employment by ship operators of Irish tax and social security liable seafarers.

The Commission first approved the scheme, which covers Pay Related Social Insurance (PRSI) contributions, in September 1999 for a period running up to 2004. It has now given approval for its extension up to 31 December 2010.

With this measure, the Irish authorities intend to:

• Make the recruitment or maintenance in employment of Irish tax and social security liable seafarers more attractive to Irish ship operators, thereby maintaining/increasing the number of EU seafarers on Irish flagged vessels;
• Make the Irish flag more competitive, thereby promoting employment, maintaining vessels under the Irish flag and attracting non-Irish ship-owners to locate in Ireland;
• “Level the playing pitch” vis-à-vis low labour-cost competitors, thereby enhancing the competitiveness of Irish ship operators; and
• “Increase the pool of maritime expertise in Ireland, thereby stimulating an increase in marine-based activities and in the development and exploitation of the extensive offshore and coastal marine resource.

The scheme is expected to cost up to €4 million per year and to apply to approximately 1,300 seafarers employed by some 10 ship operators.

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