Monday, September 22, 2025

Why does every US and Chinese company want to go to Ireland?

Ireland is one of the biggest winners of the EU 27 construct.  It has established itself as a tax and regulatory haven for foreign (non-EU) companies.  Virtually all Chinese and American companies, in particular in tech, rush to “establish” themselves in Ireland.  In exchange, they get to pay a low corporate tax rate (even if their users and their money is made in the other 26 EU countries) and they get to benefit from the light-touch privacy regulation of Ireland.  

You’ll recall that Europe’s tough (on paper) General Data Protection Regulation of 2018 created the concept of a one-stop shop for foreign companies.  So, any Chinese or American company could pick one of the EU countries as its “establishment”.  Of course, they all picked Ireland, given its universal reputation for light-touch tax and regulation.  It is entirely a different debate about why/how Europe made this blunder:  in effect, it gave a massive advantage to foreign companies over domestic European companies.  A French/Italian/Spanish company would be regulated by their domestic French/Italian/Spanish regulators, who take privacy seriously, and would sanction non-compliance.  But a Chinese or American tech company would do business in all those countries, while benefiting from the Irish regulatory culture, as gentle as an Irish mist.  


Occasionally, a European regulator would try to take on an American or Chinese company in the field of privacy.  https://www.cnil.fr/en/cookies-placed-without-consent-shein-fined-150-million-euros-cnil

But this action wasn’t based on the core European privacy law, the GDPR, but on a rather obscure law about other things.  


The Trump administration has defended American companies in Europe against what it claims are discriminatory regulatory actions.  https://www.lemonde.fr/en/international/article/2025/09/06/eu-commission-reluctantly-fines-google-nearly-3-billion-despite-trump-threat_6745092_4.html#  It was therefore not a surprise to see the French regulator announce fines at the same time against one American and one Chinese company.  But it is surprising to see the Trump administration rushing to defend one of the most Democratic-leaning companies in the US.


Indeed, Europe does discriminate, in the field of privacy, in favor of non-EU Chinese and American companies, due to the one-stop-shop Irish backdoor.  One can only assume European dysfunctional politics led to this absurd result, from a European perspective.  Hundreds of millions Europeans depend on a small Irish privacy regulator to ensure that the gigantic American and Chinese tech companies respect European privacy laws.  Hilarious.  


All of this might seem like trivial corporate politics, but the consensus is growing that humanity is allowing the tech industry to put us (I mean, our entire home sapiens species) on a path to doom.  https://www.theguardian.com/books/2025/sep/22/if-anyone-builds-it-everyone-dies-review-how-ai-could-kill-us-all  Even if we’re doomed, can we at least put up a fight?