Irish officials worried MiFID to hit stocks

13/07/2008 12:05

DUBLIN (Reuters) - Officials at Ireland’s finance ministry are worried that the European Union’s new securities trading rules and Irish taxes levied on buying shares could hurt Irish stocks, the Sunday Business Post reported.

Last year’s Markets in Financial Instruments Directive (MiFID) introduced far-reaching changes to how shares and other securities are traded cross-border, in order to create a single financial market spanning the European Union’s 27 member states.

According to "high-level briefing documents" seen by the Sunday Business Post, officials worry MiFID may encourage Irish investors to buy stocks abroad, while a duty levied on share purchases here could limit foreigners’ interest in Irish stocks.

"Foreigner investors may move away from Irish shares, given that Ireland and the UK are the only EU states with a ’substantial’ stamp duty charge," the paper quoted officials as saying.

A spokesman for the ministry could not immediately comment on the report.

The ISEQ <.ISEQ> index of leading Irish shares has fallen by more than half since hitting an all-time high in May 2007, as global economic woes have added to fears that Ireland’s more than decade-long ’Celtic Tiger’ boom will turn to recession in 2008.

"The documents contain a warning from top officials .....continued below

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that ’interest in Irish shares may become an issue over the next period’ as a result of the EU’s Markets in Financial Instruments Directive," the paper said.

(Reporting by Andras Gergely; Editing by Quentin Bryar)

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