By Mark Bollard, Managing Director, Business Development, International Funds
At a glance
The global ETF opportunity
The ETF industry shows no sign of slowing as investors place greater value on transparency, liquidity, cost efficiency and accessibility. Active ETFs are a particularly important area of expansion, with traditional asset managers adopting ETF structures to meet changing client preferences.
While the United States remains the largest ETF market, adoption is accelerating across Europe, Asia-Pacific, the Middle East and Latin America. Investors in many of these regions often prefer UCITS-compliant products, meaning international expansion is a clear opportunity for U.S. managers.
However, successful international distribution requires navigating regulatory requirements, operational infrastructure, investor preferences, distribution networks and tax considerations. The challenge is not simply launching an ETF, but building a scalable international platform.
Why Ireland stands out
Ireland has established itself as a leading centre for international investment funds and ETFs. Over two decades, it has built a comprehensive ecosystem that includes management companies, administrators, custodians, depositaries, legal advisers, tax specialists, authorised participants, market makers, exchanges and distribution experts.
Today, Ireland hosts approximately 78% of European ETF assets under management, representing around USD 2.5 trillion.
For U.S. asset managers, Ireland offers a familiar and well-established environment. Many of the world’s largest ETF sponsors already use Irish structures for their European and international product ranges, meaning service providers have extensive experience supporting U.S. firms entering global markets.
Understanding the Irish ManCo model
A defining feature of the Irish funds industry is the ManCo model.
Rather than building extensive local infrastructure, U.S. managers can leverage an authorised third-party ManCo to perform key responsibilities, including:
- Regulatory oversight
- Risk management
- Compliance monitoring
- Fund governance
- Operational oversight
- Delegate monitoring
- Regulatory reporting
Investment management can usually remain with the U.S. portfolio manager through delegated arrangements, subject to applicable regulatory requirements and oversight frameworks, while governance and oversight responsibilities are managed locally.
The ManCo remains ultimately accountable for delegated functions and must demonstrate effective oversight, challenge and substance.
This structure offers several advantages:
- Reduced infrastructure requirements: Managers can access a regulated European framework without establishing a large local presence
- Faster market entry: Established ManCos bring launch expertise, regulatory experience and proven operational processes
- Scalability: Firms can focus on portfolio management, distribution and client relationships, while specialist providers handle governance and oversight
For firms entering Europe for the first time, the ManCo model can significantly lower barriers to entry.
Active ETFs go global
The rise of active ETFs represents an important trend in global asset management. Many U.S. managers with successful active strategies are now exploring UCITS ETFs as a route to new investor segments.
A UCITS ETF can provide access to:
- European wealth managers
- Institutional investors
- Private banking networks
- Global advisory platforms
- International distribution channels
Managers should, however, recognise that UCITS requirements differ from those applicable to U.S. 1940 Act funds. Key considerations include diversification limits, eligible asset requirements, liquidity standards, counterparty exposure restrictions and portfolio transparency obligations.
The most successful launches address these considerations early in the product development process.
Tax efficiency considerations
Tax considerations remain an important factor in domicile selection.
Ireland offers a well-established and internationally respected funds tax regime, including:
- No Irish taxation at fund level on investment gains
- No Irish withholding tax for most non-Irish investors
- Access to an extensive treaty network
- Significant experience supporting cross-border fund structures
Ireland’s treaty relationship with the United States can open up meaningful efficiencies for certain strategies, underlying asset classes and investor bases, subject to specific fund structures, investment activities and investor circumstances.
Although tax should not be considered in isolation, it can strengthen Ireland’s overall proposition when combined with regulatory, operational and distribution advantages.
Capital markets and ETF trading infrastructure
ETF success depends not only on investment performance but also on trading efficiency and liquidity.
U.S. managers entering Europe face a market structure that differs considerably from that of the United States. ETF liquidity is fragmented across multiple exchanges, substantial volumes trade over-the-counter and market makers play a central role in providing liquidity.
A successful European ETF programme requires coordination among:
- Authorised participants (APs)
- Market makers
- ETF capital markets specialists
- Depositaries
- Custodians
- Administrators
Ireland’s mature ETF ecosystem affords access to providers with extensive experience supporting these requirements, helping managers navigate the complexities of European market structure.
Distribution is the real test
Launching an ETF is only the first step. Asset gathering is often the bigger challenge.
Although the UCITS passport facilitates cross-border marketing within the European Union, successful distribution still requires:
- Country registrations
- Platform access
- Distribution agreements
- Regulatory marketing compliance
- Local market expertise
Investors access UCITS ETFs through multiple channels, including private banks, wealth managers, institutional consultants, fund platforms, insurance wrappers and pension schemes.
The strongest ETF launches combine effective product capabilities with a well-defined distribution strategy and clear commercial objectives.
Governance as a differentiator
The Central Bank of Ireland oversees a robust regulatory framework for investment funds and service providers.
Irish fund structures place significant emphasis on governance and accountability through:
- Independent directors
- Board oversight
- Designated persons
- Risk management frameworks
- Delegate oversight
- Formal governance reporting
While some firms initially view these requirements as additional obligations, many ultimately see them as a source of credibility with institutional investors and distribution partners.
Ireland’s role in the next phase of ETF growth
As ETF markets become more interconnected, U.S. asset managers need strategies that extend beyond their domestic investor base. Ireland provides a proven platform for achieving that goal.
Through the UCITS framework, managers gain access to a globally recognised investment structure. With the ManCo model, they can leverage established governance, regulatory and operational infrastructure without the need for extensive local resources. Through Ireland’s ETF ecosystem, they gain access to specialist expertise shaped by decades of market development.
For U.S. asset managers seeking scalable international distribution, Ireland is more than a fund domicile. It is a proven gateway to global investors, operational efficiency and long-term growth.
How IQ-EQ can help
At IQ-EQ, we help U.S. asset managers establish and grow ETF and fund structures in Europe by providing the regulated infrastructure, oversight and local expertise required to operate in the region.
Acting as your third-party ManCo, we’ll coordinate with European regulators and service providers on your behalf while delivering the right regulatory oversight, governance frameworks and board reporting to meet UCITS requirements.
Beyond Management Company services, we provide a coordinated approach across product structuring, ManCo oversight, investment management, registration support and the wider ETF operating ecosystem, helping managers navigate launch and growth with greater efficiency.
Discover our full suite of services and get in touch with our expert team today.
About the author
Mark Bollard is a Managing Director on our International Funds Team, based in New York. He is responsible for cross-border sales, supporting U.S. managers who are looking to expand or establish their presence in Europe. Mark was previously a Client Relationship Director in London and prior to that, he spent several years as a Portfolio Manager in our Irish office.
