Ireland is one of Europe’s top destinations for global business expansion, offering an investor-friendly tax regime, skilled workforce, and easy access to EU markets. Notably, Ireland pioneered free trade zones in Europe by establishing the Shannon Free Zone in 1959 — the world’s first customs-free industrial zone.
Free zones are designated commercial areas where companies benefit from customs exemptions and simplified trade regulations. Many international companies strategically choose to locate within these zones to reduce costs, streamline logistics, and access global markets more efficiently.
In this updated guide, we’ll explore everything you need to know about setting up a business in the Shannon Free Zone in Ireland — its key advantages, allowed activities, major sectors, and how you can get started.
What is the Shannon Free Zone in Ireland?
The Shannon Free Zone (SFZ), established in 1959, is globally recognised as the first free trade zone. Spanning over 600 acres next to Shannon Airport in County Clare, the SFZ is a well-developed business park hosting more than 150 companies and employing over 8,000 skilled professionals.
Businesses operating in the Shannon Free Zone enjoy unique trade and tax benefits, minimal customs restrictions, and access to a robust transport network by air, road, and sea. This makes the SFZ a prime hub for companies targeting the European, US, and Asian markets.
Why Establish a Business in Shannon Free Zone in Ireland?
The Shannon Free Zone remains a cornerstone of Ireland’s Foreign Direct Investment (FDI) strategy, attracting multinational corporations across diverse industries. Here are the compelling reasons to set up your company in this strategic location:
- VAT & Customs Exemptions: Companies can import raw materials VAT-free, provided at least 75% of finished products are exported outside Ireland or the EU.
- Low Corporate Tax: Benefit from Ireland’s competitive 12.5% corporate tax on trading profits.
- Strategic Location: Direct connectivity to Shannon Airport facilitates seamless air freight and passenger travel, linking Europe to North America and Asia.
- Cost Efficiency: The ability to store raw materials and stock at low cost enhances supply chain efficiency.
- Robust Workforce: Access to a well-educated, English-speaking talent pool and strong R&D ecosystem.
- Business Support: Eligibility for grants and support from IDA Ireland and the Shannon Group for investment, employment, and innovation.
Permitted Activities in the Shannon Free Zone
Companies operating in the Shannon Free Zone are allowed to engage in a variety of activities, subject to compliance with Irish customs and revenue regulations. Some of the key permitted activities include:
- Aircraft Maintenance & Repair: One of the zone’s most prominent sectors due to its proximity to Shannon Airport.
- Manufacturing & Processing: Production of goods for export.
- Research & Development (R&D): Innovation labs and technology testing centres.
- Trading & Logistics: Import-export operations for approved goods.
- Intellectual Property (IP) Activities: Registration and management of patents and trademarks.
Note: Certain trading activities may require prior approval from Ireland’s Department of Finance.
Key Sectors in Shannon Free Zone
Over the years, the SFZ has evolved into a diversified cluster of industries. Major sectors thriving within the zone include:
Aviation & Aerospace
Home to world-class MRO (Maintenance, Repair & Overhaul) companies serving global airlines.
Engineering & Advanced Manufacturing
Precision engineering firms and component manufacturers take advantage of the zone’s skilled workforce and logistical benefits.
Pharmaceuticals & Medical Devices
Companies focus on high-quality production and distribution across EU and non-EU markets.
Information & Communication Technology (ICT)
Software development, information technology services, and telecom companies benefit from Ireland’s strong digital infrastructure.
International Business Services
Finance, insurance, and back-office support centres leverage Ireland’s business-friendly environment.
How to Register a Business in Shannon Free Zone?
Starting a company in the Shannon Free Zone involves these key steps:
- Choose Your Business Structure: Most investors set up a Private Limited Company (Ltd) for liability protection.
- Register with the Companies Registration Office (CRO): Ensure compliance with Irish company law.
- Apply for Zone Authorisation: Secure approval from Shannon Group and relevant customs authorities for your specific activities.
- Set Up Tax Registration: Register for tax numbers with Revenue Ireland.
For detailed guidance, see Company Registration in Ireland.
Conclusion
The Shannon Free Zone in Ireland is a thriving gateway for global businesses seeking an efficient entry point into Europe. With its strategic location, investor-friendly tax regime, and modern infrastructure, the SFZ continues to drive Ireland’s reputation as a hub for innovation and trade.
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FAQ’s
Yes. The Shannon Free Zone remains fully operational, hosting over 150 companies and continuing to attract new investments.
Aviation, engineering, pharmaceuticals, IT services, and logistics companies gain significant benefits from the zone’s customs and tax incentives.
Absolutely. The zone offers excellent air and sea connections, making global exports efficient and cost-effective.
The zone is managed by the Shannon Group — Ireland’s statutory body for Shannon Airport and its business parks.
