Ireland is the firmly established engine room of Europe’s exchange-traded funds market, reveals new research from EY Ireland. The company’s EMEIA ETF Leader, Lisa Kealy, says the country has 70 percent of all European Exchange Traded Funds (ETFs), and that it is seeing much growth in active ETFs, of which it has a 94 percent share. That’s quite a success story considering that the value of European domiciled ETFs surged to €2.7trn, growing by 41 percent in 2025 alone.
“It didn’t happen by accident: It was due to hard work to present ourselves as a centre of excellence,” Kealy remarks. Blackrock, Vanguard, State Street – the top three institutional investors – chose to set up in Ireland because the infrastructure is highly developed to support their products. The country has also developed a role for itself that goes far beyond being a popular fund domicile.
“Because they set up here, everyone else followed, and now Ireland is seen as the centre of excellence for ETFs,” she explains. The Undertakings for Collective Investment in Transferable Securities (UCITS) framework, and Ireland’s understanding of the nuances of ETFs, redemptions, and how ETFs trade on the secondary market, have all been factors that have helped. Trust with passive ETFs has facilitated interest in active ETFs too.
Positive growth driver
On a global scale, ETFs have also been a positive growth driver – pushed along by increasing transparency, liquidity, cost-efficiency and accessibility. Kealy says UCITS has been an important building block to Ireland’s success. It is an EU regulatory standard that harmonises the regulation of investments funds, allowing them to be managed and sold across Europe with a single passport. It focuses on investor protection by enforcing strict diversification, liquidity, and transparency rules for retail investment products.
Irish service providers have built seamless connectivity to the ETF ecosystem
Comparing the experience of Luxembourg with Ireland, she explains: “The UCITS brand and regulatory framework really opened the door for us when it came to ETFs. It wasn’t going to guarantee leadership, but it did open the door. While Luxembourg had a great opportunity, scale didn’t come automatically. What differentiated us in Ireland and gave us leadership was the ability to really scale – establishing ourselves as a centre of expertise, by really understanding daily transparency, in-kind creations and redemptions, the listing structure, the settlement structure, and how ETFs are actually traded on the second trip.
“It is about how you can create and redeem blocks of capital with authorised participants (APs), or market makers (MMs), that whole creation subscription structure. We needed to really understand it all and to make sure that they traded really well on the secondary market. We understood that ETF mechanics and the regulation. And it was that investment of, you know, knowledge, technology, people and process that created our centre of excellence in Ireland.”
Disproportionate share of ETFs
Deborah Fuhr, CFA Fellow, Managing Partner and Founder of ETFGI, says her firm’s data shows that Ireland captured a disproportionate share of ETF launches and assets. She thinks Ireland also benefits from its operational efficiencies when it comes to fund administration, depository, legal, tax, and capital markets expertise – and compared to European centres it has a predictability of regulation, and it benefits from being an English-speaking country. More to the point, she says once Ireland became the default ETF domicile, its ability to scale reinforced itself.
“UCITS was the enabler; Ireland’s execution made it decisive,” she claims. As for Ireland’s key differentiators, she cites ETF-specific regulatory interpretation, faster authorisation timelines, and she finds that the country is comfortable with complex synthetic, fixed income and active structures. Subsequently a majority of European active ETF assets are domiciled in Ireland, and she says that is despite active ETFs still being a minority of total ETF assets.
However, Ireland’s regulators were early and pragmatic on non-transparent and semi-transparent models, and while there has to be a certain degree of portfolio disclosure flexibility, “Ireland already hosted the largest concentration of fixed income ETFs, which translated naturally into active adoption,” she notes.
With US active ETF sponsors expanding into Europe, and defaulting to Ireland, she believes this signals that Europe’s next phase of ETF growth is active, fixed income, and outcome orientated. As for Ireland’s portfolio disclosure flexibility, which is particularly relevant to daily disclosures, Kealy interjects: “The Central Bank of Ireland has recalibrated the daily transparency requirements for active ETFs to balance investor protection, market efficiency and intellectual property. Transparency works well for passive ETFs because the managers are holding a very broad index. That can create issues for active strategies because it risks institutional investors front running that fund, if it makes sense, because the whole portfolio is disclosed.” Its regulatory approach is helped by engaging closely with industry.
Complexity: Leaping the moat
Ciarán Fitzpatrick, Global Head of ETF Product at JPMorgan, adds that fund administration, capital markets expertise and specialist talent are critical to sustaining Ireland’s leadership. In fact, he describes them as the moat. “Ireland’s model is not simply a legal domicile; it is a scaled operating platform and infrastructure,” he explains before commenting that Irish Funds have stressed the “breadth and depth of service capability and the highly automated and scalable global solutions” available to issuers there.
The country’s ecosystem has also evolved beyond asset servicing into broader front-office expertise spanning capital markets including APs located in Ireland, product development, innovation and global distribution. “This matters more – not less – as the industry shifts toward active ETFs, outcome-oriented strategies, derivatives overlays and new operating models such as tokenisation,” Fitzpatrick suggests.
Fuhr adds: “Evidence shows that ETF success correlates strongly with primary/secondary market efficiency, and Ireland specialist ETF administrators, AP-facing capital markets desks, lawyers, tax experts and index specialists.” The moat is being created by ETFs becoming more complex, by adding operational depth and not just regulation.
APs: Full liquidity support
Fitzpatrick says the role of APs and MMs is vital, helping to provide full liquidity support to the ETF ecosystem, while also “underpinning the creation and redemption mechanism that connects the secondary market (where investors trade) to the primary market (where ETF shares are created or redeemed).”
Market Makers also support two-way pricing, absorb and manage intraday flows. “As ETF usage becomes more retail and more mainstream, this connectivity becomes more visible – and more sensitive,” Fitzpatrick explains before highlighting that “Irish service providers have built seamless connectivity to the ETF ecosystem, including APs and MMs.”
He adds: “When the operating model evolves, regulators naturally focus on who provides liquidity, how it is monitored and managed, and how contingency plans are governed. This is a regulatory priority to ensure that investors are being serviced transparently and that markets supporting them are functioning efficiently.”
His colleague, Fearghal Woods, Ireland Securities Services Head at JPMorgan, describes the way active ETFs are challenging traditional transparency and disclosure requirements: “Active ETFs put pressure on the classic ETF norm of frequent portfolio disclosure. Managers want the benefits of the ETF wrapper, and they also want to protect intellectual property and reduce the risk of front-running. Ireland’s central bank has been very responsive in this regard and has introduced a flexible portfolio transparency regime for both active and passive ETFs, allowing portfolio holdings to be disclosed up to quarterly, with a lag of up to 30 business days to avoid any concerns of front-running.”
The response of the Central Bank of Ireland has been to permit ETF share classes within mutual funds, he reveals, letting firms deliver ETF features through existing structures without a separate legal vehicle. “However, this may and can present some operational challenges for the fund that any issuer needs to consider carefully,” Woods reports before commenting: “For issuers it does demonstrate a desire to support active product innovation while keeping the regulatory regime coherent and scalable.”
Heightened scrutiny
Not everything is rosy. Ireland’s dominance also brings heightened scrutiny. While ETFs now represent a significant share of Ireland’s funds industry, with industry reports suggesting that they account for roughly 32 percent of total Irish‑authorised fund assets, there are structural shifts that are re-shaping demand. Therefore, younger investors, digital platforms, neobanks and robo-advisers are accelerating ETF adoption across Europe – leading to significant growth in active ETFs.
Ireland’s ability to support innovation – while maintaining regulatory credibility – will be critical to sustaining its leadership position over the next few years, particularly as assets are forecast to exceed €5trn in Europe by 2030. To achieve this, Ireland is going to need to continue to innovate. So with the young banking through the likes of Revolut, and offered ETF products through it, access to ETFs should increase.
While apps need to play a role in attracting the young, there is also a need for financial literacy to complement the Savings Investment Union, and to promote ETFs as low-cost, liquid products that are highly accessible to investors. Kealy thinks this could create a good saving habit for young people who tend to engage through apps and use automated forms rather than go to an investment adviser.
“ETFs enable access through the apps and the digital platforms that investors are looking to access, so I think it is really important in terms of our culture at a European level,” she comments. The trouble is that Europeans are good savers, but not necessarily good investors. The challenge is therefore to change the culture from a savers’ one to an investors’ culture for young people in Europe. To Kealy, ETFs are the ideal vehicle for achieving this transformation.
Risks remain
Recent reviews by the Central Bank of Ireland highlight that while the Irish ETF ecosystem has functioned effectively during both normal and stressed market conditions, risks remain. In particular, the concentration of activity among a relatively small number of APs and MMs raises questions about liquidity resilience, governance, and contingency planning. The regulator has also emphasised the need for stronger oversight, board‑level reporting, and more robust monitoring frameworks to ensure that ETF liquidity mechanisms remain robust as the market scales.
Europeans are good savers, but not necessarily good investors
Ireland can nevertheless maintain its dominance if it can avoid being complacent – taking what has been achieved for granted. The world is competitive, and so Ireland can’t afford to sit on its laurels. As Kealy says, Luxembourg is fighting hard to create a really strong ETF ecosystem.
She concludes: “So we need to work harder to continue to earn our position each and every year. This means we need to continue to develop Ireland’s ETF market infrastructure, and to collaborate with the leaders and the managers in the US and the UK to ensure that we have the best ecosystem and that we are really innovative and quick in responding to their needs.”
Work to be done
In Kealy’s view there is still work to be done. For example, there is a need to fix the disconnection around domestic participation, and the domestic block – the tax issue to create an investment culture in Ireland by implementing a favourable tax regime for investors. “You do this by ensuring there is no tax block on Irish people investing in our ETF industry,” she explains.
An opportunity to continue to lead the transformation of the market, encouraging more investors than savers, begins on July 1, 2026, when Ireland takes on the EU presidency. It will allow Ireland to create more harmonisation and standardisation, as well as more digital infrastructure around ETFs – enabling Ireland to promote a smart approach to leading in this area.
Woods also says maintaining Ireland’s leadership is about scaling the operating model by continuing to invest in automation and talent, enhancing the regulatory framework, and enabling innovation without undermining confidence. A key part of this will be to expand ETF and new product capabilities while enhancing investor protection with ongoing regulatory pragmatism. Fuhr summarises it by saying that “Ireland’s lead is structural, not accidental – but leadership must be continuously earned.”
