A career diplomat, French ambassador Stéphane Crouzat has kept the lines open between Dublin and Paris through the Brexit saga, difficult negotiations on corporation tax, ramping up interest for Ireland in French business circles and plans for new infrastructure connecting the two countries. 

“We felt that the double Irish scheme was not fair, and we were pleased that finally Ireland has decided to do away with it,” he says. But he warns that if broader agreement on the taxation of multinationals is not found between OECD countries as planned this year, France will resume its assault on Ireland’s tax regime at EU level.

The thorny tax issue aside, the ambassador paints a picture of increasingly close economic ties, with 150 new French companies seeking assistance to start doing business with Ireland last year alone, funding secured for a direct electricity interconnector and plans for increased ferry and port capacity in case of Brexit trade barriers.

Crouzat speaks about these complex issues in a clear, assured manner, and during the course of this interview only one topic causes him to show hesitation as his face darkens – an intellectual property dispute in which the embassy has been assisting a French company.  “We realised how complicated and costly the Irish legal universe can be, with unbelievable legal fees,” he says.

To keep his finger on the pulse of issues affecting his country’s business in Ireland, the ambassador harnesses networks tapping into the estimated 30,000 to 40,000 French nationals living here. Some of these could offer ideas to Ireland in how to better leverage its diaspora.

I meet Crouzat in his office overlooking Merrion Square in mid-January as the dust settles on new governments in the UK and the EU, while Ireland has just called an election. The walls are decorated with sheets of experimental French music, the official portrait of President Emmanuel Macron and an antique print of Wolfe Tone. He took up his first ambassador’s role here in June 2017 following a stint in Warsaw, having previously worked at the UN in New York and on climate change and European affairs in Paris. Ambassador postings typically last around three years.

My first question relates to the more immediate Irish news agenda.

Thomas Hubert (TH): How does an ambassador follow the election in the country where he’s posted and, in the case of Ireland, any particular areas that Paris is interested in hearing from you about during this election?

Stéphane Crouzat (SC): It’s always very exciting for diplomats posted abroad to be following an election, particularly a general election. I was lucky to follow the European elections and then before that, there was the referendum on the Eighth Amendment and there was also the election of the president. But a general election is really something special. And what Paris wants to know is, of course, the stakes for the country, but also for France and for Europe in particular. And I’m sure our capital will be particularly interested to see what the differences or the convergences are between parties as regards European affairs on the multiannual framework [the EU’s budget for the next seven years], on defence issues, on migration and all the really important issues – on climate of course, where we know that Ireland has made great strides in tackling climate action. 

TH: You’ve mentioned climate, that’s an issue that you followed previously in Paris. How do you see the progress so far? Ireland is going to miss its 2020 EU targets. And as the country that pushed the Paris Agreement, as you just said, you probably want to see things happening. So how do you lobby for this? How do you intervene when you’re here in Ireland representing France?

SC: Climate action is a hugely important issue for our country. We feel that we are the custodians of the Paris Agreement, and we make sure that it’s on the top of our own priorities. And for instance, last year, we did an important event with Trinity College to discuss the way forward on climate action. Former President Mary Robinson was there and intervened and we have lots of different civil society people joining to suggest ways of dealing as citizens on how to tackle climate change. 

We’re very pleased to see that Ireland has finally decided to really tackle the issue with the ambitious Climate Action Plan. Yesterday was the visit by [European Commission President] Ursula Van Der Leyen and I was pleased to hear how the Taoiseach was saying that Ireland would support the Green Deal of the Commission, and a very ambitious plan by the European Union to try and achieve carbon neutrality by 2050. That’s a target that we set for ourselves, the French government, and it’s also now a target that Ireland has set for itself. 

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The discussion moves on to corporate taxation. Days after this interview took place, French Finance Minister Bruno Le Maire met his US counterpart at the World Economic Forum in Davos and agreed to postpone until next December the collection of a unilateral tax imposed by France on the revenues of large digital companies. 

The US has been threatening increased tariffs ever since on the old French reliables – luxury products, food and wine. Both sides have paused mutual strikes, but the legislation underpinning the French tax and the US tariff list remain ready for action. The view articulated by Crouzat below remains Paris’s position.

TH: France has been very vocal against some of the policies used in Ireland. So what is the current position of France on the 12.5 per cent rate, on the tax base – on various issues that are raised at European level? What does France want to achieve on this? What does it expect from Ireland?

SC: We were very vocal because we felt there needed to be a level playing field in the taxation area within Europe. We felt that the double Irish scheme was not fair, and we were pleased that finally Ireland has decided to do away with it and it will be completely scrapped by the end of this year. We wanted to push the taxation issue within the European Union. Ireland was not on the same page, insisting that it should be dealt with at the OECD level. And we said well, okay, fine. Let’s go ahead at OECD. Now we have a very important discussion going on within that organisation to try and have a level playing field at the international level on how to tax fairly big companies and particularly big digital companies.

Since it proved difficult within the EU, we decided to go ahead at the national level and take on board some of the Commission’s proposal to tax companies on revenue. So on big companies that have €750 million revenue internationally and €50 million at national level: a three per cent blanket tax. What we said is, we would scrap that law, which is set at national level, once the OECD decides on the general regulation on this taxation. We hope that this year we’ll come to a conclusion. 

In fact, when you mentioned the 12.5 per cent, it’s exactly the figure that our Minister of Finance Bruno Le Maire has proposed at the OECD as part of the second pillar discussions, dealing with the level of taxation that should be set. He suggested precisely that level of 12.5 per cent. So we’re hopeful that things will move ahead quickly in that organisation. 

“If there is no solution at OECD level, I can assure you that this subject will come back at EU level.”

TH: A couple of points there we could develop a bit: You’ve mentioned the end of the double Irish, would you say France claims responsibility for obtaining the end of the double Irish from Ireland?

SC: It’s not one country claiming responsibility. I think it’s a joint general effort, the realisation on the part of many countries, including Ireland itself, in fact, that there needs to be a level playing field and fair taxation of companies, in particular big international digital companies.

TH: Then on the OECD BEPS process, when you’re saying there’s a good chance of reaching an agreement this year and having a level playing field around all those countries, what concretely are you doing about it from your perspective? Does that mean regular meetings, interventions from the French Embassy with the Irish authorities, or is it completely mutualised at OECD level? How much bilateral activity is there around that?

SC: Discussions are now ongoing at OECD level and the experts within the OECD do have their discussions, but of course, we are here as a bilateral embassy to relay the points of view of our government. That’s what we do all the time with our economic section, talking to politicians, to think-tanks, to opinion makers, to say that we really want things to change.

TH: And finally, the national digital tax that’s been in place in France for the past year or so – you’ve said it is temporary, it would go away when the OECD rules are in place. But at the same time, we had an interview with Pascal Saint-Amans, who is leading this process at the OECD. He was worried that multiple national initiatives like this would undermine the process and that we would end up with a very scattered approach to it. Do you understand this concern? Is there not a risk that a national initiative, even if it’s presented as temporary, would participate in that kind of breaking up of the rules and not a multilateral approach?

SC: I think the national initiative is there precisely to put pressure on everybody to reach consensus at international level. We don’t particularly want to have an national taxation solution. But we realise that if we don’t move forward somehow, things won’t move on. And that’s why we made it very clear that it’s not our ideal solution, but it’s the solution that we find constructive because we have said that hopefully if by 2020, OECD comes to a solution, we will scrap our own law, which works retroactively as of January 1, last year. And if there is no solution at OECD level, I can assure you that this subject will come back at EU level.

TH: On the 12.5 per cent rate, if I understood correctly, the French position is that once multinationals achieve an effective 12.5 per cent rate on their international sales in the OECD, you’d be happy with that and that would mean Ireland’s own rate would be level with the rest of the taxation on those profits? 

SC: Exactly.

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Crouzat arrived in Ireland one year after the Brexit referendum and has lived through the ups and downs leading to the withdrawal agreement finally adopted to allow the UK to formally exit the EU on Friday.

Although he insists that he had no play in the negotiations that officially took place strictly between Brussels and London, the ambassador acknowledges that Brexit had taken “a good part of our time”. “It took a lot of time bilaterally, because there was always the need to explain the French position and for us also to relay to capital what the Irish were doing and where their own interests lied,” he says.

TH: Have you found yourself advocating for Ireland in Paris and relaying the concerns about the border, about access to the British market – on those issues, you’ve sort of pushed the Irish interests in a way, even though you’re representing France, have you?

SC: A foreign ambassador doesn’t advocate for the [host] country, it advocates for its own country, always. But what an ambassador is expected to do is to make capital understand what the Irish position in effect is, not to say it’s the right position or the wrong position. That’s for authorities to decide. But at least to raise awareness of what the concerns of the country you’re in are. 

Of course, we would raise awareness about the invisible border, the need to keep that invisible border and why it was important economically for the preservation of the single market. That’s something that’s easily understandable back in Paris. But also the more diffuse and complicated issues that, politically, are raised because of this very crucial issue, and so that that’s where we, I think, had a lot of input.

TH: We’re now entering this very short period to achieve a final agreement, less than a year, which a lot of people say is impossible. Are you expecting or working on assumptions that this could have an impact on trade flows and relations between Ireland and France as a result of disruption on the British side of Ireland’s trade? And how do you see the connections with France evolving as a result of possible Brexit disruption between Ireland and the UK?

SC: It’s true that 11 months is a very short time to come up with an ambitious deal. We of course want the most ambitious deal with Britain. Britain is a key trading partner with France. Our first surplus with any country is with Britain: €12 billion every year is our trade surplus. So we have a vested interest in keeping excellent trading relationships with the UK. But what we will not compromise on is is the need for a level playing field and preserving the integrity of this single market, which is so precious for us. So we’re completely in line with the declarations made by the president of the Commission, by Michel Barnier, by Phil Hogan in that respect.

“There’s this keen interest in in the Irish market – understandably, after all Ireland is such a booming economy with so much potential.”

In terms of the impact on Franco Irish relations, hopefully they’ll be positive because France will become the closest neighbour within the EU. We already have a very healthy bilateral relation with €10 billion in trade, with many French companies having invested in Ireland in pharmaceuticals – I’m thinking of Sevier, Sanofi; in car equipment – Valeo. We have financial services companies – BNP Paribas, Société Générale;  insurance: we have Caci, we have AXA. Many, many companies are interested in Ireland and in fact, we were pleased to see that Business France, which is the equivalent to Enterprise Ireland, has had a very, very busy year. It has had some 150 French companies come and knock on their door to try and access the Irish market. So it’s really very healthy and it shows that there’s this keen interest in in the Irish market – understandably, after all Ireland is such a booming economy with so much potential.

In reverse, the relation that Ireland has with France is very, very encouraging with big Irish companies having invested in France: CRH, Smurfit Kappa; Primark has invested the French market since 2014 with huge success. So, there is also that dimension which is very important, but we can always do more. I think Brexit will probably open up new possibilities. We’re thinking of developing direct maritime links should Brexit be not as smooth and soft as we hope. If there’s friction, the landbridge that is being used by 80 per cent of Irish companies who export to the continent through the UK at the moment – should that be not as frictionless as it used to be, then there is potential for new maritime routes to be developed between France and Ireland. We’ve worked a lot with French ports, Irish ports, companies to try and see where we can beef up the links.

TH: What’s the response? Is there available capacity that can come on stream at French ports to welcome extra traffic? Would there be a smooth enough transition if transport had to move that way?

SC: Definitely. We have a lot of ports in France that are interested. Dunkirk is interested. Currently there’s no direct link with Ireland. Le Havre is very interested and there’s this reflection to have a new route between Le Havre and Rosslare, which would be very good. Already, we’ve seen that Dublin-Cherbourg was particularly reinforced with the introduction of the WB Yeats ferry, which is one of the biggest ferries in the world. All that is very encouraging, and I know that should there be Brexit by the January 1 next year that’s, again, not as frictionless as we hope, it will be probably easy for transporters to divert some of their current links and make these direct routes towards Ireland. People say: “Oh my gosh, it will take so much longer,” but when you think of it, from Dublin to Calais, it currently takes about 12 hours. A direct link from Dublin to Cherbourg is about 15 to 19 hours. So it’s a bit longer, but it might be offset by difficulties at customs.

TH: The companies you mentioned that are interested in looking at Ireland, potentially 150 new entrants who are at least looking at Ireland from France, what kind of sectors do they come from? What can you tell us about them? How different are they maybe from the ones that are already here?

SC: It’s a lot of SMEs that suddenly look at Ireland and say hey, here’s a market. A lot of it can be in agricultural equipment products, startup companies. We have companies, for instance, in packaging. So it’s extremely diverse.

TH: One section of the economy that’s been moving in preparation for Brexit is financial services. I know there’s been competition between, say, Paris and Dublin to attract companies that want to keep their EU passport. How do you see that evolving? Are you in your capacity as French investor in Dublin trying to lure them back to Paris if they come here? How did you deal with this kind of change of shape from the City?

SC: There was the ultimate competition between France and Ireland with the European Banking Authority. You remember how we drew lots and in the end, it was Paris that was chosen. So there we are. At that point, it’s luck that was in our favour. But what it did show is that both France and an Ireland, Paris and Dublin were very, very strong contenders for this European Banking Authority. It reflects in the number of companies that have decided to relocate both in Dublin and in Paris. 

Of course, here we are in competition. And it’s certainly not my job to lure companies to come to Dublin, on the contrary, I’m very happy when they go to Paris. But what’s nice is to see that there’s room for everybody, really. We’ve had, for instance, Bank of America relocating to Paris, but some of its divisions are going to be in Ireland. We’re happy to see that Citigroup also is locating to Paris, HSBC… Barclays is going to Dublin and a little bit to Paris. I think all in all we have, we have about 4,000 jobs being created due to these relocations in Paris and we’re hoping to reach the figure of 5,000, which is very significant.

TH: It nearly sounds to me like you have a table, Dublin v Paris, marking scores as you go along…

SC: Yes sometimes it’s nice to see where we both stand!

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The conversation turns to French people living in Ireland – a topic in which I have a vested interest. Crouzat says there are 11,000 nationals registered with his consulate here, but the number of French people in Ireland at any given time is around three times higher. “When I was in Cork at the Apple campus, which has about 6,000 employees, I was stunned to discover that 700 are French,” he said.

SC: You have lots of French people and in big multinational companies such as Google, LinkedIn, Facebook and so on. I would describe the typical French person in Ireland as sort of a young, upwardly mobile person who will want to have an experience in an Anglophone country in one of those multinational companies, and then perhaps move on after a few years. 

But that’s one description. The other description is people who have decided to come to Ireland for a few months or even for a few weeks and have suddenly discovered their life partner and have founded families. So we have a lot of those as well. 

TH: I fit the description myself…

SC: There we are! And then we also have an important contingency of students. Erasmus students love to go to Ireland. We have about 2,200 every year – the French students that go to Ireland through the Erasmus programme. We also have about 700 French students that elect to do their whole studies in Ireland. In fact, my own daughter decided to go to Trinity for four years and did her studies there, so she was one of those 700.

TH: And does that student population extend into research? Is there much cooperation between universities on research and development of technologies?

SC: Yes, a lot indeed. An important part of what we do at the embassy is to encourage links between French and Irish research centres. We have a scheme of seed money to encourage such research. It can be in any field – in fundamental science, in humanities and so on. We have several such projects funded by the French Ministry of Foreign Affairs and by the Irish Education Authority. 

The nice thing is that we’ve had new partners come on board. I was mentioning with the Celtic interconnector: Eirgrid and its French counterpart RTE have both decided to join that scheme. It’s called the Ulysses programme in honour of James Joyce and the book. They decided to join that scheme to fund bilateral projects in the field of renewable energy over the next five years. It’s very, very exciting.

“We have deputies and senators that represent these French abroad. They represent a considerable force that has to be reckoned with back home.”

TH: And there’s been a lot of talk in Ireland – I remember the Gathering a few years ago – in trying to leverage the Irish diaspora, which is huge around the world. Is there a similar approach from France with all these people living here and elsewhere? We know the French population of London is one of the biggest cities, even by French standards, hosting French people. How does France approach these people? Is there any attempt to organise them, leverage investment, influence or cultural projection out of them?

SC: We do have a lot of French people abroad, not quite as many as Irish people abroad. But roughly two million French citizens are abroad. The difference with Ireland is that these French citizens are entitled to vote in all the elections. I know it’s a consideration in Ireland to give the vote to Irish citizens for the presidential election. I think there’s a referendum going to be done to that effect. 

In France, it’s always been the case that the French have been able to participate in the voting and in the decisions of what goes on back home. We have deputies and senators that represent these French abroad. They represent a considerable force that has to be reckoned with back home. And that’s why we have many, many senators and deputies in charge of that region who regularly come and interact with this community.

Among the knowledge gathered through business networks, Crouzat mentioned problems that may hit French companies operating here. I ask him if he has examples of cases where he had to step in.

SC: Yes, sometimes we have difficulties with companies. I have one particular company in mind that has been engulfed in legal woes, felt that it was very hard done by and felt that its copyright, in fact, was infringed by an Irish company. It’s something that we’ve followed very closely and mentioned to the Irish authorities. 

It’s a very difficult one because it’s now in the judiciary system and we realised how complicated and costly the Irish legal universe can be, with unbelievable legal fees that this SME has to endure. So we’ve helped the company, this has gone for several months and years now.

TH: To finish, Ambassador Crouzat, any final thing before the end of your posting here – you’ve been here three years – that you hope to achieve, anything that would mark the end of your time in Ireland?

SC: This hasn’t finished yet!

TH: You have time left! So what would like to do before you go that would be closing off your period in Ireland?

SC: I think if we can set the seeds for a renewed relationship after Brexit that’s very, very dynamic, very thriving, I will be very glad about that. I hope I will have contributed to furthering these links now that Ireland and France are becoming so much closer because of Brexit. In the economic field, of course, but also culturally, we have a very exciting programme of events taking place in Galway as part of Galway Capital of Culture 2020. We’ve partnered with that organisation to present some French companies. Both on the economic side, but also educationally and developing the Francophonie and culturally, it’s a very broad and fun way of spending three years.