When Ireland announced last spring that it would sharply curtail a lucrative tax break for musicians, painters, writers and sculptors, the shift posed a financial threat to U2, which has made the Emerald Isle its financial power base for nearly three decades.
When Ireland announced last spring that it would sharply curtail a lucrative tax break for musicians, painters, writers and sculptors, the shift posed a financial threat to U2, which has made the Emerald Isle its financial power base for nearly three decades. The Dublin-born-and-bred rockers built their fortune on hit songs and, in part, on Irish laws that forgive taxes due on royalties.
As of last year, U2 had amassed a net worth of 629 million euros — around $908 million — according to the annual “Rich List” of top earners in The Sunday Times of Britain. Royalties are the income that artists and athletes earn from recordings, performances, trademarks, brands, patents, copyrights, film rights, product endorsements, videos, films and the ever-extending commercialization of those assets — in short, the major portion of an artist’s or an athlete’s income.
Last June, with the Irish tax break about to shrink, U2 heeded the advice of its longtime business manager, Paul McGuinness, and moved its most lucrative asset — a song-publishing catalog with hits like “Where the Streets Have No Name” and “It’s A Beautiful Day” — from Mr. McGuinness’s firm, located near the Liffey River in Dublin, to Promogroup, which operates beside the elegant Herengracht canal in the heart of elegant, old Amsterdam.
Promogroup’s headquarters are in a maroon-brick town house built four centuries ago for slave traders and spice merchants. Mr. Favie did not respond to repeated requests for an interview. To date, his company has not filed any information on funds flowing through U2 Ltd., the Dutch entity that holds U2’s song catalog.