Intel Ireland Ltd, the company which runs the huge Intel plant in Leixlip, Co Kildare, is a Cayman Islands company with a "branch operation" in this jurisdiction, documents in the Companies Office show.

An examination by The Irish Times of multinationals with operations here has established that many make use either of the Cayman Islands or the Netherlands. Atlantic Resources, the CocaCola subsidiary in Co Louth, is also a Cayman Islands company with a branch operation here. Intel is the largest multinational investor in this economy, having already invested $3 billion (#3.4 billion) and it plans to invest a further $2 billion.

As external companies operating here, they do not have to file accounts for their Irish operations in the Companies Office.

The rate of tax and the profits from different jurisdictions can be "mixed" in the Cayman company, before the profits are moved on to the multinational's headquarters. In this way the low Irish corporation tax rate can be used to "offset" the tax paid in jurisdictions where the rate is higher in order to minimise the tax due in the multinational's home country.

Irish corporation tax rates, currently 10 per cent for foreign manufacturing companies, compare with a rate of 35 per cent in the US, and 25 per cent in Germany. Dell, Microsoft and Pfizer have links with holding companies based in the Netherlands, where dividends from foreign subsidiaries are tax free and where holding companies can sell foreign shareholdings without incurring capital gains tax.

Globally, efforts to attract multinational investment are causing a decrease in corporation tax rates, according to the Organisation for Economic Cooperation and Development. This has implications for the financing of public services. Oxfam has said efforts by the developing world to compete have led to its reducing its rates, at an annual cost of $50 billion - the equivalent of the amount sent in aid to the developing world each year.