This was wonderfully logical but economically nonsense. If you lay out capital expenditure to acquire an asset which after five years is worthless, but you generate enough sales from using the asset over the five years to recover its costs, a judge, but never an economist or an accountant, would tell you that that asset did not represent a real cost to you, which had to be taken into account in determining if you had any income. That however is what tax law says. This was a reasonable fudge of a solution to a narrow judicial decision in an age when most long term expenditure was on tangible items such as buildings and plant. That age is long dead.
Information is power.
Information and knowledge are what drives corporate earning in many of the companies looking at Ireland as an investment location. The countries from which they come will demand that an Irish start-up operation pays for that existing knowledge before it is exported to Ireland. This is their way of protecting their tax base. So typically, a new Irish operation of a multinational will have to pay its American parent for accumulated know-how and technology which is transferred to it, and will arrange that future developments of technology be made available to it on a cost sharing basis. Payments on an annual basis for cost sharing of future developments are deductible in Ireland.