France Sets Up One-Stop Shop for British Firms Fleeing Brexitby
Prime Minister Valls points to falling coporate tax rate
Safran’s McInnes named ambassador for post-Brexit Push
France created a one-stop shop to welcome businesses from Britain -- and the rest of the world -- who are looking to set up new European headquarters as the U.K. prepares to leave the European Union.
The initiative is the latest push by Britain’s neighbor, ally and historic rival to compete for jobs and investment in the wake of the U.K. referendum. French Prime Minister Manuel Valls, flanked Thursday by Paris region head Valerie Pecresse, Paris Mayor Anne Hidalgo and Safran SA Chairman Ross McInnes, sought to counter France’s reputation for high taxes and heavy regulation.
“France is changing,” Valls said at a press conference in the French capital, adding that the corporate tax rate will fall to the European average of 28 percent by 2020 and vaunting the payroll tax credits introduced under President Francois Hollande. “I’m convinced that we’re moving in the right direction,” he said.
Cities across Europe are eyeing the spoils of Brexit, making a pitch to businesses large and small that want to ensure they retain access to the single market after Britain’s departure. France’s one-stop shop is intended to provide businesses with a dedicated contact to help navigate the administrative hurdles involved in relocating.
“When a company is considering moving to Paris, they should have someone who they can talk to,” said McInnes, a native Australian and naturalized Frenchman who will be the ambassador for the program. “These are momentous decisions and not ones that will be made over night. Our idea is to work this through over the next few years.”
Valls repeated a promise made in July to extend France’s special tax regime for foreigners to eight years after their arrival from five currently. Speaking separately at the National Assembly, Bank of France Governor Francois Villeroy de Galhau emphasized that the fallout from Brexit will depend to a large extent on the kind of new relationship that Britain negotiates with the EU. Clearing of trades in euros will almost certainly have to remain within the European single market, he said.
“It’s difficult to imagine that euro clearing will be based outside the euro zone or the single market,” Villeroy de Galhau said.
Pecresse, who this week endorsed former Prime Minister Alain Juppe for France’s 2017 presidential race, said that she regrets the U.K.’s decision to leave the EU but emphasized that France cannot let jobs and investment flow elsewhere. The Paris regional government estimates that about 30,000 financial-sector positions are up for grabs with the U.K. departure from the EU, with approximately another 30,000 potential posts to be won from other British industries.
“Brexit is profoundly regrettable,” she said. “But we cannot be passive or naive.”
Weekend in Frankfurt?
With 12 million residents and easy rail access to London and Brussels, as well as western Germany, the Alps and the Mediterranean, there is no reason why the French capital can’t compete, Pecresse and other French officials say. For French authorities, Paris’s global size and stature themselves should be touted as advantages.
“When was the last time you booked a weekend in Frankfurt?” McInnes asked journalists after the press conference.