Paris is positioning itself as a business-friendly post-Brexit location, with changes in tax and labour laws aimed at wooing foreign companies.
Paris is among a handful of cities, along with Dublin, Frankfurt and Luxembourg, competing to become the financial capital of post-Brexit Europe. The stakes are getting higher. With Britain set to leave the European Union by the end of March 2019, hundreds of financial institutions face losing their financial “passporting rights”, which grant them access to the EU single market. This could force them to relocate thousands of London-based workers.
Paris is restyling itself into a more business-friendly city overall in hopes of an influx of companies relocating. Local politicians predict that 10,000 Brexit-related jobs will eventually move to Paris, and create another 10,000 indirect jobs. Whether this number can be attained is unknown, but some announcements by big banks suggest Paris is a contender. Earlier this year HSBC said it might move 1,000 employees from London to Paris. Bank of America, which in September announced plans to move 300 employees to Paris, this month said it is considering a bigger post-Brexit move to the French capital.
What companies tend to value most are business-friendly laws, regulations and culture. Despite a longstanding reputation to the contrary, France is proving eager to accommodate them. Among the institutional changes underway are new labour laws as well as legislation to slash a “wealth tax” believed to repel the rich. English-speaking judges and other officials are being installed. In February, a delegation of French leaders in politics and business met with over 80 executives in London. Executives have also been conferring with members of Parliament on drafting a wide-ranging law to improve the French business environment.
A cultural legacy credited to the French Revolution, real or imagined, has given the French an anti-business reputation – which new French leaders, especially President Emmanuel Macron, are striving to undo. From the day the Brexit vote results were announced, Macron has been encouraging Londoners to take their talents to Paris. Paris Region Entreprises, a consultancy focused on business development in the city, kicked into high gear. Its marketing push was matched by the efforts of government officials to attract foreign companies to Paris.
The French government also appointed former Bank of France Governor Christian Noyer to be the country’s “Brexit point man”. While Noyer does not place primary emphasis on the famous charms of Paris, such as its food, he does believe they give the city an edge in competing for talent. A company can send staff members to any city they want, Noyer told the New York Times in an interview. “But if they have a competitor who is going to a nicer place, the best staff might, if they are offered a job in a better city, leave after a few months.”
