Email of the day on Bremain
Comment of the Day

June 17 2016

Commentary by Eoin Treacy

Email of the day on Bremain

I guess no one has the will to talk about Brexit after yesterday's tragic events, hence I am assuming you will not publish this email. 

For your benefit only then, I thought it may be useful to give a tangible example of what abandoning the EU may mean for London. 

As you know the business I work for is an investment manager, relatively small in size (manages around EUR 200mil). We are now - and in fact I have spent some of this week time at work doing this - planning to relocate. 

The reason for this is that there is uncertainty about whether we will be able to operate for EU clients was England to decide to leave (i.e. If passporting will be possible). This uncertainty will continue for months, if not years, were Brexit to win.

Bear in mind this company - along with many others - was set up in the UK for the sole reason that its Swiss shareholders would not be able to operate in EU from Switzerland; despite the confederation efforts to comply to EU regulations, passporting is not possible for Swiss companies. You can clearly see then how a Brexit will mean London will lose its role of preferred city to operate into the EU. 

Multiply this for all non EU companies wanting to access the EU market (one of the world's largest even without the UK), and you'll see things may look grim very quickly. Unnecessarily, given the already low commitment and favourable terms with which the UK is part of the EU. Just imagine how many vacuum cleaners Mr Dyson would have to sell to replace all the business lost in this way! 
Where to relocate? There is of course plenty of choice, from Paris to Dublin, from Milan to Malta. Everybody will be eager to get hold of this business, thank you very much, offering lower costs and above all more stable and better government. 

At this point I think only a strong victory of Bremain and definitive capitulation of the Brexiteers (i.e. their disappearance from the UK political scene) can give confidence back to non EU operators to invest in London.

Eoin Treacy's view

Thank you for a reasoned email raising important points for the City of London. This helps to explain why many politicians have been campaigning so vehemently to stay inside the EU, since the City is a major source of tax revenues and the UK needs to do whatever it can to protect it. I too am appalled by the murder of Jo Cox but the questions at stake are important so I did not hesitate to publish your valuable perspective. 

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