Sorry for the lack of posts recently. I’ve been on holiday and then having to do my day job for a while.
Barclays has just announced that its proposed deal with ABN Amro will see the company’s headquarters move to Amsterdam. Despite being the dominant partner in the merger, the company’s chief executive and other senior managers will relocate to the Netherlands.
This strikes me as odd. Most foreign banks buy UK companies so that they can get into the City of London, with its skilled workforce and international trading environment. Why would a British bank buy a Dutch one then move all its senior people out of London? Perhaps this is just part of the horse-trading that usually goes on around mergers. The relocation to Amsterdam could just be a way of enabling ABN Amro to save face.
Whatever the reason, dragging bankers away from the City might not be a popular move. Barclays could lose some key people in the process.
A much simpler one – the Netherlands could enable it to have a much lower tax bill than it’ll have in the UK. The nominal headquarters are likely to be in the Netherlands, most of the folk will stay in the UK. There’s a good reason so many firms and trusts are headquartered in NL.
I’d guess that it’ll effect a handfull of folk anyway, and even then it’s perfectly easy to commute between the two cities, especially given how close both ‘headquarters’ are to an airport.
Andrew, are corporation taxes that much lower in the Netherlands?
One of the reports I read said that ‘investment bankers’ would be moved to Amsterdam. That doesn’t sound right to me. You are probably right, a few corporate head-office boffins will move and everyone else will stay in london.
I’ve not read it all, and of course I’m an HR bloke not a tax specialist, but you might find some useful information in this report: http://www.somo.nl/html/paginas/pdf/netherlands_tax_haven_2006_NL.pdf
If there is any trend going on in my industry it’s London becoming a stronger and stronger location. I don’t see much movement in folk, especially in IB where Barclays are much the stronger in most areas.