RiskBrexitLuxembourg wants to host EU banking body post-Brexit

Luxembourg wants to host EU banking body post-Brexit

The Grand Duchy has claimed the legal right to host the London-based European Banking Authority after the UK exits the European Union.

Luxembourg has put in an early bid to be come the new host of the London-based European Banking Authority (EBA) – the body best known for conducting regular stress tests of the European Union’s (EU) financial sector – following the UK’s decision to leave the EU.

The Grand Duchy said that it was asserting its legal right to host the EBA. “This claim is rooted in a decision taken by European leaders in 1965 in which they said they were willing to locate in Luxembourg EU bodies concerned with finance,” wrote Luxembourg’s prime minister Xavier Bettel, in a letter to EU Council president Donald Tusk and European Commission (EC) president Jean-Claude Juncker.

Bettel added that the claim “is nothing more than the implementation of this agreement, which is still valid today.” Luxembourg already hosts the European Investment Bank (EIB) and the eurozone’s bailout fund.

The EBA’s office is currently in London’s Canary Wharf financial district and has a staff of 170 employees. The EU executive suggested last week that one option could be to move the body to Germany’s chief financial city of Frankfurt and merge it with the European Insurance and Occupational Pensions Authority (EIOPA).

However, now that the UK has formally triggered Article 50 to commence a two-year period of Brexit negotiations, other EU cities are likely to compete and stake their claim to host the EBA. Reports suggest that Amsterdam, Dublin, Paris and Vienna are also in the running.

A spokesman for Ireland’s Department of Finance commented: “As an English speaking and well-established financial services centre, we believe that Dublin offers the least disruptive option for EBA relocation.

“To date, Ireland’s bid has been well received. The ultimate decision on relocation will be a matter for the European Council.”

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