Britain set to lose Formula E if Brexit deal can’t be reached
If Britain crashes out of the EU without a deal, the London-based Formula E electric car-racing series could leave Britain, according to Alejandro Agag, the organisation’s chief executive.
Despite previous seasons taking place in London, it was revealed in June that this would not be the case next year and the fourth season will instead be held in Hong Kong, starting on December 2 2017.
The organisation currently employs about 100 staff at its West London headquarters.
Despite being a London resident, Agag said that Formula E could be forced to move its business to the European Union in the event of a Brexit no-deal, a process that would take only a day if necessary.
“We have a lot of expats that work in the company - probably of our 100 employees, 50 are British and 50 are from other countries,” he said.
“A lot of our contracts come from the European Union in terms of sponsorship, so if there is not a deal in terms of tax and employment, we will leave.
“We probably would leave overnight. We could make a decision in one day and then leave. We’re looking at different options. Maybe Holland, maybe Monaco. Some nearby place in the European Union,” he added.
Agag said his strong preference would be to stay - not least because he had just bought a new house.
Withholding tax being imposed on sponsorship payments from EU-based partners once Britain leaves the EU in 2019 would force his hand.
“If there are withholding taxes on sponsorship payments, that would make our business impossible. So then we would have to leave. And of course if the people cannot stay here working then that would make us leave also,” he said.
“A sponsor from France, like Michelin for example, the fee they pay me will have a 30 percent withholding. So my revenue will go down by 30 percent.
“And if I move to France or Holland, I will get the whole fee. It’s a no-brainer.”
Meanwhile, UK Prime Minister Theresa May has said that the British tech sector has recently been attracting more investment than France and Germany, despite Brexit, which proves that the move isn’t the disaster that its detractors have claimed.
She said a “lot of people” had predicted “real problems” after the referendum vote last year, but the figures showed the strength of the sector.
Addressing tech bosses in Downing Street, May restated her desire for a “comprehensive and ambitious trade agreement” with the EU.
She added: “If you think back, a lot of people said they thought that we would see real problems being created after the referendum vote.”
Figures showed that £2.4bn had been invested by venture capital firms in the British tech industry since the referendum.
“That’s twice the amount of Germany and three times the amount of France,” she said.