How Vienna Is Bidding to Become the New Home of the European Banking Authority

Following the Brexit vote, two EU agencies are poised to leave London. Amidst cutthroat competition, Vienna is a prime contender

As the Brexit negotiations drag on, the downside for Britain only becomes clearer. Now, two London-based agencies – the European Medicines Agency (EMA) and European Banking Authority (EBA) – are pulling up stakes. For European cities, the race is on. The EU has 37 agencies around the continent, each with a specific brief. But all bring well-paid staff, expertise and, often, an entourage of suppliers and a liates. So every country wants a share. This time, in the spirit of transparency, the EU Commission has set up a four-step process. The General Affairs Council, comprising the European or foreign ministers of the remaining 27 member states will convene on 20 November. In up to three voting rounds, they will decide the agencies’ new homes. The magic number needed is 14 supportive member states.

Drugs & Debits

So far, eight offers have been handed in to host the EBA. For the EMA, the bigger prize, 19 have been submitted. With over 900 skilled staffers, the EMA evaluates medicinal products for use in the EU, currently the source of about one-third of the new drugs brought onto the world market each year.

The Banking Authority, established 2011, is a relatively new body and with 180 employees considerably smaller than the EMA. The cluster effect, too, is not expected to be as signifcant, as most banks fleeing London are believed to favor Frankfurt, Paris or Amsterdam. Yet this is also the reason why the assessment of the EU Commission may count for more than with the far larger EMA.

Vienna has made offers for both agencies. The Vienna Business Agency (Wirtschafts- agentur Wien) has set up a webpage, complete with a video and the hashtag #emazingvienna. And even the elections play a role, with the Italian newspaper La Stampa speculating that the EU might be tempted to choose Vienna as an incentive for the new Austrian government to remain firmly anchored in the Union.

Bidding for the EBA

Yet given the competition, Vienna’s chances of hosting the EBA also seem strong. The two German applicants, Frankfurt and Bonn, scored badly with the agency’s staff , according to the German business weekly Handelsblatt. The chances of Brussels and Luxembourg seem slim as well, as both have more than their share of EU institutions. Paris too seems unlikely, as long as the European Parliament stays in Strasbourg. Then there are Prague and Warsaw, good candidates for more geographic diversification. Yet given that neither Czechia nor Poland is yet in the eurozone, basing the Union’s Banking Authority there would seem odd. That leaves Dublin… and Vienna.

“The key point for the EBA is continuity,” says Franca Rosa Congiu, spokeswoman for the agency. “The retention of staff is fundamental, and that is strongly influenced by access to international schools, job opportunities for partners and good transport links.” All points where Vienna scores high. And then there’s the building. In its bid, the Austrian government offered 4,300 m2 of newly built office space at Linke Wienzeile 216, in the 15th district, customized to meet the needs of the EBA and offered rent-free for 25 years – a compelling offer for cash- strapped European governments.

But the location itself is simply a strong card. “Vienna could be a strong enabler for the EBA to further strengthen its important neutral coordinating role between euro area and non-euro area member states,” says the Austrian Finance Ministry. The offer also made concrete references to the Vienna Initiative, which successfully stabilized the region’s banking system following the nan- cial crisis (see pp 18-25 “Family Matters”). Austrian banks themselves maintain a low profile, but seem sympathetic. “We would welcome the EBA in a solid and highly competitive banking market in Vienna,” said Carmen Staicu, spokesperson for the Erste Bank group.

The EBA would contribute approximately €40 million to the regional economy, according to the Institute for Higher Studies, and create more than 400 jobs, not including possible relocations of other financial service providers. Thus, the stars seem to be aligning for Vienna.

But the final decision on November 20 will still be, in the end, a political one. The city made a strong bid, now it’s up to Austria’s statesmen and diplomats to close the deal.

Benjamin Wolf
Benjamin Wolf
Benjamin studied Journalism, History and International Affairs. After stints with Cafébabel in Paris and Arte in Strasbourg, he is now working as managing editor and COO for Metropole in Vienna. Fields of expertise are politics, economics, culture, and history. Photo: Visual Hub

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