Vedder Thinking | News Sam Tyfield Discusses ESMA’s Rejection of “Letterbox Entities” in Financial Times Article
July 14, 2017
Sam Tyfield, a Partner in Vedder Price’s London office and a member of the firm’s Finance & Transactions and Investment Services groups, was recently quoted in the Financial Times article, “EU Regulator Rejects ‘Letterbox’ Relocations After Brexit.” The article discusses how, after Brexit, London-based investment and trading firms will need to set up executive and legitimate operations when they relocate activities to the European Union. The European Securities and Markets Authority (ESMA) hopes that forcing UK-based investment and trading firms to set up legitimate operations (for example, having offices function like semi-independent companies) will help prevent the existence of “letterbox” entities, which allow companies to essentially set up a postal address in another country in order to take advantage of the other country’s more lenient rules.
Mr. Tyfield comments on how this opinion is confirming many London-based trading firms’ fears—that these companies will in fact have to set up businesses in the EU. “It will be a case of ‘the irresistible force of staffing and operating a firm meeting the immovable object of political imperative’,” Mr. Tyfield stated.
To read more of Mr. Tyfield’s commentary, as well as the article in its entirety, please click here (login credentials may be required).