I’ll run through three practice areas which could be involved in a relocation:
- What’s the length of the current lease? What are the termination provisions? Check contracts to consider the termination process and any provisions for early termination – can they agree/exercise a break option/sublet or even assign?
- Will they be taking a new lease in Frankfurt – lawyers to negotiate appropriate cost and terms – consider parking, service charges, guarantees, repairs, deposit, requirements for landlord consent in potential changes, building hours, security, landlord and tenant responsibilities etc. German counsel may also need to consider any state-specific regulations/permits and insurance.
- Are the constructing/refurbishing an existing building? This may need regulatory approval/planning permission under German and/or EU law. What kind of building quality does an international bank need? Office space?
- How does it move all its infrastructure/assets across? Will third parties help with transportation? What about the environment? What about health and safety
- Are people being relocated? Do they want to be – could this lead to potential litigation risks? What do their service contracts say – any mobility clauses or notice provisions? Where are they going to stay – will the firm accommodate for that relocation through compensation? Will they be housed? How many will be affected? What about their families? Is the bank giving enough time for consultation? Transportation and amenities? Does this discriminate against some? What about if an employee doesn’t want to relocate – are they disadvantaged/could they bring a suit
- Will they be hiring new staff? What terms will that be in? Consider German/EU employment legislation.
- How is the bank financing a relocation? Do they need to restructure? Issue equity or debt? Do they have cash?
- What’s the budget? They may need to fund substantial amounts from insurance to infrastructure to marketing. Lawyers will negotiate the terms of these contracts.
- What are the tax consequences of a move?
- German tax counsel may need to opine and evaluate Frankfurt legislation.
It’s important to remember the general commercial issues too:
How does relocation affect the ability of a bank to serve products to its clients/customers? How about existing contracts and licences? Can it make use of the passporting regime from within Frankfurt – how? What about serving existing UK clients post-Brexit?