(adds quote from Commission spokeswoman)
BRUSSELS, March 30 Luxembourg has formally
joined the fray over the future seat of the European Union
banking agency which will have to relocate from London after the
Brexit vote, claiming that it has a legal right to host the
The European Banking Authority (EBA) and its 159 London
employees are expected to move quickly from the Canary Wharf
financial district after Britain voted to quit the bloc, but the
new seat for the agency that coordinates EU banking rules is
The European Commission has suggested last week that one
option could be to move the body to Frankfurt and merge it with
the EU agency that oversees insurers and pension funds, the
European Insurance and Occupational Pensions Authority (EIOPA),
which is already based in the German financial capital
The suggestion has stirred criticism in Paris, which is also
keen to host the agency, and in other EU cities which long for
the jobs and prestige associated with hosting the EBA.
Luxembourg, which has long been seen as a potential host,
has now raised its stakes by claiming that it has a legal right
to be the EBA's seat.
The Grand Duchy's Prime Minister Xavier Bettel sent a letter
on Wednesday night to EU leaders to formally advance
"With this (letter), we have requests from 27 member states
to host the EBA," a spokeswoman for the EU Commission said,
adding that similar requests were made by all EU states also for
the European Medicines Agency, the other EU body based in London
and forced to relocate because of Brexit.
Luxembourg is a prominent financial centre, relatively close
to the EU's Brussels headquarters, and already hosts other EU
banking institutions, including the euro zone's bailout fund and
the European Investment Bank, Bettel said in the letter, of
which some excerpts were circulated to the media.
A spokeswoman for the Grand Duchy added that the letter is
more than a simple candidacy, as the country "has a legal claim
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".
The spokeswoman said that the decisions to establish the
European Central Bank in Frankfurt and the EBA in London were
taken in agreement with Luxembourg and as an exception to its
role, formalised in 1965, as one of the EU's seats.
"This time, we want the 1965 decision to be respected and
therefore claim that the EBA's new host should be Luxembourg,"
the spokeswoman said.
The European Parliament has urged to decide quickly on the
EBA's new seat and the Commission said it will make a proposal
during the two-year Brexit talks, officially launched on
Wednesday. The final decision will be made by EU states.
(Reporting by Francesco Guarascio Editing by Jeremy Gaunt)