(MENAFN- AFP) Major international banks are seriously exploring whether to shift operations from London to Paris in the wake of Brexit, according to a senior official at France's markets regulator.
"Large international banks... have already undertaken real due diligences and we have received a lot of practical questions regarding the way they are going to be managed from our perspective, with their relationship with the French regulators," Benoit de Juvigny, secretary general at the AMF, told BBC television late Wednesday.
He stressed however that the enquiries remained "informal" at this stage, as did similar steps being taken by consultants and lawyers.
Other financial centres said to be in the running include Amsterdam, Dublin, Frankfurt and Luxembourg.
Powerful lobby group the British Bankers' Association (BBA) has warned that international lenders with operations in the UK are ready to transfer some of their activities out of the country from early 2017, following Britain's shock EU exit referendum.
Big banks have publicly voiced their fears about the impact of Brexit, including potential loss of access to the European single market.
However, both the AMF and the BBA declined to comment further. The Treasury did not respond when approached for comment.
De Juvigny noted that while London possessed "great expertise" in the field, his own city's expertise should not be underestimated, adding he sees the prospect of regulating banks wishing to move across the Channel as "a welcome challenge".
"Also it is a dangerous challenge because we could see some kind of new competition between countries, between regulators."
- EU divorce looms -
Conservative Prime Minister Theresa May has stated that she will formally trigger the two-year EU divorce process by the end of March 2017.
However, Brussels and London face the daunting prospect of gruelling negotiations on future trade deals with the EU and countries outside of the bloc.
EU "passporting" rights currently allow financial products approved by a single regulator in a member state to be sold in the entire EU.
But firms registered in the UK risk losing this access when Britain leaves, which could push some companies to move at least some of their activities to continental Europe.
A so-called "hard Brexit", meanwhile, would see Britain's departure from the single market or tariff-free zone, while ending the free movement of people.
"Banks will assess whether London is still a suitable base on the grounds that a hard Brexit means financial services firms such as banks, asset managers and insurers would lose their ability to 'passport' their products into the EU," noted Russ Mould, investment director at stockbroker AJ Bell.
"This 'passport', first introduced in the early 1990s, has helped make London an ideal stepping point for global banks seeking access to the EU.
"Loss of passporting rights could limit access to the EU, persuading service providers they need a European base from which to operate, to stay competitive.
"This is why the debate between hard and soft Brexit is so important, with Prime Minister May emphasising a determination to keep access to Europe's markets, while the EU authorities in return are stressing Brexit means hard Brexit or no Brexit at all."
- 'Keep calm and negotiate' -
London remains eager to retain access to the single market, but Brussels has repeatedly it cannot expect this while limiting immigration by European citizens.
The bloc's chief Brexit negotiator Michel Barnier warned Tuesday that London must broker its departure deal by October 2018, adding that time was running out.
Barnier also urged Britain to "keep calm and negotiate", echoing the UK government's motivational World War II motto "keep calm and carry on".
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