Muji could move European headquarters out of UK after Brexit

REUTERS/Stringer

• Japanese retailer Muji is reportedly planning to shift
  its European headquarters out of the UK because of
  Brexit.
• Bloomberg reports that it may move to Germany.
• The possibility of Muji’s move has emerged less than a
  week after electronics giant Panasonic confirmed it will shift
  its European HQ from the town of Bracknell to the Dutch
  capital, Amsterdam.
• Japanese companies are worried about how possible
  Brexit-induced tax changes could impact their
  profitability.

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The Japanese retailer Muji is reportedly ready to move its
European headquarters out of the UK in preparation for Brexit,
becoming the latest in a line of companies from the world’s
third-largest economy in ditching Britain as it prepares to leave
the EU.

According to a report from Bloomberg on Tuesday morning,
which cites people familiar with the firm’s ambitions, Muji is
preparing plans to move its European base to Germany as a result
of Brexit, which many Japanese companies believe could have a
serious impact on their ability to make money in Europe.

“As a company we’re reviewing the risks from Brexit and
always considering all available options,” a spokeswoman for Muji
told Bloomberg.

“We have not made a decision on moving our office since no
new location has been decided on.”

Muji operates 12 stores in the UK, and employs around 50
staff in its London HQ.

The possibility of Muji’s move has emerged less than a week after
Japanese electronics giant Panasonic confirmed it will shift its
European HQ from the town of Bracknell to the Dutch
capital, Amsterdam.

Japanese firms fear that Brexit could lead to changes in
the way the UK taxes corporations, which could in turn lead to
higher taxes back in Japan.

Effectively, if the UK lowers its corporate tax further after
Brexit, as it has suggested could happen, it could be considered
by the Japanese government to be a tax haven.

If that were the case, it could lead to Japanese companies facing
back taxes from central government, aimed at discouraging
Japanese organisations from having offices in tax havens.

Talk of Muji leaving the UK move comes just
over a week after the head of Japan’s biggest business lobbyist
said that Japanese businesses are “seriously
concerned” about their future in the UK if
Brexit uncertainty is not addressed imminently.

“We just can’t do anything,” Hiroaki Nakanishi, chairman of
Keidanren, the Japanese business
federation, said
in an interview with the Financial Times published on
Tuesday. “Everyone is seriously concerned.” 

Nakanishi told the FT that Japanese businesses operating in the
EU are frustrated — like many UK businesses — by the lack of any
real clarity over what sort of Brexit the UK will actually
achieve when the Article 50 period runs out in March next
year.

“Various scenarios get discussed, from no Brexit to plunging into
Brexit without any kind of deal at all,” Nakanishi added. “We’re
now in a situation where we have to consider what to do in all of
them.” 

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