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March 13, 2008

Yahoo Relocating European HQ From UK To Switzerland

Duncan Riley

21 comments »

yahoo-uk-ireland.jpgYahoo has announced that it will relocate its European head office from the United Kingdom to Switzerland. Yahoo plans to make the move to the shores of Lake Geneva within 18 months.

According to AP, Swiss media reported that Yahoo will benefit from a special tax break by moving to Switzerland.

The total number of employee’s affected by the move was not clear (5% is a figure quoted) with other reports saying that 70 employees in management roles will be told to relocate or lose their jobs.

Yahoo follows companies including EA and Cisco Systems that have relocated European Operations to Switzerland in recent times. The move would indicate business as usual for Yahoo despite Microsoft’s hostile takeover bid and rumored negotiations with other possible merger or acquisition partners.

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This entry was posted on Thursday, March 13th, 2008 at 4:12 pm and is filed under Company & Product Profiles. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

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  1. Google European Operations Moving to Zurich |

    March 25th, 2008 at 1:06 pm

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  1. Steen

    March 13th, 2008 at 4:41 pm

    Hopefully the tax brakes are significant enough to offset the high cost of labor in Switzerland.

  2. Paul

    March 13th, 2008 at 4:42 pm

    Happy trail’s, and hope they like chocolate’s

  3. Jay

    March 13th, 2008 at 4:47 pm

    5% seems like a very low number, unless it refers to Yahoo’s total work force.

  4. Otis Gospodnetic

    March 13th, 2008 at 5:58 pm

    Isn’t there a town called Zug (or something close to that) in Switzerland that’s a tax-free ehaven for companies? Is there where Y! is relocating?

    Oh, yeah, here: http://en.wikipedia.org/wiki/Zug (found via Google, ironically)

  5. Mike

    March 13th, 2008 at 6:32 pm

    Interesting this news breaks just as Google show off their shiny new offices in Switzerland

  6. Miracle Blade

    March 13th, 2008 at 8:51 pm

    I don’t think Yahoo! is too keen to sell up.

  7. iServiceshop

    March 13th, 2008 at 9:01 pm

    We agree with Steen’s take;
    Nobody ever lost any money moving to the globe’s favorite tax haven.. ;-)

    The Team
    http://iserviceshop.blogspot.com

  8. inkjetoffice

    March 13th, 2008 at 9:16 pm

    Why UK? Why Switzerland? It’s a global economic now. Yahoo should just build a HQ up in the space. Otherwise, it’ll another step late once Google has its HQ up there.

    http://blog.inkjetoffice.com
    http://www.inkjetoffice.com

  9. http://www.jeqq.com

    March 13th, 2008 at 11:21 pm

    yahoo should be every were

  10. http://www.fantasysportsmatrix.com

    March 13th, 2008 at 11:43 pm

    yahoo is scrambling..

  11. n

    March 14th, 2008 at 12:36 am

    Interesting move. Google already has a large office in Switzerland (Zurich), so I guess this will increase the ‘war for talent’.

  12. Martin Owen

    March 14th, 2008 at 1:32 am

    “In Italy, for thirty years under the Borgias, they had warfare, terror, murder, bloodshed — they produced Michelangelo, Leonardo da Vinci and the Renaissance. In Switzerland, they had brotherly love, they had five hundred years of democracy and peace, and what did that produce? The cuckoo clock.”

    The Third Man
    Orson Wells via Graham Green

  13. Andy

    March 14th, 2008 at 6:58 am

    Switzerland is a strange old place for tax. Yahoo! may have great deal for corporation tax with the Geneva authorities, but I’m afraid to say Yahoo! employees won’t have it so good. Income tax is different depending on which kanton (county or state) and gemeinde (regions within the kanton) you live in and Geneva isn’t one of the best rates you can get in Switzerland due to 30% of the city not paying any tax because they work for the UN or Cern. The city needs an income through income tax so the authorities make up the short fall by raising taxes for the rest of the citizens in Geneva.

    You can get your tax down to about 10% Kantons Zug and Schwyz, Geneva would be nearer 20% for the kind of salaries Yahoo! employees are on (providing the salary is healthy). :-) But this is where the world seems to be misled with Switzerland because on top of income tax, you have to pay health insurance, social insurance, 1st and 2nd pillar pension contributions and sickness insurance (maybe one of these is an employer contribution only, I can’t remember - but by the same token, I might have missed one too!).

    So depending on where you live in Switzerland, “tax” (which includes all contributions above) can be very high, or very low. The main tax advantage over here is that not paying taxes is not a federal offense, ie., you can’t be put in jail for tax evasion, or late payment, or “misunderstandings” etc. At the end of the day, you still have to pay.

    Andy (been stung by tax in Switzerland a couple of times)

  14. FredTheSwiss

    March 14th, 2008 at 8:05 am

    @otis: Zug is *not* Tax free. (We all whish)

    @many_commenters: Yahoo is going to “Vaud” (a State) which is next to Geneva (The State not the City). Taxes are lower.

    Why did they go there:
    - Taxes. But Ireland is better than Switzerland. So it is not the only reason.
    - Swiss currency is really low for US compared to euros or pounds which will make the project cheaper!
    - Employees can find a cheaper house compared as around London.
    - Security.
    - Quality of life.
    - Google, IBM R&D are not far.
    - International top rated univercities around.
    - There is an international airport close to the place and it is not as much on strike, delay, overload, etc. as the ones around London.

    BTW: Lake Geneva does not exist. It has been invented by the Tourism office. Its real name is: Leman Lake.

  15. Andy

    March 14th, 2008 at 9:48 am

    This must be a direct response to the British government raising corporation from 10% to 18%. Didn’t take long for the British government to drive their first big company out of the UK! No?

    andy

  16. Joe

    March 14th, 2008 at 11:52 am

    Switzerland offers not only tax breaks for corporations but also the highest quality of life, which helps attract top employees - as well as a good share of major global sports and entertainment celebrities… for whom the personal tax level is lower than in any of the EU countries. Google already has its HQ in Zurich and IBM has for decades had its global R&D center outside Zurich, also the location of the HQ of Dow Chemical since the ’60s by the way.

  17. Andrew J Scott

    March 17th, 2008 at 4:29 am

    This is a significant loss to the UK and London as a center for tech. So many things seem to confirm our decision to shift our HQ to the Bay Area in the U.S.

  18. steve

    March 17th, 2008 at 10:23 am

    Dear all,

    it is not all about tax, but maybe Yahoo! did the not so good move as Switzerland is well in the EU but not using the Euro as currency nor seen as a European country.

    Whereas Luxembourg is as well as neutral place to grow your European business but with the full EU advantages coupled with a neutral image.

    Best,

  19. Andy

    March 18th, 2008 at 3:30 am

    I would think this move is definitely due to tax changes in the UK.

    Corporation tax is attractive in Switzerland but Switzerland is not part of the EU.

    I wouldn’t say Switzerland has an abundance of technical talent though, certainly not a high liquidity.

    Andy

  20. Patrik

    April 6th, 2008 at 2:41 pm

    What if Yahoo moved to Switzerland not only for tax reasons, but also because of the secure and steady electricity flow and low energy prices? I heard people speculating that this might have been a reason too as yahoo is building a new datacenter in .ch. for this they bought a piece of land equal to 600 x 600 meters it was reported last fall: http://snurl.com/yahooland (in german).

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