Catalan firms tempted to relocate outside region

Small Catalan firms are moving their headquarters outside of the region or setting up parallel companies to skirt a boycott of goods from Catalonia by Spaniards angry over its separatist push. While tensions have eased somewhat since Spain’s central government last month took direct control of the northeast region and has scheduled regional elections in December, many businesses in Catalonia still feel the need to guard against uncertainty. The head of a small family-run wine and spirits business said he believes setting up a duplicate distribution firm for his goods in Madrid was the right move.

His company’s sales have plunged by over 30 per cent since Catalonia went ahead with a banned referendum on October 1 followed by the Catalan parliament unilaterally declaring independence.

The new distribution company allows him to slap his products — which continue to be made in Catalonia — with a Madrid address that he hopes will help sales recover.

“We won’t sell anymore if we don’t do this,” said the businessman, who did not want to be identified. “This is a decision you take when you have no other choice,” he said.

Over 2,700 companies have moved their headquarters outside of Catalonia since the referendum because of the uncertainty caused by the separatist drive and the boycott campaign, according to Spain’s commercial registrar’s office.

The moves are mainly administrative for now, but many fear the companies could eventually relocate staff and production outside of the region as well.

While the departure of listed multinationals, including Catalonia’s two big banks, Caixabank and Sabadell, have grabbed the media spotlight, the exodus also includes small and medium sized firms.

In an upscale Barcelona neighbourhood a small drug distribution company with just 12 employees has accelerated a move of its headquarters which had already been planned to Seville, the capital of the southwestern region of Andalusia.

The company says its sales in Andalusia, where it earns the bulk of its turnover, have dropped 10-20 per cent since the referendum.

“Patients say ‘ give me a product that is not Catalan’. This has never happened before,” the company’s director said.

The headquarters move also aims to ensure the company remains within the European Union’s legal framework if Catalonia were to become independent one day.

“We would go bankrupt because the medicines we import would be subject to customs duties,” the director said.