Corporate exodus forces Catalan government into rethink

A flurry of movement of major businesses out of Catalonia appears to have sown doubts within the region’s separatist government about plans to issue a declaration of independence in the next few days.

On Thursday, Sabadell bank announced it was moving its registered office from Barcelona to Alicante, on Spain’s east coast, as the government of Catalonia suggested that it planned to follow through on the results of the October 1st independence referendum and declare itself a sovereign state.

On Friday the board of another major Catalan lender, Caixabank, was reported as having decided to move its registered offices elsewhere, as was also the case with energy giant Gas Natural.

The moves do not imply transferral of staff or assets. However, they mean the companies will pay their taxes outside Catalonia.

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José Luis Bonet, chairman of Cava producer Freixenet, compounded fears of a corporate exodus when he said he would propose to his own firm's board a move elsewhere.

“If we really are heading for a unilateral declaration of independence, there will be a lot of companies leaving Catalonia, which will cause Catalonia serious damage,” said Mr Bonet, who is also chairman of Spain’s chamber of commerce.

Earlier in the week the Catalan parliament had scheduled a session for Monday, during which it was widely reported that it would approve an independence declaration. However, on Friday, as the reports of corporate concern mounted, Catalan president Carles Puigdemont revealed he would appear in the parliament on Tuesday "to report on the current political situation".

Santi Vila, business minister in the Catalan government, called for a “ceasefire” between the Catalan and Spanish governments and appealed to those who want the cause of independence to be patient.

“The referendum gives us an obligation, but we have to reflect on whether hurrying could ruin the dream,” he said.

‘Need for calm’

In last Sunday’s controversial vote, which the Spanish government deemed illegal, 90 per cent of participants supported independence, with turnout at 43 per cent, according to the final results published on Friday.

“We need to calm down, sign some kind of truce that allows us to move calmly, with moderation,” Mr Vila added, warning against taking “irreparable decisions in the coming days”.

Artur Mas, Mr Puigdemont's predecessor as Catalan president, told the Financial Times that the region is not yet ready for "real independence."

“To be independent there are still some things we don’t have,” he said.

Any caution or hesitation on the part of Mr Puigdemont and his advisers will come under scrutiny from many of his partners in the pro-independence movement, however.

Although a lifelong defender of Catalan independence himself, many in Puigdemont’s conservative Catalan Democratic Party are more recent converts to the cause and they govern with the more stridently secessionist Catalan Republican Left.

Propping up the government in the regional parliament is the Popular Unity Candidacy, a small, anti-capitalist force. This party, in particular, is known to be in favour of making the independence declaration as soon as possible, as a prelude to drawing up a constitution for the new republic.

Carles Riera, a regional deputy for the party, said that the declaration should be made on Tuesday. “It cannot be avoided or delayed,” he said.

Police head in court

Adding to the tension between Madrid and Catalonia on Friday, the head of the Catalan police force, Josep Lluís Trapero, appeared in the high court in Madrid on charges of sedition. Investigators say Mr Trapero disobeyed orders to prevent Sunday’s referendum from taking place, with his force doing little to shut down polling stations first thing in the morning, as commanded.

Later in the day, Spanish riot police moved in to several voting stations, where they used batons and rubber bullets to remove voters.

The Spanish government’s representative in Catalonia, Enric Millo, issued an apology for Sunday’s violence, in a rare concession by Madrid on the issue.

“When I find out that there are people who have been hit, I can only apologise,” he said. Previously, the central government had fully backed the behaviour of the national police and had even questioned Catalan government claims that about 900 people were injured by the police.

In response to an independence declaration, the government is believed to be considering triggering article 155 of the constitution, which would allow it to suspend the Catalan government’s powers.

As uncertainty continues regarding the Catalan government’s intentions, efforts are being made to introduce a credible mediator, despite Madrid’s insistence that it will not negotiate with the threat of an independence declaration hanging over it. Javier Maroto, of the governing Popular Party, said “you can’t talk to someone who is breaking the law”.

The government of Switzerland has been in touch with both parties with a view to mediating, although the country’s foreign ministry said on Friday that conditions for negotiation “are not in place”.

Contacts have also reportedly taken place between the Catholic Church and the two sides.