Nicolas Sarkozy “to move to London to set up €1bn private equity fund”

Former French President Nicolas Sarkozy could be planning to move to London with his wife Carla Bruni to set up a private equity fund and escape the threat of a top income tax rate of 75% in France, it was reported. If true, this would make the pair the highest profile Gallic celebrity couple in the City.

According to French investigative website Mediapart, the ex-president has been planning to set up a private equity fund with the aim of raising 1 billion euros for months. The venture would seemingly be run with the help of French entrepreneur and political adviser Alain Minc.

Details of the move were reportedly uncovered when fraud police raided Sarkozy’s Paris mansion last June, with the former president under investigation for corruption in France over the “Bettencourt affair” which unfolded under his leadership.

The affair centres around claims that Sarkozy took money from L’Oreal heiress Liliane Bettencourt. Sarkozy denies these claims but could still receive a prison sentence.

Detectives found a “first draft” of Sarkozy’s London project on examining his computer files, according to Mediapart. The police raid came weeks after Sarkozy’s election defeat last May, with him losing his presidential immunity against prosecution.

Mediapart claims that the London move would create a “conflict of interest”, firstly because Sarkozy is being investigated, but also because he would be an ex-French president choosing to base himself in the UK.

Sarkozy’s prospective move comes in the wake of a number of high profile departures. Luxury goods billionaire Bernard Arnault and actor Gerard Depardieu have suffered a firestorm of criticism for trying to escape France and the looming threats of Hollande’s tax regime.

A spokesman for Sarkozy played down the Mediapart reports, saying it was the result of “intellectual constructs”.

Sarkozy’s adviser and possible business partner Alain Minc rubbished reports of his involvement. He insists the ex-president hasn’t decided what he is going to do.

“Nicolas Sarkozy doesn’t need me to meet the world’s biggest investment funds,” he told Le Figaro.

Minc added: “[Sarkozy] has tons of contacts and hasn’t decided what he’s going to do. It’s absurd to imagine he might go and live in London and stop paying taxes in France.”

 

Readers' comments (1)

  • France, the US and many other countries with a progressive tax system have an inherently fragile revenue model. This fragility exists whether you think such a system is "fair" or "unfair" and is caused by the natural outcome that a very small number of people provide a very large portion of the total personal taxes collected. Generally, the top 1% contribute approximately a third of the total, while the top 0.1% contribute over 10% but is comprised of a minuscule number of individuals.

    Contrary to Occupy Wallstreet dogma, the 1% or even the 0.1% are hardly homogeneous regarding their value system or attitude toward taxation. Just remember that both Michael Moore and Bernard Arnault are in the 0.1% group. About the only common attribute (aside from their wealth) is that as a result of globalizing "flattening effects", they are no longer bound to the tax home of their birth in order to make or maintain their wealth. In short, they are no longer "sticky" and can leave easily and quickly.

    The danger for France, the US or any other country with a progressive tax system is that they only need a tiny number of the 1% or 0.1% to leave their tax regime to cause a catastrophic effect on their future tax revenue. An individual such as Depardieu, Mickelson, Saverin or even Arnault with not, by themselves, bring France or the US to its fiscal knees. However, such high profile opinion leaders may inspire other "Golden Geese" to leave. With such a fragile revenue model, an exodus of even a small number of Golden Geese could spell disaster.

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