Several banks and other industries have announced they are moving out of the United Kingdom, causing a host of compliance headaches.

Japanese banks, Nomura and Daiwa Securities Group, are moving to Frankfurt. Another Japanese bank, MUFG, is planning to open a subsidiary in Amsterdam and said moving to Frankfurt is something that the bank might consider in the future.

“London remains MUFG’s EMEA headquarters, and there is no change in our commitment to the U.K. and EU markets,” MUFG said in a statement.  “We have been enhancing our core banking unit in Amsterdam for several years, and for this reason we have decided to establish a new subsidiary of MUFG Securities in the city to minimise uncertainty arising from the U.K.’s exit from the EU. This will involve transferring some functions of our securities business to Amsterdam.”

The company added, “We are working closely with regulators to ensure that we reach a solution that is in the best interests of our clients. This may involve establishing branches of the new subsidiary in other European cities [such as Paris].”

Many other companies are moving too: EasyJet is moving to Austria. Citigroup and Bank of America are moving to Dublin; Morgan Stanley and Standard Chartered, to Frankfurt. JP Morgan is moving to several EU offices: Frankfurt, Amsterdam, Dublin, maybe even Luxembourg. HSBC is off to Paris, Tiffanys is going to Amsterdam, and Fintech start-up Transferwise is going somewhere in mainland Europe and would never have had its IPO in London had Brexit been a real possibility.

London itself could lose upwards of 10,000 in banking jobs alone and a further 20,000 roles in accountancy, law, and consulting as a result of Brexit, states a recent report from Brussels-based think tank Bruegel. EU agencies based in London will also have to move.

Frankfurt is bidding to host the European Banking Authority, the EU agency created to supervise banks after the financial crisis, because it must leave its London headquarters after Brexit. Ironically, the British government had fought very hard for the agency and its 150 jobs to be based in London.

Overall, it is an employment disaster for Britain, though a boon for continental Europe, and a costly one; estimates are out there of costs per employee in excess of €250,000 to move to continental Europe from London.

But what compliance headaches is this going to cause?

Compliance officers will have to develop and implement new legal compliance programmes to comply with the national regulations for the new jurisdiction. They will have to educate and train new and/or transferred employees. They may need to adapt their employers existing internal controls to meet the demands of the new jurisdiction and may even have to revise company policies. They would need to reassess the level of compliance risk presented and potentially devise a new set of plans to manage a crisis or compliance violation.

The list of items that would have to be reviewed for the new jurisdiction is an extensive one that would include everything from employment law, to laws relating to leasing or purchasing a building, to cyber-security requirements, data sharing, and data privacy, customer due diligence, and so on.

For banks and other service industries, the reason for the move is that the United Kingdom is expected to lose ‘passporting rights’ after Brexit. This would be a major financial setback unless companies prepare for it by moving part of their main operations over to the continent.

The EU's passporting rules allow businesses to sell services across the EU from anywhere within it and only require companies to be regulated in one country, rather than everywhere they operate. Estimates for banks moving range in office size from 10 to 1,000 staff, but they are unlikely to move all of their operations overseas and will not only relocate staff from London, but also hire new staff in EU locations. Of course, many banks and other service industries already have offices in various capitals across the EU, so these existing locations can be expanded—though some, including JPMorgan in Dublin, are building new offices to house employees.

The steady drip feed of announcements follows the conclusion, typically, of negotiations with regulators in Britain and the country of destination, as well as with EU regulators for that particular industry such as the European Central Bank. There are also time restraints. Because of the time required to apply for and be granted banking licences, for example, banks need to have full plans in place this year. And the Bank of England has asked banks to provide it with their Brexit plans by 14 July this year, thus the spate of bank announcements in the weeks leading up to and following that date.

For other industries, the issues are different. For some, particularly high-tech industries like the gaming industry or FinTech, it will be the lack of access to talent that could result from the ending of the freedom of movement of labour from European countries into the U.K. that will cause the biggest economic headaches.

For others, it is, again, about regulations. EU officials have told some U.K. airlines—for example, easyJet and Ryanair—that if they want to continue enjoying the same freedoms across EU airspace that they enjoy currently, they will need to relocate at least some elements of their business into the EU or sell off shares to European national carriers thus retaining a European access route. After Brexit, it is by no means certain—though, of course, as with much else, this is up for negotiation—whether the U.K. will be part of existing aviation agreements that allow these airlines to operate on routes within continental Europe.

Over the coming weeks, I will be writing a series of cases studies on individual companies making these moves, looking at the compliance challenges and opportunites that are raised by such transnational transfers.