Phew! That was close. But in the end, it was enough. On Thursday evening, Frankfurt was awarded the EU Anti-Money Laundering Agency. The selection process was full of suspense until the last moment, probably even nerve-wracking for those involved. Twenty-eight votes were required, and Frankfurt managed to secure exactly that number.

Essentially, three hurdles had to be overcome: Firstly, the German government had to convince enough other governments. And not so much through marketing and rhetoric, but rather through the classic instruments of diplomacy: concessions elsewhere, commitments of support in neighbouring dossiers. Secondly, the Germans had to ensure that there was no opposition to Frankfurt in parliament. Positive signals emerged after the city made it onto the shortlist of EU parliamentarians. The third risk factor was the secret ballot. Despite all agreements and promises, in the end everyone involved was able to vote as they wished without being discovered. Ultimately, even now, after the vote, we do not know whether the 27 governments actually all voted in favour of Frankfurt and only one MEP. Or whether it was 15 national votes and 13 MEPs.

This brief summary proves that the awarding of the AMLA to Frankfurt was anything but straightforward. In particular, credit must be given to the German government, which – unlike in the competition for the seat of the EU Banking Authority – went all out this time.

However, despite all the joy at this success, nobody should lose sight of the fact that this is not about a sporting competition that Germany has now won. Rather, it is a promise to its EU partners to finally combat money laundering in Europe more effectively than has been the case to date, particularly in this country. Germany has set itself ambitious goals, including the establishment of a federal authority alongside the AMLA and the expansion of personnel capacities. This is urgently needed, because the most repugnant crimes are behind money laundering – and a financial centre that takes a half-hearted approach in the fight against money laundering is rightly open to harsh criticism. The award of the AMLA headquarters in Frankfurt is a leap of faith by the EU partners that Germany is really serious about its ambitious announcements, as made in the course of the presentations.

In return, the financial centre on the Main will benefit immensely from the establishment of the EU authority. Not so much because of the 400 jobs that will be created in the city. And not so much because of the prestige of having prevailed in the showdown in Brussels. But because proximity to supervisors and regulators is becoming increasingly important for banks, funds, and companies in times of tight regulation. Compliance, i.e. adherence to legal requirements, has long since become a supreme discipline in banks. And compliance has long been interactive. For example, by banks liaising with authorities, specialists with specialist officials, in constant and ideally personal contact about how certain legal terms and requirements are to be understood. Not by a supervisor subsequently assessing what a bank has done (wrongly) according to its own interpretation of the rules. This applies in particular to sensitive issues such as money laundering prevention. This is because they not only harbour the risk of official sanctions, but also, to a much more threatening extent, reputational damage.

The establishment of the EU's anti-money laundering authority raises Frankfurt's profile as a city of short distances and direct dialogue with supervisors. This is precisely why the establishment of the AMLA strengthens the pull that "Europe's capital of authorities" exerts on financial service providers.