The Swiss town of Baar boasts clean air, easy access to ski slopes and some of Europe’s lowest personal taxes. London? Traffic and perpetual drizzle.

Yet executives at Noble Corp., a provider of deepwater oil drilling rigs, are in the process of moving headquarters from Baar to the British capital, citing the talented workforce and easy airline connections from Heathrow, Europe’s busiest international airport. On top of that, the U.K. tax rate is now competitive with Switzerland’s historically corporate-friendly tax regime.

Noble is part of a wave of overseas companies moving head offices to London, lured in part by the country’s declining corporate taxes. The relocations underscore Prime Minister David Cameron’s efforts to make the country more attractive to foreign companies — and may help London become less dependent on the financial services industry, which has been retrenching since the 2008 crisis.

“There is definitely a swing back to the U.K. under way and I think there will be more,” said Angus Winther, a senior adviser at investment bank Evercore Partners Inc. in London. “There are huge advantages: you have a vast talent pool, infrastructure, language, and lowered tax rates.”

Last year 45 foreign companies moved their global or regional headquarters to London, up from just 25 in 2009, data from research group FDI Markets show. Among the moves this year: General Electric Co.’s oil and gas unit, which is departing Florence, Italy, and Chinese developer ABP (China) Holdings Group Ltd., which is setting up its worldwide head office in London.

Tax Rates

While London’s many cultural opportunities, theater and good restaurants are a draw, a series of cuts in corporate income tax rates by the Conservative Party-led government has been a key motivating factor. The U.K.’s base corporate rate is now 23 percent, down from 28 percent in 2010. By 2015, the rate will drop to about 20 percent, compared with about 29 percent in Germany and about 33 percent in France. The U.S. rate is 40 percent, though deductions mean few companies pay that amount.

“Five or ten years ago, a lot of companies were thinking about moving to places like Ireland or the Channel Islands,” said Dan Schuster-Woldan, a partner at law firm Linklaters. “Things have changed. There are now fewer companies going that route because the tax differential is lower.”

Tax Neutral

Noble is one example. Chief Executive Officer David Williams said in July the move would be tax-neutral for the company — showing how U.K. tax changes have made the country comparable with Switzerland. The average Swiss corporate tax take is about 18 percent, and as high as 24.4 percent in some regions, according to accountancy firm KPMG.

Other firms with U.S. roots have done the same. Aon Plc, the world’s second-largest insurance broker, last year moved its headquarters from Chicago to London, saying it would give the company better access to emerging economies and the Lloyd’s of London insurance market.

Taxes also played a role, with the company crediting a U.K. territorial tax system that would drive “significant value to shareholders” in a 2012 regulatory filing.

In addition to slicing the corporate tax rate, the British government last year reduced the amount of tax owed on profits earned outside the country. That prompted some U.K. firms that had moved offshore to return.

Ad Agency

WPP Plc, the world’s largest advertising agency, last year announced it would return its headquarters to London after moving to Dublin in 2008 in protest of the so-called double taxation. Investors in UBM Plc, the owner of PRNewswire, voted to do the same.

Some of the moves are being executed through merger deals, raising speculation that, like their counterparts in Ireland, U.K. companies could become attractive targets because of their address, rather than just their assets.

Liberty Global Plc used a takeover of broadband provider Virgin Media to move its headquarters to London and give up a U.S. tax domicile. Italian truck maker Fiat Industrial, after merging with its farm equipment unit to form CNH Industrial, is also moving its base to the U.K. while registering in the Netherlands.

The U.K. still faces stiff competition in its bid to attract investment.

American companies including Perrigo Co. and Actavis Plc are planning to re-incorporate in Ireland after completing mergers with Irish companies. Ireland’s corporate tax rate of 12.5 percent is among the world’s lowest.

Netherlands Neutrality

The Netherlands will be the home of the new company created by the proposed merger of advertising giants Omnicom Group Inc., based in New York, and French rival Publicis Groupe SA. The Dutch corporate tax rate is about 25 percent. Publicis Chief Executive Officer Maurice Levy has said the move to the Netherlands was motivated by the country’s neutrality, not its taxes.

The renewed interest in London from companies in a broad range of industries comes as the financial sector retrenches. The number of people employed in London’s financial services firms is likely to decline to 236,000 next year, the lowest level since 1993, according to the Centre for Economics and Business Research. The financial sector, which is overwhelmingly concentrated in the capital, accounted for 11.6 percent of total tax receipts last year, down from 13.9 percent in 2007, according to the City of London.

Standard Chartered

Some hedge funds and asset managers have quit London for Switzerland, blaming tighter financial regulations. And banking giants HSBC Holdings Plc and Standard Chartered Plc, which have the bulk of their operations abroad, haven’t ruled out an eventual move to Asia.

Still, London growth is outpacing the rest of the country. The city’s economy will grow by 1.9 percent annually to 2018, 0.5 percent faster than the U.K. as a whole, the CEBR said this year.

Part of the growth is coming from technology companies as London emerges as the undisputed European capital for Internet businesses. Both Amazon Inc. and Google Inc. are building large new facilities in the city, with the search giant pledging to employ 5,000 staff in a new office next to the renovated King’s Cross railway hub.

While headquarters moves motivated in part by tax arbitrage don’t necessarily bring many jobs to London, they at least create work for local professional-services providers like lawyers and management consultants, said Mark Gregory, the chief U.K. and Ireland economist at Ernst & Young LLP.

Business Destination

To be sure, London’s appeal as a business destination isn’t assured. The opposition Labour Party has said it will reverse corporate tax cuts if it returns to government.

The potential of a British exit from the European Union, which Cameron has said will be put to an eventual referendum, also complicates London’s sales pitch. Almost 80 percent of firms surveyed by the Confederation of British Industry, a lobby group for big U.K. companies, support continued membership in the EU, which administers tariff-free trade between its member states.

Meanwhile, business groups have criticized new immigration rules, introduced by Cameron, that make it harder for companies to hire even highly skilled workers from outside the European Union and to keep them in the country long-term.

Whether London will keep wooing foreign business to re- balance its economy away from banking will be determined by a combination of those policies, tax rates and intangible characteristics — like its cosmopolitan atmosphere and educational institutions, said Ajay Bhalla, a professor of innovation management at Cass Business School.

“Those will be the deciding factors of whether re- balancing is possible,” Bhalla said.

–With assistance from Ruth David in London, Tommaso Ebhardt in Milan and David Wethe in Houston. Editor: Larry Reibstein