American companies still prefer London over other locations in Europe. But other cities are grabbing up their share of U.S. expansions.

"Ten years ago most American companies would have gravitated to London, Paris and Amsterdam and not much else," said Barry Bright, director of location advisory services for Ernst & Young in London. But today American companies are going to cities such as Dublin, Munich, Berlin, Barcelona, Copenhagen, and even Budapest. According to results from E&Y's European Investment Monitor, the UK received nearly 10 percent of U.S. investment into Europe in 1999. Paris and Dublin followed with 3 percent.

"Ten years ago you would have never found Copenhagen or Berlin among the top 10 on this list," said Bright.

Bright attributes this widening variety not only to the creation of the EU, but tight labor markets in major European cities. Companies that focus solely on tax breaks and incentives may be out of luck.

"The only cities on the list to offer such incentives are Dublin and Berlin," said Bright.

U.S. companies should not consider only the "usual" locations in Europe.

"Consider other choices and make comparisons," said Bright.

He offers a quick assessment on the pluses of the top 10 European markets.

London - "It offers advantages of English language and ease of entry into Europe. The city is one of the world's most expensive, however. Primary industries include financial services, information technology (IT), software development, and e-commerce."

Paris - An attractive city, Paris is only one-third of London's size. Costs are cheaper than in London, plus it offers good transportation.

"Paris invested in its infrastructure and it works well," he said.

Dublin - At 12 percent, Dublin offers Europe's lowest corporate tax rate, plus a 10 percent cash incentive for investments.

"If a company is looking for a tax break, Dublin makes sense," said Bright. "Its labor force is young and well educated."

Frankfurt - The city is Germany's biggest commercial center. Productivity is high. The city is a well-developed financial services center, and has attracted high technology firms. Labor is expensive, but the cost of living is much cheaper than in London.

Amsterdam - Expatriates enjoy tax breaks. The work force is cosmopolitan, and the city offers excellent transportation, telecom and flight connections. Amsterdam is cheaper than Paris and Frankfurt.

Munich - The city has an outstanding quality of life. Large investments have been made in infrastructure and transportation. Munich's economy centers on dot.coms, e-commerce, and software development.

"Everything works," said Bright.

Berlin - It offers an available and skilled work force. Unemployment still hovers around 10 percent.

"Berlin is a big city with attractive tax breaks," said Bright.

Barcelona - Lowest cost city on E&Y's top 10, Barcelona offers a combination of Southern Californian and European culture.

"Values are good here," said Bright. "A host of regional headquarters and call centers are locating here."

Brussels - Costs in this capital of the EU are reasonable except for labor. Employment taxes run at 40 percent, compared to Dublin's 11 percent, and Frankfurt's 27 percent. Tax breaks are available for foreign operations and expatriates.

Copenhagen - Copenhagen is a natural hub for the Nordic countries. Social taxes are reasonable and the people speak more than one language.

"When companies consider Scandinavia, they look at Copenhagen or Stockholm," said Bright.

Karen Thuermer is a Berwyn, Pa.-based freelance writer.