EU faces £370m invoice after US agency goes bust, saddling it with post-Brexit white elephant | Politics | News | EUROtoday

Get real time updates directly on you device, subscribe now.

The European Union is dealing with the prospect of stumping up £27million for an enormous workplace bloc in London vacated after Brexit, confidential papers have indicated, with the invoice having the potential to rise to an eye-watering £370million.

The 280,000-square-foot constructing, 30 Churchill Place in Canary Wharf, was beforehand utilized by the European Medicines Agency (EMA).

It was leased to US workplace rental enterprise WeWork after Britain stop the EU – however the future is unclear after the corporate filed for chapter in November.

The EMA signed a 25-year lease value £500million for the property in 2011 – 5 years earlier than the pivotal referendum.

As a consequence, it relocated 900 employees to Amsterdam, and after an unsuccessful High Court declare that Brexit had “frustrated” the lease settlement, struck a cope with WeWork to sublet 10 flooring of workplace area in 2019.

However, a doc circulated to the European Parliament’s price range committee and seen by The Daily Telegraph mentioned the UK department of WeWork would quickly cease paying lease on the constructing.

If it stays empty for the remainder of the 12 months, the EU will face a invoice of £27million invoice, with the EMA, which is an company of the bloc, already requesting extra cash to cowl the hit to its price range.

MEPs should quickly resolve whether or not to cowl the £4.55million it is going to owe for the primary three months of 2024.

A briefing word mentioned: “The Agency’s current budget for 2024 does not have funding for additional costs outside its annual programme.

“As negotiations with WeWork UK continue, it appears increasingly likely that the Union budget will need to contribute towards the rent of the 30 Churchill Place premises, which has until now been fully covered by WeWork UK.”

The EU’s lease on 30 Churchill Place runs till June 2039, that means will probably be chargeable for £373million in lease if a longer-term resolution will not be recognized.

Frank Furedi, the manager director of the MCC Brussels suppose tank, mentioned: “EU taxpayers are on the hook for millions of Euros because of bad decisions by EU agencies.

“We are still paying for the incompetence of the EMA not negotiating an exit clause of their expensive London property.

“There was no need to rush forward to move the European Medicines Agency from London after Brexit, but because of that arrogant decision by the EU, millions will be wasted.”

A Wework spokeswoman mentioned: “We are up to date on our lease obligations at 30 Churchill Place, which remains open and operational.

“As part of our previously announced process, we continue to work constructively and collaboratively with our landlord partner at this flagship location to craft a solution that mutually benefits both parties for the long term.”

An EMA spokesperson mentioned: “WeWork filed for ‘Chapter 11’ bankruptcy protection in New Jersey (United States) on 6 November 2023, in the context of an ongoing reorganisation of its business activities. Chapter 11 of the US Bankruptcy Code is a procedure which allows a debtor to remain in possession, continuing to operate its business, while a restructuring plan is agreed with its creditors. The bankruptcy protection filing concerns WeWork’s branches in the US and Canada only.”

WeWork continued to hold on operations from its London premises and was not in breach of its monetary obligations, the spokeswoman harassed.

The spokesperson added: “The rate of occupation of WeWork working spaces at 30 Churchill Place is currently one of the highest in London. The allegation that the giant space is now empty with none of it rented out to other businesses is devoid of any foundation.

“Following the submitting for chapter, WeWork has been in touch with its landlords together with EMA with the intention to re-negotiate their leases.

“The Agency is in close contact with the EU Institutions to address the situation, in line with the provisions set out in its financial regulation and to ensure that it can focus its resources on its public health mission.”