The premature termination of the lease agreement for a building in London will cost the European Medicines Agency (EMA) an additional 80 million euros on top of the initially estimated rental price until 2039, European media reported on Friday.
The rental costs were initially estimated at 350 million euros, but in a presentation last month in the European Parliament, which was closed to the public, the total cost of the premature termination of the lease was estimated at 429.3 million euros.
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The European information portal EUobserver requested that the presentation be provided to them, and their request was granted.
The total cost of relocating the EMA from London, necessitated by Britain’s exit from the European Union, is estimated at 582.5 million euros. The amount is known, but individual items were presented for the first time in the presentation.
A significant portion of that amount is attributed to the EMA’s obligations to the landlord. The lease agreement for the building in Canary Wharf in London’s business center stipulates a lease duration until 2039, or 20 years after Britain’s expected exit from the EU – and does not contain a clause for premature termination.
The figure does not include costs in case of building maintenance failure but is based on an assumption of a “worst-case scenario,” according to the presentation.
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Subleasing the building is only possible under “strict conditions” and with prior permission from the landlord, it is added.
Other relocation costs for the EMA include 28 million euros in compensation for employees preparing for the move.
The agency will withdraw 43 employees from regular duties to prepare for the relocation to the new site, notes EUobserver.
Employee relocation costs, including travel to the new location, language courses, and “moving costs” are estimated at nearly 23 million euros.
The costs of relocating IT services are estimated at around 11 million euros.
The agency is also expected to spend about 833 thousand euros on preparatory visits to the new location and visits to the European Commission and the European Parliament in Brussels for discussions about the relocation.
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The document also states that the agency expects to send four employees to the new host country for 12 hours each month until the end of March next year, and two employees every two weeks for two days from 2018 to March 2019.
An additional million euros will be spent on “business visits” to the new location, the presentation states.
Nineteen European cities, including Zagreb, have applied to host the European Medicines Agency, while eight cities wish to host the European Banking Authority (EBA), which is currently also located in London.
Brexit has been assessed in the presentation as the “biggest challenge for the EMA since the agency’s establishment.”
The decision on the final responsibility for the agency’s relocation costs will be made in negotiations between the EU and the United Kingdom, it is emphasized in the presentation, with an additional note that the funds for actual costs must be secured before the physical relocation.
