UK’s decision to leave the Single Market drives the EMA out of London
In her letter of 29th March 2017 to Donald Tusk, notifying him of the UK’s intention to invoke Article 50 so as to set in motion its departure from the European Union, Theresa May stated that the “UK does not seek membership of the single market”.
One implication of leaving the single market is that the UK would automatically lose its membership of most of the 40-odd EU decentralised agencies which orchestrate and continuously update EU policies and programmes in all sectors in which members stand to benefit from coordinated strategies and activities.
One of these agencies is the European Medicines Agency (EMA) which is headquartered in London. Probably very few British people who voted in the EU Referendum had heard of the EMA, let alone knew what it did, until the European Commission announced that it was planning its transfer to another EU member country as of the date of UK’s exit on 29th March 2019.
On 20th November 2017, Amsterdam was selected as the new location for EMA headquarters and planning began for the transfer of staff. At that time, L4E posted an article entitled Mindless Brextruction: £500,000,000 down the drain as a sop to politicians’ vanity – and nobody turns a hair! We lamented that loss of EMA and the failure of the Government to take any steps to halt the process.
At the time, it was assumed that Britain would have to meet the full costs of the transfer, estimated at about £500 million. Some 900 staff and their families would have to be transferred to a new office in Amsterdam; EMA’s annual budget of about £300 million would no longer be spent in London, and the city would forfeit about 30,000 business visitors per year. Many UK-registered pharmaceutical industries would find it advantageous to shift management staff to Amsterdam.
Early this month the Dutch government signed a Euro 255 million contract for the construction of the new EMA headquarters building and its maintenance for 20 years.
May’s late awakening
In her recent Mansion House speech on post-Brexit arrangements with the EU, May belatedly awoke to the advantages of continued membership of EU decentralised agencies including the EMA. She said:
“We will also want to explore with the EU, the terms on which the UK could remain part of EU agencies such as those that are critical for the chemicals, medicines and aerospace industries….
I want to explain what I believe the benefits of this approach could be, both for us and the EU.First, associate membership of these agencies is the only way to meet our objective of ensuring that these products only need to undergo one series of approvals, in one country.
Second, these agencies have a critical role in setting and enforcing relevant rules. And if we were able to negotiate associate membership we would be able to ensure that we could continue to provide our technical expertise.
Third, associate membership could permit UK firms to resolve certain challenges related to the agencies through UK courts rather than the ECJ…..
Fourth it would bring other benefits too. For example, membership of the European Medicines Agency would mean investment in new innovative medicines continuing in the UK, and it would mean these medicines getting to patients faster as firms prioritise larger markets when they start the lengthy process of seeking authorisations. But it would also be good for the EU because the UK regulator assesses more new medicines than any other member state. And the EU would continue to access the expertise of the UK’s world-leading universities.”
The main flaw in this argument is that it comes at least a year too late, long after May irresponsibly drew a red line that told us of her determination to leave the EU single market – and hence also the EMA and other decentralised agencies. The EMA has already made it abundantly clear to the pharmaceutical industry that, as of 30th March 2019, the UK will be treated as a “third country”. It has already invited all concerned entities to plan for this in a letter entitled “Regulatory guidance for pharmaceutical companies to prepare for UK’s withdrawal from EU”.
Secondly, her arguments for membership of the EMA are hardly likely to cut much ice with other EU members, given the huge upheavals she has already caused for the Agency and the pharmaceutical interests with which it works.
Thirdly, even if she managed to gain some form of associate membership, this would exclude Britain from any management role, prevent UK nationals from working in the EMA, and cost a hefty annual fee. The UK would also end up at the back of the queue for medicine approvals, putting our health at risk.