Thursday, February 18, 2021

As Britain's cheating on vaccines is revealed, the EU has a duty to react (EN)

There isn't much to add to CNN's revelations about UK's contract with AstraZeneca (AZ) for on covid-19 vaccines, but it's worthwhile summarising the main facts:

  • The British authorities have been apparently trying to keep the deal with AZ as a national security secret, but inadvertently made it available online back in November last year.
  • UK's contract with AZ is very similar to EU's contract, in particular with regard to the "best reasonable efforts" clause. 
  • UK's contract with AZ is officially dated one day after EU's contract with the company.
  • The British contract also mentions that vaccines can be delivered from production sites in the EU, just like the EU contract also lists production sites in the UK.
In brief: no significant difference between the two contracts, whether in respect to the "best reasonable efforts" clause, to the time of concluding the contracts (only a day's difference, with EU's the earlier one) or to the sourcing of the promised supply.
These are explosive revelations and the implications deserve a discussion.

To recall, back in January Pascal Soriot, AZ's CEO, said that the "best reasonable efforts" clause meant that there was no binding obligation to deliver to the EU, and - to justify why AZ was still delivering in full and on schedule to the UK while failing the EU - that he had a priority commitment to the Brits because they had signed a contract earlier. 
wrote at the time about his brazen attempt to gaslight the EU and public opinion on AZ's failure to meet its contractual obligation while giving preferential treatment to the UK, showing that none of his arguments could stand scrutiny. But I didn't expect that he would be plainly lying on record, as it has now become clear. 

To put things into context: AZ's substantial cut of its deliveries to the EU significantly delayed the vaccination programme in the 27 Member States. Meanwhile, the UK has been vaccinating at speed, receiving timely supplies of both the AZ vaccine (from both EU- and UK-based plants) and of the BioNTech-Pfizer one (exclusively from EU-based plants). The European Commission was harshly criticised for signing a contract with AZ too late, for being too bureaucratic, for incompetence on pharma contracts. The whole issue became poisonously mixed with post-Brexit politics, with the EU's 'failure' and UK's 'triumph' widely presented as a vindication for Brexit. Paradoxically, while the EU produces three quarters of the world's vaccines, it emerged 'defeated' in the vaccination efforts.

The reality, as I already argued and is now becoming crystal clear is very different: the EU did nothing wrong and AZ is in breach of contract. Moreover, my initial hypothesis (based on circumstantial evidence at the time) that there has been foul play by the UK is now largely confirmed by the facts as they emerge.

In brief, we now know for a fact that the UK has enforced a de facto export ban vs the EU on the AZ vaccines, while in turn it has been supplied from the EU with both AZ (at least in late 2020) and with BioNTech-Pfizer vaccines (continuously since December 2020). We also know that the UK government has tried to keep secret relevant information related to their contract with AZ and their vaccine supplies, while encouraging the narrative taking hold in the media according to which the UK had signed its contract earlier and had secured better supply guarantees.

We don't know yet whether Pascal Soriot's misleading and arrogant statements in relation to the EU were directly encouraged or dictated by the British government. But there are strong reasons to believe so, otherwise why would a businessman with a lot to lose choose to play with political fire? I have no doubt we will learn more about this in the coming period.

The EU, and the Commission in particular, has been very timid on this issue so far, especially after its uncharacteristic blunder of  mentioning the possibility to trigger Article 16 of the Northern Ireland protocol in the context of instituting export controls on vaccines (a mistake promptly capitalised upon by the Brits). The export notification system introduced for vaccines has remained a simple formality so far, as all shipments to third countries were allowed to proceed.
But in the face of the latest revelations on Britain's cheating on vaccines, the Commission has an urgent duty to take its responsibilities to defend the interests of the EU and of its citizens. Failure to do so would not only translate into more 'triumphs' for the anti-EU propaganda of the Brexiteers, but would lead directly to unnecessary loss of human lives in the Member States.

Concretely, the Commission should:
  • Open a legal case against AZ for breach of contract, claiming significant damages and the proportional compensation of failed deliveries from the future production, including at UK plants. UPDATE 19/02: The lawsuit appears not to be an option in light of the latest revelations on the (full, non-edited) contract.
  • Enforce its vaccine export controls by applying a strict proportional criterion to deliveries from the EU to third countries - so that it is no longer possible for the EU to be left waiting while other countries are supplied on schedule. It's only fair for production shortages to impact proportionally on all buyers, not on the EU alone.
  • In relation to third countries, enforce a reciprocity principle: a country that receives vaccines from the EU cannot ban its local producers from supplying the EU.
  • Not least, set the record straight and change the narrative on UK's vaccine 'triumph' and EU's 'failure'. The reality is that the UK has cheated, and that the EU has perhaps been too naive or too timid to stand for itself. As facts come into the open, there should be a deliberate communication effort about them, to prevent the truth being swept under the rug.
As to UK's bullying in relation to the Northern Ireland protocol, I expect the Commission - after having already admitted and rapidly corrected its mistake on Article 16 - to keep its cool. Vice-president Sefcovic's line that the UK has first a duty to implement the protocol in good faith before asking for changes to it is a good start. 


  1. Hello !

    Well, it seems that the January heat has pretty much got a cold nowadays in February, and no one is paying much attention anymore to the AstraZeneca EU affair.

    Your insistence on this affair deserve however praise, as it is a multi-layered dispute, potentially epitomizing the shape of the things to come between EU and UK in the near future.

    Without disagreeing greatly with your analysis, I have nonetheless three things to point out.

    One, AstraZeneca is an Anglo-Swedish company, so why being surprised that they played for the British interests ? Ok, it's a multinational with no soul neither soil attachment, but, but, being a British company rather than a shareholders' asset could be more rewarding in these troubled times where we hear a lot the music of patriotism and sovereignty.

    Two, the EU has shown, just as in the recent Borrell trip to Moscow, that it has no nerves to play hardball when the game is getting tough. It was an honest display of fair play from its part, playing by the rules and contracts, but the vaccines' game had in fact no rules and any foul play was permitted as long as the jabs were getting shot in the arms. Is it finally accurate that the Mossad was involved in the Israeli procurement of vaccines ? In my view, the EU was simply unable to match the realpolitik clout of the traditional powers, eager to do whatever it takes to get through the pandemic.

    Three, I don't think for a second that the EU will get AZ in court for compensation and punishment, because it's not a simple commercial dispute : it's too charged politically and the EU has already lost the narratives' battle with regard to UK/AZ, so any court action will look like a revenge, whilst the European Commission will not have enough political capital to lose in another spat like this.

    In the end, the Brits have somehow won a battle, but the pandemic is far from over and we don't know who will win the war against the virus.

    1. I agree it has been a communication debacle for the Commission three weeks ago. Frustratingly, it is now becoming clear that it has done nothing wrong (except the mistake on Art.16 of the Northern Ireland protocol) but it allowed itself to be bamboozled and depicted as incompetent and the villain of the whole story.
      And you may be right that the EU hasn't appeared to have what it takes to play the rough games of 'realpolitik'.
      But I totally disagree that it should let this go. The facts are coming out and showing a very different reality to the narrative that took hold and there is an opportunity to set the record straight. This is not trivial, because perceptions matter. If history will retain that the EU has botched its vaccination drive due to an incompetent bureaucracy, and will therefore be to blame for thousands of deaths among its citizens, how will it be able to move on in the post-pandemic era? What legitimacy will it retain at all?
      And perhaps more importantly, the Commission still has a duty to protect the lives and livelihoods of Europeans and cannot abdicate from this duty. This also means securing now and for the coming months its fair share of the contracted vaccines and not let itself be bullied and intimidated by the UK.