AZ - EU contract published

[Davros]

Breaking news on BBC

@Baileysforchristmas

The EU are still demanding the UK hand over the vaccines, it’s in theGuardian, the EU still seem to think the contract is in their favour?

I don't understand what Britain has to do with this.

The contract was between the EU and AZ. If the EU gave GB vaccines which should have been reserved for the EU, and that's in doubt, then that's still not Britain's problem. It's a contractual dispute between the EU and AZ, not between AZ and GB.

So the EU were too timid to take a risk and hand of the money early with an instant order, they hedged their bets and now want to jump to the front of the queue?

Seriously, who the fuck do they think they are?

The UK need to stand hard on this. The EU has spent the past four years being undiplomatic and insulting. The UK should hold strong and leave them both empty handed AND humiliated.

wow - this is so incredible I just wonder how A Z will get around this - get a message across?

Pr Teams a go go....possibility to totally tarnish their rep in so many ways - unethical - not honoring a contract..woolley badly written contracts - etc etc!

AZ has explicitly confirmed to the EU that it is not under any prior agreement that would impede fulfilment of its obligations under the agreement with the EU.

twitter.com/JamesCrisp6/status/1355129891902148611

For all "it is only reasonable efforts" fans: note that the term is defined in the contract and that the contract is under Belgian law, so that any UK law understanding of the obligations created "reasonable efforts" is irrelevant.

What exactly do the eu expect?

That doses should have been held back for if /when they approved the vaccine .,, in the middle of a pandemic

Or that AZ should now break other contracts ?

Are Pfizer getting similar treatment ?

And didn't the uk deal precede the eu one ? Or is that not what is meant by supersede tweet ?

I dont think that's what it says.

Is says it isnt in any prior agreement that would influence the initial doses.

So if as a company you have a contract to definitely fulfil x number of doses. X number of doses are going to be allocated to that contract. Then subsequent doses allocated as the first dose to the EU. The contract refers to those, so an export ban might refer to those. Not a previous contract.

You cant force a company to break a previous contract because you dont like it.

If the EU dont respect contract law that's a real worry

My rough understanding is:

1. EU invested in Belgian plant (100ms of Euros)

1. AZ confirmed that it had no conflicting obligations to be able to use the entire production in the EU for the EU contract

1. AZ agreed to use "best efforts" to produce vaccine.

1. In breach of 2., they actually sent production from the EU plant to UK to fulfill their UK contract while telling EU that they can't fulfill their delivery obligations

1. EU therefore requesting those doses back.

Copying over from other thread as more relevant here

Okay so what do you think of this strategy (I'm working on the premise that a company like this can have its strings pulled by governments, in this case the UK government):

If the EU ends up steamrolling AZ into defeat, then how about AZ says that clearly it has no choice but to supply the EU now - however, to make up for losses caused by the EU disrupting supply schedules like this, it will now no longer be able to supply its vaccines at cost to poorer parts of the world (obviously it doesnt have to utlimately go through with this, but maybe it can damage the EU's reputation and/or shame it into relenting)

2. AZ confirmed that it had no conflicting obligations to be able to use the entire production in the EU for the EU contract

Did AZ do this though?

The EU are attempting to argue that the "best efforts" bit refers to developing the vaccine and that, now the vaccine is available, AstraZeneca must deliver. That is clearly not what the contract says. The preamble is very clear that AZ must use best efforts to build the capacity to deliver 300M doses.

Clause 5.1 also commits AZ to use its best efforts to manufacture the EU's initial deliveries within the EU. Clause 5.4 requires AZ to use its best efforts to manufacture within the EU and UK, and sets out the process if AZ wants to manufacture at sites outside the EU and UK.

The EU appears to be arguing that "best efforts" only applied until the vaccine was been developed. Bluntly, on a quick read of this contract, that interpretation is unsustainable. If the EU attempts to take AZ to a neutral court over this I would expect AZ to win. I could, of course, be proved wrong but I struggle to see how a court could possibly interpret this contract to mean what the EU says it means.

By publishing this the EU appear to have removed all doubt. They are in the wrong. Of course, they desperately want to blame someone else for the slowness of their vaccine rollout, but it is their own fault. They prioritised their processes over speed, forgetting that delays cost lives. Now, sadly, those who live in the EU are suffering a slow vaccination programme as a result of the EU's failures.

I can see where the non-lawyer EU bods are getting confused, but think it's pretty clear personally.

The contract describes two different types of order; the 300 million "initial doses" and a potential later order for "optional doses".

Section 5.4 says that manufacturing sites are in the EU (including the UK, FOR THE PURPOSE OF THIS SECTION 5.4 ONLY) and else with the EU's agreement. The EU is clearly reading this as they can take UK manufactured doses right now.

However, Section 5.1 says that the 300 million "initial doses" will be manufactured in the EU (WHICH DOESN'T INCLUDE THE UK BECAUSE THIS ISN'T SECTION 5.4!). This entirely supports what Soriot said in the Repubblica article, that the EU can UK manufactured doses, but only later on.

@IcedPurple

2. AZ confirmed that it had no conflicting obligations to be able to use the entire production in the EU for the EU contract

Did AZ do this though?

Yes they did.

13.3 (e)

twitter.com/JamesCrisp6/status/1355129891902148611

So basically, the contract refutes the EU's stance.

I dont think they would take them to court over this. It would be too embarrassing.

The question is though, despite being in the right, will AZ cave and supply them the way they want just to be able to move on? Why would they do that/why wouldn't they do that? What's at stake for AZ?

Is all this fuss over the 4 million doses 'given' to Britain from EU production plants? Because that seems like a relatively trifling amount given that the population of the EU is nearly half a billion.

That doses should have been held back for if /when they approved the vaccine

The estimated delivery schedule was subject to final agreement and regulatory approval which still hasn't been given but it appears the EU thought AZ would stockpile for them whilst denying access to those ready to proceed with vaccinating.

I do not understand why the commission is doubling down on this. I feel really angry for EU citizens.

The U.K. contract was for x batches of vaccines. The EU contract is for y (totally separate) batches of vaccines. AZ signed its contract with the U.K. three months before the EU did and the AZ U.K. contract is about x batches- not y. The x batches are supplied when ready (and the U.K. has invested significant time and money in its U.K. supply chain to get the manufacturing process sorted, whereas the EU has failed to do so). AZ says it’s will use best endeavours to supply the y batches to EU- best endeavours does not mean breaching existing contracts. It means best endeavours in the circumstances that apply to the y batch (ie problems with the EU supply chain will impact the y batch). The EU effectively wishes to steal x batches from the U.K to make up for a shortfall of y batches.

@bongsuhan

My rough understanding is:

1. EU invested in Belgian plant (100ms of Euros)

1. AZ confirmed that it had no conflicting obligations to be able to use the entire production in the EU for the EU contract

1. AZ agreed to use "best efforts" to produce vaccine.

1. In breach of 2., they actually sent production from the EU plant to UK to fulfill their UK contract while telling EU that they can't fulfill their delivery obligations

1. EU therefore requesting those doses back.

As far as I can see, point 4 is wrong. AZ has not sent any doses produced in the EU to the UK. Point 5 is therefore also wrong.

The reality is that yields at the Belgian plant are currently low. The EU is demanding that AZ make up for that issue by diverting doses manufactured in the UK for UK use.

All I really want to know is...will This delay UK vaccinations?

It depends on how bad the spat gets and on how much we rely on materials from the eu to keep our vaccine plants going

"As far as I can see, point 4 is wrong. AZ has not sent any doses produced in the EU to the UK. Point 5 is therefore also wrong."

I think this is in dispute and the reason why the EU was discussing transparancy and requesting a review of deliveries - i.e. they suspect it but are possibly not sure.

It is so arrogant of the EU to act like it’s contract has anything to do with the UK’s. They seem to think the U.K. remains an EU state that can be bullied into submission.

It’s laughable that this comes so soon after the EU implying that it didn’t trust the U.K. to honour the Deal with the EU. Pot, kettle.

Agree with happyFridays21, by the way. The EU appears to be interpreting clause 5.4 to mean something different to what it actually says. It allows AZ to manufacture in the UK for EU use but not for the initial doses and certainly does not give the EU any right to demand that AZ supply the EU with doses that were manufactured for UK use.

A BBC article yesterday (the one describing Gove's statement) said that an early UK batch was sent to the Netherlands for putting into vials while we were still working on the Wrexham plant to do that. If that's the 4 million that's getting quoted everywhere then the EU is even further left without a single leg to stand on.

It makes sense, because if EU manufacturing was able to make 4 million doses in a batch a couple of months ago then they'd probably be much further forward now.

The BBC's the only place I've seen this, but let's face it, if the BBC thought there was any chance at all that the EU was in the right they'd be taking their side 100%.

@bongsuhan

"As far as I can see, point 4 is wrong. AZ has not sent any doses produced in the EU to the UK. Point 5 is therefore also wrong."

I think this is in dispute and the reason why the EU was discussing transparancy and requesting a review of deliveries - i.e. they suspect it but are possibly not sure.

They have certainly asked for the Belgian site to be inspected, suggesting that they hope to show AZ is lying about yields and that therefore vaccines manufactured in Belgium are being supplied to non-EU countries. There is no way of knowing for certain but I suspect the inspection will show that AZ is telling the truth.