Today I will lay before Parliament a departmental minute describing the purchase of a shareholding in Mercator Ocean and the resulting contingent liability.
Copernicus is the EU earth observation programme that monitors the global health of the planet. Mercator Ocean is the “co-ordinating entity” for the Copernicus marine services which provides free and open access to constantly updated information about the global ocean and the seas of the European region. Mercator Ocean is currently owned by five French public institutions with an interest/obligation to deliver research aligned to operational oceanography. It is broadening its ownership structure to be more in line with other delegated authorities.
The Secretary of State, acting through the Met Office, intends on 29 November 2017 to buy a 5% (€100k) share of Mercator Ocean, alongside equivalent organisations from Norway, Germany, Italy, Portugal and Spain.
The organisation is a “société civile” (a not-for-profit organisation) under French law, meaning it has unlimited liability, and its shareholders are exposed to liability risk in proportion to their shareholding. A remote contingent liability will therefore exist as long as the Secretary of State retains a shareholding in Mercator Ocean.
The organisation protects its shareholders through contractual mechanisms and through insurance. Also any residual claim would first be met from the assets of the company. Any contingent liability is considered to be extremely remote. In addition any contingent liability will cease to exist should the Met Office dispose of the shares, which it is able to do so at cost at any point within the first three years of ownership, and with six months’ notice after this point.
Regrettably, on this occasion pressing commercial requirements to procure the shares have meant that it has not been possible to provide the full 14 sitting days prior to taking on the contingent liabilities.