Takeover of the GA: calling UBx

This is for @lucechiodelliub.

Luce: we would like to perform a universal takeover of OpenCare’s GA. The entity taking over from Edgeryders would be a new company, also called Edgeryders, incorporated in Estonia. After Brexit, we decided to shut down the British company and move shop. We are now ready to go. We prefer not to wait for the project to be over, because a secondary effect of Brexit is difficulties with banking for British companies with “too many non-residents on the board”. This is limiting our ability to operate at a critical time, with the OpenCare festival coming up.

I contacted the Horizon 2020 Helpdesk, and received an encouraging response (below). Could you please:

  1. Formally contact the Commission, explain the situation, and say that we would like to perform a universal takeover from Edgeryders Limited By Guarantee to Edgeryders Osahüing (PIC 912799780).
  2. Verify that we indeed do not need an amendment to the GA.
  3. Ask what else we should do.

The new company has not been validated yet: so, I guess the validation service should do its thing before the takeover can be approved.

Thank you so much, I am sorry to give you all this trouble.

Below, an excerpt from the answer I received from the H2020 Help Desk.

For instance, change of beneficiary due to universal takeover (i.e. where the original entity is replaced by one new entity and all rights and obligations – including the GA – are transferred to this new entity, e.g. merger of full acquisition) does not require an amendment; however, change of beneficiary due to partial takeover (i.e. where a part of the business of the beneficiary – including the GA - is taken over by one or more entities e.g. partial acquisition, distribution of a business unit after dissolution/liquidation, division/demerger) requires an amendment to the GA.

You may find more information on the case that would require an amendment, including the list of the necessary supporting documents to be submitted for each type of amendment in the guidance document ‘Amendment types & supporting documents’ published:

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UK CLG is infinitely flexible.

My advice would be to amend the CLG constitution to create two classes of member.

Edgeryders Osahuing could become a corporate ‘Development/Management Member’ or similar with executive powers, with the other stakeholders being a different class of (associate) individual member.

CLG then acts as Custodian for fund flow accounted for internally within the CLG. @patrick_andrews ?

Interesting. But what’s wrong with just moving shop over to Estonia, and shutting down the British company? One less tax return to do, four VAT returns less, saving on accountant fees.

The main point of pain is banking. British banks do not like foreigners. We bank with HSBC: the service is terrible and expensive. No other bank would accept us as customers, because “too many non residents on the board”. And the British pound just adds complexity and currency exchange risks: we never use it for anything, except paying taxes. We don’t feel welcome, so we don’t want to stay.

Useful context.

It makes complete sense to ship out the funding vehicle to Estonia.

But for reasons we can develop at OpenVillage, a UK CLG imaginatively re-engineered can potentially enable the financing/funding through membership classes of a global platform/network of Open Villages. Just because it’s a UK Company does not mean it cannot maintain €, $ or other (eg energy) denominated accounting.

So setting up Edgeryders Estonia as you suggest makes complete sense for reasons given, but if I were you I wouldn’t bin the CLG entirely until you’ve explored the options.

Thanks for the advice @chrisjcook. Would be nice to discuss it in person. Are you going to be at the Brussels event?

Here’s why we went to Estonia: Moving to Estonia: Introducing Edgeryders Osaühing

Also, we are trying to hack the Estonian Osahüing (Limited Private Company) so that it is functionally equivalent to the British LBG.

Hi @alberto

Had you considered the commercial association?


It looked to me as though that while the company specifies a template for the constitution, the commerciial association may not, which would make it much more hackable…

I shall indeed be at the Brussels event and am participating in the funding workshop on Day Two.

Hi @alberto,

Indeed, in case of a universal takeover, where Edgeryders in Estonia would entirely replace Edgeryders in the UK, no amendment to opencare’s GA is required (the change is only to appear in the EU Beneficiary Register).

Before making any change, Edgeryders has to formally inform me (e-mail) of the request for a change and detail if it could significantly affect the project implementation/the EU’s financial interests.

Upon receiving Edgeryders formal announcement, I am indeed bound to inform the EU of the change. Usually, it is more of sharing information rather than asking for permission.

Although unlikely regarding our current situation, it may be possible that if the EU assumes that the change might delay the project implementation, they may ask for an amendment to our GA. I let you know of this potential outcome, as it is mentioned as such in the financial regulations for Horizon 2020.
I will keep you informed of the exchange I will have with Loretta.

Once the change due to universal takeover is processed, no additional information or maneuver is required from the coordinator or from the beneficiary. UBx will only need Edgeryders in Estonia address and bank info to proceed to the final payment and release fo guarantee fund after submitting the 2nd and the final reports for opencare (April-May 2018).

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Thanks, Luce. The email is in its way.