EU To Fine UK if Budget Bill is Not Paid

The U.K. could be handed a £42 million ($67 million) fine next month if it does not pay a £1.7 billion bill demanded by the European Union.

The EU said on Monday it will fine Britain if it refuses to pay a £1.7 billion bill demanded by Brussels by December 1. On Monday, a spokesman for the European Commission insisted the U.K. had to follow legal procedures and said the December 1 deadline was binding.

“Everybody has to pay what is due,” Margaritis Schinas, spokesman for the new commission chief Jean-Claude Juncker, said on Monday. “If fines are not paid by 1 December there is a process of interest being accumulated,”Schinas added, according to various media reports

The EU’s new budget spokesman, Jakub Adamowicz, is also reported to have warned that the U.K. would have to pay 2.5 percent interest on the debt if it is not paid in time, with the rate going up by 0.25 percent each month the debt remains. For the U.K., that would mean a £42.5 million fine if it does not pay in December and just over £90 million by the end of 2015.

via CNBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza