GERMAN NAVAL YARDS KIEL files a complaint against the MKS180 decision

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Public procurement law expert demands exclusion of Damen shipyard – Kiel-based company will go to the public procurement chamber if necessary.

The Kiel shipyard GERMAN NAVAL YARDS (GNYK) has challenged the decision of the Federal Ministry of Defence to award the MKS 180 multi-purpose combat ship to Damen. As announced by the company’s management on Monday, a formal complaint was sent to the responsible Federal Office for Equipment, Information Technology and Utilization of the German Armed Forces (BAAINBw) on 24 January 2020. The company would definitely file an application for review with the Federal Public Procurement Chamber if the BAAINBw does not uphold the complaint, it was further stated. If the Public Procurement Chamber does not grant the application for review, the company will next file an appeal with the Düsseldorf Higher Regional Court.

A few days ago, the Ministry of Defence announced that it wanted to award the largest contract in the history of the German Navy to the Dutch shipyard Damen. Dr. Roland M. Stein, the public procurement law expert entrusted by GNYK with the review proceedings, emphasized on Monday that the alleged reasons for the exclusion of his client could not be justified. “GERMAN NAVAL YARDS is to be excluded because the company is said to have failed to meet less than 0.15 percent of the requirements. We have thoroughly examined the alleged reasons – none justify an exclusion from the proceedings,” said Stein, who is a partner at the renowned Berlin law firm Blomstein.

He added: “We have also demanded the exclusion of the Dutch shipyard Damen from the procedure.” There were considerable and well-founded doubts as to whether Damen’s bid was in line with key aspects of the tender. This concerns issues such as the drive system, which are already being discussed in the press. In addition, according to Stein, many other aspects – some of which are even safety related – are problematic.

The decision of the Ministry of Defence was preceded by a complex tendering process lasting several years. The MKS 180 is the largest and, with a volume of more than five billion euros, the most expensive procurement project in the history of the German Navy. Initially, four ships of this type are to be built. The GNYK shipyard in Kiel was the last remaining German general contractor in this contract competition.

GNYK had already been illegally excluded by the Ministry of Defence when the contract to build the K 130 corvettes (2nd batch) for the German Navy was awarded in 2016. However, the shipyard successfully won a share in the 1.5 billion project in court. “The exclusion in the MKS 180 tender is, even if for other reasons, just as illegal as the K130 procedure at that time,” said attorney Stein on Monday.