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DEFENCE I OFFSET

Jarosław Kruk 

THE EUROPEAN COMMISSION AND THE POLISH OFFSET

05/02/2013

The European Commission has called on the Polish government to fully implement the Defence Directive. According to the Commission, the amendments to the public procurement law, which are entering into force, are insufficient, because Poland retains offset that is “naturally” at odds with the free market principles. It seems that the Commission ignores the fact that there is another European institution operating in Brussels – the European Defence Agency (EDA), and there is a thing known as the offset code, i.e. a developed practice in this area and the fact that the Directive itself does not mention the offset.

 In 2010, I had an opportunity to participate in the presentation of the position of the European Commission on the implementation of Directive Defence. The Commission explained the assembled representatives of the Member States that, although nothing in the Directive itself refers to the issue of offset, “overall it is bad” and should be eliminated, because … the Commission thinks so and this should suffice. When the chairman of the Polish delegation asked a question whether the Commission considers that there are no obstacles for the French Mistral-class warships intended for Russia to be built in the Polish shipyards and whether France is obliged to announce the European open tender for their construction, the French member of the Commission and the representative of the French Government expressed great consternation, just as a German delegate.

From the expression on their faces you could read: but the Poles are a stupid free market, of course, but the interest of our shipyards is the most important, it is also the matter of national security and stay away from this ... After such a lesson a lawyer may have some reflections. Firstly, what do we need those directives for, the Commission’s position that  would be binding on the Member States would suffice. But would there be a need to maintain this number of Eurobureaucrats then? Secondly, the concept of free market is different for the large ones and for the small ones. Our task is to warn them all, even overzealously. The large ones always have the national security issue up their sleeves in an expanding interpretation.

This issue has been resolved by the Scandinavian countries in an interesting way. There is no offset act there, they only have legislative acts which relate to voluntary industrial cooperation in the defense industry. A military equipment supplier is not obliged to conclude compensation agreements and to accede to them. It is up to his own will. But no one – who hasn’t offered offset – has ever won a tender, and probably he never will. Unfortunately, such a solution is possible with the effective and efficiently operating administration, and it is not a secret that the Polish administration, unfortunately, is not one of them.

 

 

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