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Russian Senator: Mistral Contract Breach May Cost France Billions in Fines

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Russia's Purchase of French Mistral-Class Warship (43)
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The deal for the delivery of Mistral-class helicopter carriers, signed by Russia and the French shipbuilder DCNS, allows for fines of several billion euros in the event of a contract breach, the Russian Federation Council's defense and security committee chairman Viktor Ozerov told RIA Novosti on Thursday.

MOSCOW, September 4 (RIA Novosti) - The deal for the delivery of Mistral-class helicopter carriers, signed by Russia and the French shipbuilder DCNS, allows for fines of several billion euros in the event of a contract breach, the Russian Federation Council's defense and security committee chairman Viktor Ozerov told RIA Novosti on Thursday.

“If we are talking about the possibility of a contract breach, Russia will use the money, returned for Mistrals, including the penalty payments, for fulfilling several positions in accordance with the state defense program, “ Ozerov said, commenting on the statement by French President Francois Hollande that the conditions under which Paris could authorize the delivery of the helicopter carriers are not in place.

Ozerov noted that the delivery has not been officially suspended, and that the statement reflects Hollande’s personal position.

According to Ozerov, there has not been any decisive expert judgment on whether Russia truly needed the carriers.

“Prior to signing this contract there has been a broad discussion among the Russian military on whether Russia needs such vessels,” Ozerov said, adding that it cannot be ruled out that the Russian Defense Ministry's former decision makers simply yielded to the persuasions of the French side.

On Wednesday, the office of President Francois Hollande released a statement saying that the head of the country concluded that the conditions under which France could authorize the delivery of the first helicopter carrier are not in place.

Russia and France signed a $1.6 billion deal for two Mistral-class ships in June 2011. The first of these, the Vladivostok, is due for delivery by the end of 2014, and the second, the Sevastopol, is expected to arrive in 2015.

In the end of July, DCNS said that the sanctions against Russia imposed by the United States and the European Union will not impact the delivery of the helicopter carriers to Russia.

Topic:
Russia's Purchase of French Mistral-Class Warship (43)
Tags:
deal, fines, Mistral, Francois Hollande, Viktor Ozerov, France
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