The 1st Public Procurement Tribunal of the Federal German Cartel Authorities (Bundeskarttelamt) has decided that the annulment of the award procedure for the procurement of a Heavy Transport Helicopter (STH) by the Bundeswehr is effective. Accordingly, the award procedure with the two bidders Lockheed Martin and Boeing does not have to be continued, although the annulment decision is unlawful. The unlawfulness was justified by the Procurement Tribunal on the basis of the estimate of the procurement costs, which could not be explained comprehensibly.
The award procedure commenced in February 2019 and was cancelled by the German Armed Forces in September 2020 because the bid prices were significantly higher than the budget allocated as part of the federal budget. Lockheed Martin had objected to this decision and subsequently applied for a review before the Procurement Tribunal.
If Lockheed Martin appeals against the decision of the tribunal, the Düsseldorf Higher Regional Court would be the next instance. In the meantime, the Bundeswehr is preparing an alternative procurement route. Price enquiries will be used to determine the costs for direct procurement from a manufacturer and then possibly the purchase will be carried out according to an FMS procedure.
In the case of complex defence material such as the STH, the life cycle costs are assessed to be about the same as the mere procurement costs. In the previous award procedure, life cycle costs were covered for 30 years.