Link Securities | The Ministry of Defence has refused to apply the precautionary measures requested by Santa Bárbara Sistemas against the artillery contracts awarded to the joint venture between Indra and Escribano Mechanical & Engineering (EM&E) worth €7.24 billion. Santa Bárbara Sistemas, owned by the European subsidiary of General Dynamics (GD-US), filed an appeal on 22 January with the Subdirectorate for Armament and Material Procurement of the Ministry of Defence, requesting the annulment of the resolutions awarding the wheeled and tracked artillery contracts.
On the one hand, the amount of the award for the supply of the self-propelled wheeled artillery system is almost €2.686 billion and was pre-financed through 0% interest state loans of €1.181 billion. Meanwhile, the contract for the tracked artillery system amounts to €4.554 billion, with an interest-free public loan of €1.821 billion.
Although the Ministry of Defence has 90 days to resolve the appeal against the contracts (until 22 April), it was required to provide an initial response within one month. In the event of administrative silence, the requested precautionary measures would be deemed accepted; however, the response has been negative. Nevertheless, ‘the decision not to suspend the awards as a precautionary measure does not in any way prejudge the substantive examination of the appeal filed by Santa Bárbara Sistemas requesting the annulment of the awards,’ according to the Ministry of Defence’s resolution.
