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Airbus Contemplating Legal Suit Against Germany’s Arms Ban To Saudi Arabia; Reports


05/06/2019


Airbus Contemplating Legal Suit Against Germany’s Arms Ban To Saudi Arabia; Reports
The German government is likely to be sued by the European aircraft manufacturer Airbus over the decision of the German government to put a freeze on exports of arms to the Kingdom of Saudi Arabia. According to reports quoting sources, this decision would impair Airbus from completing a border security system for the Gulf country.
 
The murder of Saudi journalist Jamal Khashoggi inside the Saudi consulate in the Turkish capital Istanbul had prompted Germany to reject all future arms exports licenses to Saudi Arabia back in October. Germany, the largest economy of Europe, also put a freeze on deliveries of already approved equipment. It had been reported earlier that this decision of Germany had not gone down well with its allies and defense firms engaged in or looking to do business Saudi Arabia.
 
Its commitment for setting up of the security system for the border between Saudi Arabia and Yemen would be the issue that would be put forward by Airbus in its planned legal suit against Germany, reports said. The contract for the security system is worth a total of about 3 billion euros ($3.36 billion), and about 1 billion euros worth of work still remains open, claimed reports quoting sources.
 
“We are looking at an action for failure to act,” said a report published by Reuters quoting a source familiar with the matter who spoke to the news agency on condition of anonymity. “We want to force the federal government to decide now.”
 
There have been no comments available from Airbus over the issue.
 
On its part, the German government has refrained from making any comments over issues relating to possible corporate compensation claims originating because of its decision to ban arms exports to Saudi Arabia until any materialize.
 
The reports however did not mention anything about the place or time of the filing of the lawsuit.
 
Its ban on exports of arms to Saudi Arabia was extended by Germany in late March to be applicable till the end of September. Some exceptions opt the ban were however also announced.
 
Radars, drones and command posts for guards are included in the border system for Saudi Arabia.
 
“We are not talking about an offensive weapon here, but about a border security system,” said reports quoting sources.
 
According to reports, the reason that is driving Airbus to take legal action against Germany is its obligation towards the shareholders because the company has had to make risk provisions of 300 million euros because of the possible non-completion of the security system contract for Saudi Arabia because of the German ban. Reports also said that the company wants to show its customers and suppliers that it is ready to go to any extent legally possible to comply to the order.
 
There were reports in February this year that in order to circumvent the Germany’s freeze on arms exports to Saudi Arabia, Airbus had decided to remove German components that it used in the C295 military transport aircraft it builds in Spain and redesign the craft.
 
(Source:www.reuters.com)


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