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Analysis: European defense contracts

By LEANDER SCHAERLAECKENS, UPI Correspondent
Published: May 16, 2008 at 10:15 PM
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BRUSSELS, May 16 (UPI) -- Patria could lose Slovenian deal to bribery charges

An ongoing investigation by the Finnish police could lead to Finnish firm Patria losing a contract it won with the Slovenian government worth about $400 million, which made it the largest Slovenian defense contract in history, a Slovenian news channel reports. The contract was signed in December 2006, and the terms called for 135 armored vehicles to be delivered between this year and 2013.

Slovenian Defense Minister Karl Erjavec confirmed that the contract most likely would be void if any tampering in the bidding process was discovered. A clause in the contract states that Patria isn't to give out presents or cash to those involved in the tender. A breach of that clause leads to an automatic cancellation of the contract.

The Finnish police have arrested two people suspected of bribing officials in Egypt and Slovenia while representing Patria.

Yet voiding the contract would present Slovenia with a problem, as its NATO membership, granted four years ago, requires that it holds, among other things, the armored vehicles in question.

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