A360
Key Takeaways✦ Atlas AI
01
Malaysia is demanding $251 million from Kongsberg after Norway's export permit revocation halted missile system delivery, impacting Malaysia's naval modernization program.
02
The claim includes direct costs for the undelivered missile systems and significant indirect costs for removing and replacing integrated components on naval vessels.
03
This incident highlights stricter Norwegian defense export policies, now prioritizing sales to allies, potentially affecting future defense procurements for non-allied nations.
Atlas AI
Malaysia is seeking $251 million in compensation from Kongsberg Defense & Aerospace AS following Norway's revocation of an export permit. This action prevented the delivery of Naval Strike Missile (NSM) systems and launcher components for Malaysia's littoral combat ships.
The claim includes 126 million euros ($146 million) in direct costs already paid for the missile systems. Additionally, Malaysia is seeking substantial indirect costs, bringing the total claim to approximately 1 billion ringgit ($251 million).
Kongsberg Defense
Indirect costs encompass the removal of previously installed missile mounting systems and the integration of replacement systems on naval vessels. The original agreement for the NSM anti-ship missile system was signed in 2018 as part of Malaysia's naval modernization program.
Norway's Foreign Ministry indicated that oversight of sensitive defense technology sales has been strengthened, restricting them to allies and close partners. Malaysia's government has formally issued a notice of demand to Kongsberg regarding the cancellation.
