Canada Allowed to Proceed with Frigate Contract as Trade Tribunal Reviews Protest

Canada will now be able to move forward with a planned contract award for 15 Type 26 frigates in early 2019 after the Canadian International Trade Tribunal reversed a decision to temporarily block the contract.

A team of Lockheed Martin Canada and BAE Systems were selected as the preferred bidder in the Canadian Surface Combatant program. Losing bidder Alion Canada, which was offering a ship based on the Dutch De Zeven Provincien Air Defense and Command frigate, subsequently filed a complaint with the CITT. At the time, the trade tribunal said it would review the complaint, and directed the government to postpone a contract award until the review was complete.

An artist rendering of a Type 26 frigate with Canadian markings
Type 26 rendering. Source: BAE Systems

That restriction has now been lifted, after an official from Public Services and Procurement Canada told the tribunal that a contract delay would be “contrary to the public interest.” Despite the reversal, the CITT said it will still review the complaint from Alion, a process that could take up to 90 days.

While the initial ruling from the CITT barred a contract award, it did not prevent negotiations between the government and the Lockheed team from continuing. As such, the complaint has not impacted the program schedule, and a contract is still anticipated in early 2019. A ruling from the CITT in favor of Alion could be disruptive, however, particularly if the ruling comes after a contract has been awarded.

About Shaun McDougall

Shaun McDougall is an analyst at Forecast International covering the U.S. and Canadian defense markets.

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