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Mistral deal cancellation may cost France up to €5 billion — reports

May 14, 2015, 11:21 UTC+3 PARIS
According to the report, now the French and Russian sides "have significant differences in regard to compensational payments" in case of the non-performance of the contract
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© EPA/EDDY LEMAISTRE

PARIS, May 14. /TASS/. The cancellation of a deal on delivering Mistral-class helicopter carriers to Russia may cost France some €2 or €5 billion, the French weekly Le Point reported on Thursday.

"Instead of bringing the French shipyards corporation DCNS the profit of €1.2 billion and its contractors some €890 million, the cancellation of the deal may cost France approximately €2-5 billion due to non-performance of the contract," the report says.

According to the report, now the French and Russian sides "have significant differences in regard to compensational payments" in case of the non-performance of the contract. "France is trying to return Russia the sum less than €890 million that has already been paid earlier," it says.

On May 16, the period of force majeure circumstances that allowed a temporary delay in the handover ends and Russia will get the full right to demand compensations for the non-performance of the contract, the report says.

Under the contract, Russia was expected to receive the first of the two warships, the Vladivostok, in the autumn of 2014. However, Paris suspended the ship’s handover to Russia at the very last moment over Moscow’s stance on developments in neighboring Ukraine.

It was planned that the second ship dubbed the Sevastopol would be handed over to Russia in the second half of 2015. But the deal was suspended like in the case with the first Mistral ship.

Infographics Mistral helicopter carrier Mistral helicopter carrier
Russia will purchase Mistral-class helicopter carriers from France. Infographics by TASS

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