Norway cited National Security for blocking the sale to of Bergen Engines to Russia
TDS News – In a royal decree issued on Friday 26 March, the government of Norway has ordered that Rolls Royce stop the sale of Norwegian company Bergen Engines AS to companies within the Transmash Holding Group.
Additionally, a block has been placed of any transfer of shares, assets, property, industrial or technological information or other rights held by Bergen Engines or the company’s subsidiaries to Transmash Holding Group (TMH).
This decision is pursuant to the provisions of the Act of 1 June 2018 no. 24 concerning National Security as set out in Section 2-5, paragraph one. The royal decree grants the Minister of Foreign Affairs the authority to make the decision that any export of goods or technology by Bergen Engines or the company’s subsidiaries to Russia where the end user is in Russia or to other actors domiciled in Russia must be subject to prior approval from the Norwegian Ministry of Foreign Affairs.
On 18 March, the government concluded that it had sufficient information to hand to determine that the sale of Bergen Engines to TMH needed to blocked. This is to ensure that the interest of national security are not threatened.
‘We believe that it is wholly necessary to prevent the sale of this company to a company controlled from a country that we do not have a security partnership in place with,’ says Monica Mæland, Minister of Justice and Public Security.
‘This has been a challenging case, but we have engaged in positive dialogue with Rolls Royce throughout this matter,’ Mæland adds.
The most important elements in the government’s assessment of whether to block the sale are:
- That the technology in Bergen Engines’s possession and the engines that they manufacture would be of great military strategic significance for Russia, and that it would strengthen Russia’s military capability in a way that is in clear contravention of Norway’s security policy interests, as well as the policy interests of Norway’s allies.
- Although these products and technologies are not subject to the export controls in place, Russia has faced significant challenges in gaining access to these since the imposition of tough sanctions against the country in 2014.
- The planned acquisition may have resulted in attempts to circumvent export control regulations or our own restrictive measures directed at Russia in order to gain access by underhand means to knowledge and technology of great military strategic significance to Russia.
- The export of technology and engines to Russia would have been in contravention of Norway’s security policy interests, as well as the policy interests of Norway’s allies.