Tribunal order delays navy warship contract

OTTAWA The $60-billion effort to build new warships for Canada’s navy is facing another delay after a trade tribunal ordered the federal government to postpone a final contract for the vessels’ design.

The federal government announced last month that U.S. defence giant Lockheed Martin beat out two rivals in the long and extremely sensitive competition to design replacements for the navy’s frigates and destroyers.

Lockheed’s design was based on a brand-new class of frigates for the British navy called the Type 26. The company is now negotiating a final contract with the government and Halifax-based Irving Shipbuilding, which will build the ships.

But one of the other two bidders, Alion Science and Technology of Virginia, has asked the Canadian International Trade Tribunal and the Federal Court to quash the government’s decision.

It says Lockheed’s design did not meet the navy’s stated requirements and should have been disqualified. Two of those requirements related to the ship’s speed, Alion alleged, while the third related to the number of crew berths

Late Tuesday, the tribunal released a one-page statement ordering the government to “postpone the awarding of any contract ... until the Tribunal determines the validity of the herein complaint.”

Alion has argued that the rules of the competition required the federal procurement department and Irving, which helped evaluate the bids, to reject Lockheed’s bid because of its non-compliance. Instead, they selected it as the preferred design.