Νόμοι — ΦΕΚ A' 207/2019

WHEREAS, Section C of the Implementation Agreement incorporated the revised contract 021B/02 between the HR (represented by the Ministry of National Defense), as Purchaser, and the HSY, as Contractor, for the execution of the NEPTUNE II program (the “NEPTUNE II Main Contract”); the scope of the NEPTUNE II Main Contract was materially modified due to a revised scope requested by HR focusing on the finalization of the modernization and general repair of the class 209 submarine named “OKEANOS” and on the construction of 2 new class-214 submarines, instead of the mid-life modernization and general repair of 3 old/used class-209 Submarines of the HN.

WHEREAS, HSY, as Contractor, and TKMS, as Main Sub-contractor, entered into a subcontract dated 22 October 2010 concerning finalization of the mid-life modernization and general repair of the class 209 submarine named “OKEANOS” and the construction of two new class 214 submarines by way of using materials, services and know-how to be provided by TKMS (the “NEPTUNE II Sub-Contract”).

WHEREAS, pursuant to Article 5.9 of the NEPTUNE II Main Contract, HSY undertook to transfer to the HR upon the effective date of the Implementation Agreement (the “EDCA”) the title of ownership in the materials set out in Annex E of Section C of the Implementation Agreement, which were produced or procured prior to EDCA for the contemplated modernization and repair of two submarines class 209 of HN and have become idle due to the modification of the scope of the NEPTUNE II Main Contract (the “Excess Materials”) and the HR undertook to pay to HSY an amount of 117.000.000 euros (the “Excess Materials Price”).

WHEREAS, pursuant to Article 5.10 of the NEPTUNE II Sub-Contract, TKMS undertook, in consideration of a total amount of 117.000.000 euros, to transfer to HSY upon EDCA the title of ownership in the materials set out in Annex Q2 (being identical with Annex E of Section C of the Implementation Agreement) in order to enable HSY to perform its respective obligations vis-à-vis HR under Article 5.9 of the NEPTUNE II Main Contract.

WHEREAS, according to Article 6 of the NEPTUNE II Main Contract the Excess Materials Price was payable by HR to HSY in five instalments as follows: 97.000.000 euros upon EDCA, and the remaining balance of 20.000.000 euros in 4 successive instalments of EUR 5.000.000 each, due on 15 February, 15 May, 15 August and 15 November 2011. The same amounts were on a back-to-back basis payable by HSY to TKMS on the same payment dates, in discharge of the corresponding payment obligations of HSY to TKMS under Articles 6.1.2, 6.1.3.3.1, 6.1.3.4.1, 6.1.3.5.1 and 6.1.3.6.1, respectively of the NEPTUNE II Sub-Contract. EUR 115.000.000, out of which 97.000.000 euros corresponded to the first installment of the Excess Materials Price, in accordance with article 6.2.2.1 of Section “C” of the IA.

WHEREAS, on 15 February 2011 HR paid to HSY an amount of EUR 5.000.000 in discharge for the first installment of the Excess Material Price payable under Article 6.2.2.2.3.1 of the NEPTUNE II Main Contract. This amount was not forwarded to TKMS under Article 5.10 of the NEPTUNE II Sub-Contract (both payments referred to in paras 10 and 11 herein together referred to as the “Excess Material Payments”).

WHEREAS, an amount of EUR 15.000.000 corresponding to the unpaid balance due by HR of the Excess Materials Price is still outstanding (the “Excess Material Balance”).

WHEREAS, the delivery of the entirety of the Excess Materials was not effected as envisaged in article 5.9 of the NEPTUNE II Main Contract.

WHEREAS, on 10 February 2014, TKMS received via fax, the Assessment Act Ɂʉ. F.604.4/1441 S.323 dated 29 January 2014, issued by the Minister of National Defense (General Directorate of Defense Armaments and Investments, Directorate for Defense Programs and Main Contracts) (the "TKMS Assessment Act"), by virtue of which the repayment of the EDCA Payment of EUR 115.000.000 was unilaterally assessed («ʃɲʏɲʄʉɶʀʍɽnʃɸ» in the original Greek text) against TKMS (the “Disputed EDCA Payment”).

WHEREAS, TKMS sought the annulment of the TKMS Assessment Act by filing (a) before the Greek Court of Auditors the appeal under folio number 203/29.4.2014 (the “TKMS Appeal”), and (b) before the Council of State the Application for Annulment under the folio number 1923/9.5.2014 (the “Application for Annulment”).

WHEREAS, on 31 January 2014, HSY was served with the Assessment Act No. F604.4/1443/S.325 dated 29 January 2014, issued by the Minister of National Defense (General Directorate of Defense Armaments and Investments, Directorate for Defense Programs and Main Contracts) (the "HSY Assessment Act"), by virtue of which the amount of EUR 115.500.000 (“HSY Disputed Assessment”) was unilaterally assessed against HSY on the grounds mentioned therein. Out of the amount of the aforementioned HSY Disputed Assessment, an amount of EUR 5.000.000 corresponds to the Excess Materials envisaged in Annex E of Contract 021B/02.

WHEREAS, HSY sought the annulment of the HSY Assessment Act by filing before the Greek Court of Auditors the appeal under folio number 156/27.03.2014 (the “HSY Appeal”).

WHEREAS, HSY, along with three (3) other parties, initiated ICC proceedings (Case No. 18675/GZ/MHM/AGF/ZF/AYZ) against the HR, and a corresponding Final Award was delivered on 29 September 2017 (the “Final Award”). By virtue of the Final Award, HR was ordered to pay to HSY the Excess Material Balance on the condition of the simultaneous delivery of the Excess Materials to HR. The Hellenic Republic filed an application for the annulment of the Final Award before the Court of Appeal of Athens,

WHEREAS, HR initiated on 23 April 2014 arbitration proceedings against HSY, TKMS and five other parties and such arbitration proceedings are still pending (the “ICC Case 20215/AGF/ZF”).

WHEREAS, TKMS, in the context of ICC Case 20215/AGF/ZF, filed a Counterclaim against the HR on 3 March 2015 seeking declaratory relief to the effect that the Disputed EDCA Payment of EUR 115.000.000 was paid by the HR to TMKS for good and valid reason and that TKMS is entitled to retain such amount (the “Counterclaim”).

WHEREAS, the TKMS Appeal, the Application for Annulment, the Counterclaim as well as the HSY Appeal are all still pending (the “Pending Proceedings”).

WHEREAS, the Excess Materials have not been delivered in their entirety to the HR.

WHEREAS, by virtue of article 26 of Law 4258/2014 the HN was granted access to the facilities and equipment of HSY for the purpose of completing the works for the Submarines under construction “PIPINOS”, “MATROZOS” “KATSONIS” of ARCHIMEDES Program and “OKEANOS” of NEPTUNE II Program.

WHEREAS, the HR set up a Negotiations Committee with the companies HSY and TKMS for the formulation of a draft settlement agreement on the delivery of the Excess Materials to the HR.

WHEREAS, a group of HN experts has already inspected the Excess Materials stored and located at the premises of TKMS in Germany as well as those stored and located at the premises of HSY in Greece.

WHEREAS, the Parties wish to finally resolve the issue of Excess Materials along with all claims and disputes between them arising out or in relation of the sale and delivery of the Excess Materials. NOW THEREFORE, in consideration of the premises and mutual covenants herein set forth and in order to avoid long-lasting court and arbitral proceedings, the Parties hereby have agreed to settle the disputes related to the the Excess Materials Price, the Excess Materials Payments, the Excess Material Balance, the Disputed EDCA Payment, the TKMS Assessment Act, the HSY Assessment Act and the delivery of the Excess Materials, (the “Settled Claims”), and they mutually agree, covenant and accept the following:

IDENTIFICATION OF EXCESS MATERIALS 1.1. The Parties agree and acknowledge that the Excess Materials to be delivered by HSY and TKMS to the HR pursuant to the provisions hereof, are those listed in the detailed list (which includes all the identification details of the materials, namely technical description, NSN where available, Part Nr. and manufacturers’ codes), attached hereto as “Annex 1”, which constitutes an integral part hereof and supersedes and replaces the Annex E of Section C of the Implementation Agreement. 1.2. The Parties acknowledge and accept that the full ownership of the Excess Materials has already been transferred to the HR upon EDCA pursuant to Article 5.9.1 of the NEPTUNE Main Contract.

EXCESS MATERIALS PRICE 2.1. The value of the Excess Materials amounts to EUR 117.255.386,79 2.2. TKMS has received in consideration for the Excess Materials the amount of EUR 97.000.000 and the HR has paid to HSY EUR 5.000.000 in accordance to Article 6.2.2.2.3.1 of the NEPTUNE II Main Contract. The Parties agree that together these amounts (EUR 102.000.000) constitute the Excess Materials Price (hereinafter the “Revised Excess Materials Price”). 2.3. The Parties acknowledge that the Revised Excess Materials Price has been already paid in full by the HR, in the manner described in the Preamble hereof, in paras 10 and 11. 2.4 The HR hereby irrevocably and unconditionally acknowledges that the Disputed EDCA Payment which forms the subject matter of the TKMS Assessment Act was lawfully paid to TKMS in accordance with article 6(c) of Section F of the Implementation Agreement and that TKMS is entitled to lawfully retain such payment. 2.5. Upon EDC of this Agreement the TKMS Assessment Act shall be automatically repealed and shall cease to have any legal effect. 2.6. The HR hereby irrevocably and unconditionally acknowledges that the HSY Assessment Act against HSY has been reduced to the amount of EUR 110.500.000 resulting from the difference of the total amount of EUR 115.500.000 less the amount of EUR 5.000.000 that was legally paid to HSY, as per article 6.2.2.2.3.1. of the NEPTUNE II Main Contract. The Parties reserve their right to undertake any action they deem appropriate with regards to the remaining amount of the HSY Assessment Act. 2.7. TKMS waives its right to receive from HSY any additional amount in consideration for the Excess Materials including an amount equal to the Excess Material Balance in accordance with Article 5.10 of the NEPTUNE II Subcontract and HSY waives their corresponding right to receive from the HR the Excess Material Balance in accordance to Article 6 paragraphs 2.2.2.4.1, 2.2.2.5.1 and 2.2.2.6.1 of the NEPTUNE II Main Contract. 2.8. The Parties acknowledge that the sales invoices issued in 2010 and 2011 by TKMS to HSY and by HSY to the HR with respect to the Excess Materials are fully valid. 2.9. The amount of EUR 5.000.000 already paid by the HR to HSY, which forms part of the Revised Excess Materials Price, shall not be refunded. (a) the initialled draft of the present Agreement shall be ratified by the Greek Parliament by means of a relevant legislation (the “Ratification”); (b) the initialled and ratified draft of this Settlement Agreement shall be executed by the authorised representatives of the Parties within 7 (seven) days from the date of Ratification and shall enter into force on the date that the Ratification has duly taken place (the “Effective Date” or “EDC”).

PERFORMANCE OF THE AGREEMENT Following the Effective Date the Parties shall pursue to the following actions: 4.1 Delivery of the Excess Materials 4.1.1 Within one month as of the Effective Date, the HR shall set up a Delivery Committee for the Excess Materials and shall notify HSY and TKMS of the members of this Delivery Committee. 4.1.2 Within the same deadline, HSY and TKMS shall designate their legal representatives who will be responsible for the delivery of the Excess Materials. 4.1.3 The Excess Materials ( including the shipment and delivery of the Excess Materials located at the premises of TKMS in Germany, as identified in Annex 1 to the premises of HSY), shall be delivered within one month from the setting up of the Delivery Committee of the HR and the designation of the legal representatives of HSY and TKMS. 4.1.4.The Excessive Materials shall be delivered in their current “as is” condition and in compliance with their technical description in Annex 1 and their delivery shall be executed in the premises of HSY, in the presence of the legal representatives, designated for this purpose, of HSY and TKMS. 4.1.5 The Committee on the Delivery of the Excess Materials shall receive the Excess Materials and a Protocol on Delivery & Acceptance shall be executed for that purpose, which will be signed by all Parties. Any materials missing shall be recorded by the Delivery Committee of HR in the Protocol on Delivery & Acceptance. For the avoidance of any doubt, TKMS shall have no responsibility whatsoever in relation to the delivery of Excess Materials stored and located at the premises of HSY. TKMS shall be solely responsible for the replacement of any missing Excess Materials to be shipped from Germany. 4.1.6 The transfer of the Excess Materials from the premises of HSY to premises of the Hellenic Navy must be completed prior to the termination of the term of the Special Administration. HSY and the HR agree that the continuing storage of the Excess Materials in the premises of HSY is at the risk of the HN and that HSY shall bear no liability whatsoever in relation to the storage of the Excess Materials as long as these are stored in the premises of HSY. Materials, which had been delivered by TKMS to HSY prior to the EDCA in 2010 in the context of the works for the modernization of the 209 Class Submarines under the initial scope of the NEPTUNE II Submarine Program. The parties acknowledge and agree that the HN shall take delivery of those materials in “as is” condition and at its own risk and cost and without the interference of HSY and/or TKMS. The parties waive any claims past, present or future, whether based on negligence, contract or intent and irrespective of their legal basis – which they have or may have (and whether known or unknown), directly or indirectly, in relation to the materials contained in Annex 2.

NOTICES All correspondence, notices and other documents delivered under this Settlement Agreement shall be in the English language or, if not, accompanied by a translation in Greek certified to be accurate; the receiving Party shall be entitled, to assume the accuracy of and rely upon the Greek translation of any document so provided pursuant hereto. Any correspondence among the Parties in connection hereof, shall be addressed as follows: Hellenic Republic: Ministry of Defense, Mesogeion Avenue 227-231, 15451 Athens Greece, and attn.: […]. TKMS: thyssenkrupp Marine Systems GmbH, Hermann-Blohm-Straße 3, 20457 Hamburgand attn: Dr Michael Götz HSY: Palaska street, Skaramangkas Athens, Greece, and attn.: Special Administrator.

GENERAL PROVISIONS 8.1. The Parties are contracting hereto as independent parties and shall under no circumstances undertake any joint liability or be held liable respectively. None of the Parties shall take over any obligation hereunder unless explicitly attributed to such Party. None of the Parties shall be authorized to represent one of the others. 8.2. This Settlement Agreement and any rights and obligations hereunder may not be assigned and transferred, in whole or in part, without the prior written consent of the other Parties hereto. 8.3. Any amendment, supplementation or suspension of this Settlement Agreement, including this provision, shall be valid only if agreed in writing and ratified by law. 8.4. If any provision of this Settlement Agreement should be or become wholly or partially void, ineffective or unenforceable, the validity, effectiveness and enforceability of the other provisions of this Settlement Agreement shall not be affected thereby. Any such void, ineffective or unenforceable provision shall be deemed replaced with effect ex tunc by such valid, effective and enforceable provision as comes closest to the economic intent and purpose of the void, ineffective or unenforceable provision as regards subject-matter, extent, time, place and scope. The same shall apply with respect to gaps in the Settlement Agreement. is exempted from any tax, including any withholding tax, V.A.T, stamp duty, contribution, duty, registration duty, levy or fee, either in favor of any governmental authority or of any third party It is explicitly stipulated that HSY may lawfully book now in its 2019 accounts the invoice issued in 2010 by TKMS with respect to the Excess Materials and the relating cost will be recognised for corporate tax deductibility purposes as a cost incurred within 2019. It is explicitly confirmed that the supply and delivery of the Excess Materials falls under the scope of the VAT exemption provided in Article 27 par. 1(a) of law 2859/2000 given that they are meant to be incorporated and/or used on board warships.

APPLICABLE LAW & ARBITRATION 9.1. This Settlement Agreement shall be governed and construed in accordance with Greek Law. 9.2. All disputes arising out or in connection with this Settlement Agreement shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce (ICC). The arbitral tribunal shall consist of three arbitrators appointed in accordance with the said Rules. The seat of the arbitration shall be Athens. The language of the arbitral proceedings shall be English. On behalf of On behalf of On behalf of the Hellenic Republic TKMS HSY