Ship's computer system at heart of Navy frigate deal issue

MANILA, Philippines — The Philippine Navy's frigate acquisition project is now at the center of controversy after allegations that Special Assistant to the President Christopher "Bong" Go intervened on behalf of a South Korean firm surfaced, a charge the president's aide and the Department of National Defense denied.

One of the most significant issues is the choice for the combat management system that the frigates, being acquired by the Navy, will use. The CMS acts as the brain of a ship as it integrates its weapons, sensors, communication and navigation systems.

In a privilege speech on Monday, Rep. Gary Alejano (Magdalo) questioned why Malacañang would get involved in the modernization project and stressed that the relief of former Navy chief Ronald Joseph Mercado would not have happened without the nod of the presidential palace.

Alejano also questioned why the Navy had to explain to Go why it chose Thales Tacticos despite the "lobby" for South Korea's Hanwha Sytems.

"Why should the Navy explain to Sec. Bong Go (special assistant to the president) why Thales Tacticos was chosen despite the lobby for Hanwha Systems? Does Sec. Bong Go know the technical specifications and needs of the Navy more than it which did thorough research on the frigate?" Alejano said.

Alejano said that Hyundai Heavy Industries, which won the multi-billion contract to supply the Navy with frigates, offered the military the combat management systems of Naval Shield of Hanwha Thales of South Korea and the Thales Tacticos of Netherlands.

The Magdalo lawmaker said that the Navy chose Thales Tacticos of Netherlands because it had the better and more advanced system used by almost two dozen navies in the world.

According to Alejano, Thales Tacticos is used by 23 navies around the world and is installed on around 172 ships while Hanwha's system is employed only by the South Korean Navy. The South Korean firm's ongoing contract with the Malaysian Navy is only for training purposes, he said.

The CMS of Thales Tacticos is also compatible with TDL 16, which is a Command, Control, Communications, Computer, Information/Intelligence, Surveillance, Targeting Acquisition and Reconnaissance requirement of the Armed Forces, according to Alejano. The South Korean firm's TDL 16, however, is still under development and could be available by 2019, he said.

Alejano said that TDL 16 would provide the military a faster means of communicating real-time information than traditional voice communications.

He also said that another advantage of Thales was its service support around the world while that of Hanwha was only in South Korea.

Thales also has the largest systems integrator in the world, he said, while Hanwha's integration experience is assisted by the South Korean government and other non-Korean companies.

In terms of experience, Thales has 60 years of company experience while Hanwha has only 15 to 20 experience in joint venture with Thales.

Aside from the issue on CMS, Alejano also wondered how HHI won the contract in the first place.

He said that Hyundai, whose bid amounted to P15.745 billion, won despite the lower proposal by Garden Rearch Shipbuilders and Engineers of India. GRSE's bid amounted to P15.074 billion, P700 million lower than that of the South Korean firm's.

Alejano alleged that the Indian firm was disqualified due to non-compliance with the net financial contracting capacity requirement despite its being a government company of India and covered by sovereign funds.

"It is puzzling that a government company backed up by sovereign funds failed in this aspect," he said.

According to Go, he did not have any information or knowledge of the procurement of the CMS of the Navy ships and stressed that he did not intervene in the acquisition process, a statement reinforced by the Department of National Defense.

On Wednesday, he offered to resign if it would be proven that he dipped his hands in the AFP's modernization efforts.

The DND also labeled the anomalies cited by Alejano as "mere allegations and innuendos" which were not legal grounds for the termination of the project under the Government Procurement Reform Act.

"[T]here are specific conditions that must be present in order to invoke it, none of which are existing at the moment in this project," the defense department said in a statement.