Australia’s Submarine Program: A Failure in Anti-Corruption Due Diligence?

Australia is embarking on a naval building program, the largest undertaken since the Second World War. A significant aspect of that building program is the replacement of the current Collins class submarines, known as the Future Submarine Program (or Project SEA1000). The estimated cost of building 12 new diesel electric submarines is $50 billion, not including the combat system.

On 20 February 2015, the Australian Government announced that a competitive evaluation process (CEP) would be undertaken involving design concepts submitted by 3 submarine manufacturers namely; Direction de Constructions Navales Services (DCNS) of France; ThyssenKrupp Marine Systems GmbH (TKMS) of Germany and Mitsubishi of Japan. On 26 April 2016, the Australian Government announced that DCNS had been selected as the preferred partner to build the submarines.

DCNS is now known as the Naval Group. It was previously DCN. Since 1997, DCNS has been involved in 5 major corruption scandals. Three of these events were known before the company was selected to design Australia’s submarines and two have come to notice since it was selected. Four of the incidents involve the supply of submarines or frigates to Taiwan, Pakistan, Malaysia and Brazil and the loss of information pertaining to the submarines the company is building in India. DCNS has denied any wrongdoing, but too many incidents have occurred to be ignored, and further information should be sought by the Australian Government about them and appropriate anti-corruption measures applied. But have they?