In common with last year's edition, this year's edition will also include a fairly comprehensive description of the part played by offset transactions. Offset agreements form an important part of the overall process of defence procurement and a description of the offset process will therefore contribute to a proper understanding and appreciation of the Armed Forces' most important procurement projects. This year's edition will be structured in the same way as last year in that it will focus on summaries of the new contracts concluded during the reporting year and on how the procurement picture has developed over the last few years. The summaries of the major contracts show the total contract sum exclusive of VAT and duty while the summaries of the principal suppliers are based on the overall payments made to individual suppliers in 1997. All the figures in the tables and charts are rounded to the nearest million NOK unless otherwise stated

Procedure for defence equipment contracts

All enquiries and contracts are prepared and negotiated by the Materiel Commands. If the contract sum is expected to exceed NOK 50 million, MOD approval is required for the project. Ministry approval, on the basis of advice from Headquarters Defence Command, is also required for the tender enquiries and for the contract itself. Headquarters Defence Command has delegated authority to approve all projects, enquiries and contracts involving less than NOK 50 million but is obliged to inform the MOD of any procurements which Headquarters Defence Command consider to be of particular interest to the Ministry even though the cost involved is below the NOK million threshold.

All defence procurement is subject to the legal provisions of the "Regulations Concerning Government Procurements etc.", itself based on the principles of the EEA agreement in relation to open competition and non-discrimination with regard to potential bidders. Procurement of classified equipment, or materiel which is essential to national security, is however exempt from the provisions of the EEA agreement. The set of regulations "Provisions Concerning Procurements for the Armed Forces" (BAF) are central to the defence procurement process. These regulations form part of the national regulatory framework and are intended to ensure that defence purchases are, to the greatest possible extent, based on fair competition while still ensuring that the requirements of Armed Forces are met with materiel of the right quality supplied at the right time.