GUIDELINES FOR THE ESTABLISHMENT AND IMPLEMENTATION OF OFFSET IN CONNECTION WITH DEFENCE PROCUREMENTS ABROAD

6.1 Overriding objectives

The term offset refers to transactions which compensate fully or in part for defence procurement from abroad. Offset agreements are to contribute to strengthening and maintaining the technical capability, capacity and marketing position of the Norwegian defence industry. This strengthening should preferably relate to areas of direct interest to the Norwegian Armed Forces. Offset agreements also aim to contribute to increasing the level of expertise, new technology, and marketing opportunities of Norwegian industry in general. Priority will be given to enhancing the development of Norwegian industry in specific areas in which Norway has particular competence and potential for success in the international market. Offset agreements will aim to contribute as far as possible to the permanent enhancement of the future prospects for Norwegian industry.

6.2 Strategy

Offset agreements are to be framed with the following priorities in mind:

• The purchase of Norwegian defence products, preferably weapon systems, subsystems, weapons and weapon components
• The purchase of high-technology products and services.

Norwegian defence products are here taken to mean defence-related products for which the added value is created by a company in Norway.

Offset arrangements involving the purchase of Norwegian defence products require extensive contact between the defence authorities and defence industries in two countries. It is the responsibility of the supplier to establish contacts both with Norwegian industry and with the defence authorities in the suppliers own country in order to identify areas in which Norwegian industry's particular expertise matches any of the supplying country's defence needs. The purchase of Norwegian defence products will involve the defence authorities and defence companies in both countries. It is the responsibility of the foreign supplier to ensure that offset arrangements are realised.

All offset transactions should relate primarily to areas in which Norway participates in international collaboration in the field of defence equipment and technology. Areas of particular interest in this context include:

• Hardware and software for communications and command, control and information systems
• Radio, satellite and line communications
• Electro-optical (optronic) systems
• Fire control systems
• Missile technology
• Ammunition and military explosives
• Submarine technology and sonar systems
• High speed vessel technology
• Space technology.

6.3 Organisation

An advisory group has been established for offset. Members of the Offset Group include the Ministry of Defence (Chairman), the Ministry of Trade and Industry, the Norwegian Defence Research Establishment, HQ Defence Command Norway and the Confederation of Norwegian Business and Industry/Norwegian Defence Industry Group. The Ministry of Defence carries out the secretarial function. In individual cases the group may call on outside expertise.

The Offset Group has the following mandate:

«The Offset Group is able to provide assessments and advice both in matters of general offset policy and in particular cases. The group is to base its work on the Ministry of Defence´s guidelines for the establishment and implementation of offset in connection with defence procurements abroad.»

The Offset Group reports to the Contact Group for International Materiel Cooperation. The Contact Group is an advisory body for the Ministry of Defence. It is chaired by the Head of MOD's Department of Defence Resources. The Contact Group consists of representatives from the Ministry of Defence, HQ Defence Command Norway, the Norwegian Defence Research Establishment, the Ministry of Industry and the Confederation of Norwegian Business and Industry/Norwegian Defence Industry Group. Representatives of other organisations may be invited as necessary.