BREAKING NEWS – According to several sources, the German Bundeswehr has apparently, and unexpectedly, cancelled its order for approximately 120,000 Haenel MK556 ‘machine carbines’ (assault rifles) that was placed less than a month ago.

Readers familiar with the saga of the Bundeswehr’s search for a new rifle to replace the Heckler & Koch G36 in frontline service, will know that the entire project has been mired in controversy, delays, technicality issues, and price concerns from the start. Heckler & Koch even won a lawsuit against the German government, albeit on a technicality, concerning the alleged performance issues with the G36 that led to the search for a replacement in the first place.

It’s probably safe to assume from that recent history around the G36 that HK was on the backfoot a bit going into the bid process, and apparently the company was told by the German government more or less upfront that the HK416 was too expensive for consideration. So HK rapidly developed the HK433 as a lower cost option, spent considerable effort into reducing the manufacturing cost of the HK416, and saw both rifles make it into the final round of testing and evaluation. The first round of T&E, as you may remember, failed to produce a winner because the Bundeswehr reported that none of the entries had met actually met their strict technical, performance, and price criteria.

In the end, it was the HK416 and HK433 vs. the Haenel MK556 (which is basically the UAE-produced Caracal CAR-816 carbine, manufactured in Germany). Last month the German government surprised a lot of people by selecting the Haenel / Caracal rifle over the two HK options. The decision was apparently driven mostly by price, and was immediately controversial for several reasons. Firstly, many people questioned whether a small firm like Haenel would even be able to scale up their production capability sufficiently to meet the quantity and quality required by the Bundeswehr. That led in turn to speculation that at least some of the production would have to be undertaken in the UAE – which would raise a number of legal, political, and social red flags. Lastly, and unsurprisingly, HK announced the day after the decision was released that they would be challenging the decision and undertaking a thorough legal review of the process as well. Further to that last point, many people observed that the CAR-816 / MK556 is basically a lower-cost clone of the HK416, so there would naturally be questions patent infringement and so on.

 

We have now learned from an article published by BusinessInsider.de on October 6 that Heckler & Koch did in fact submit a 320-page document to the German government outlining in detail the nature of and reasons for their protest of the decision to proceed with the Haenel rifle. Chief among HK’s complaints were that the test procedures and results were unreliable and very possibly incorrect (they also appear to have implied in-built bias against HK as well). HK also contested that Haenel does not have the capability and capacity to actually produce the rifles as needed, as well as the very serious assertion that Haenel was illegally offering their rifles at an artificially low price in order to win the contract at any cost. This point is particularly relevant as it has now come to light in a leaked report from the Bundeswehr Procurement Office, that the offered price was really the ultimate deciding factor that overrode all other considerations, but even that difference was not actually as great as was first reported.

However, as we noted above, the MK556 / CAR-816 is allegedly essentially a lower-cost clone of the HK416, and HK appears to have also pointed out several technical features of the Haenel rifle which infringe upon their design and patents. This point is in fact specifically called out in an article published today by the Frankfurter Allgemeine newspaper and is given by the Bundeswehr Procurement Office as the main reason for now cancelling the awarding of the contract for new rifles to Haenel.

According to the Frankfurter Allgemeine article:

At the registry office, it is now said, “for the first time verifiable”, they have learned of a possible violation of patent rights. In the bidding process, each supplier had to declare in writing that his product was free of rights and claims by third parties.

The internal audit showed, according to the briefing of the supervisors, that such an infringement to the detriment of the competitor Heckler & Koch “cannot be ruled out”. If that were the case, Haenel would have obtained the order for around 120,000 new assault rifles for the German armed forces with unfair means.

Therefore, the contracting authority is now forced to cancel the award of the contract to CG Haenel. The registry will enter into a re-evaluation. This also seems necessary because Heckler & Koch also complained about irregularities in the technical inspection of the weapons submitted. With the cancellation of the award decision, Haenel is not yet out of the running, provided the company can prove that it manufactured its weapon, called MK556, without infringing any patent rights.

Should Haenel / Caracal be able to defend their rifle against HK’s claims of patent infringement, there is also the allegation that Haenel engaged in price dumping to be investigated, and finally there is also political opposition to a Haenel / Caracal decision to be dealt with. As has been reported today, members of the opposition parties in Germany have expressed concern and disapproval over awarding a Bundeswehr contract to a company that is owned to a large extent by a foreign state which is heavily involved in the Saudi-led “dirty” war in Yemen.

So perhaps there is hope for the HK433 (seen above) yet. At the very least, much like a Wagnerian production, this opera ain’t over until the Fat Lady sings – and her part is still being written…