2. ‹#›
“Offsets are compensations agreed upon between the
State and the supplier of the defense material, susceptible of
contributing towards the industrial development of the
Portuguese economy and the resulting economic value
increase associated to the purchase.”
(Decree-Law nº 154/2006, 7th August, Art.º 1º, nº 1,
Wherein the Offsets Legal System is defined)
OFFSETS CONCEPT
3. ‹#›
Type of Offsets:
Direct Offsets– refer to goods and services directly
related to the purchased equipment (ex. local co-production
of weaponry system parts which is being acquired);
Indirect Offsets– refer to military or civil goods and
services unrelated with the purchased equipment – they may
include IDE, technology transfer, marketing opening and
other activities of confirmed added value for the industry.
OFFSETS CONCEPT
4. ‹#›
Groups of Offsets (Decree-Law nº 154/2006, 7th August, Art. 5):
GROUP I - Direct Offsets - those connected to the
purchasing object;
GROUP II - Indirect Offsets – those connected to the
Defence Industry (corresponding to collaboration and/or
participation in activities within the scope of the Defence
Industry);
GROUP III – Indirect Offsets not connected to Defence.
OFFSETS CONCEPT
5. ‹#›
OFFSETS NEW MODEL
OFFSETS GOALS (Decree-Law nº 154/2006, 7th August, Art. 1, nº. 2
and 3):
Lead to the development of competitive entrepreneurial
abilities within international markets;
Contribute to the creation of entrepreneurial abilities within
the defence industries’ sector, aiming at the national
participation in the chain value associated to the systems or
equipment to be purchased, or to the creation of national
abilities linked to the sustainability of these systems or
equipments life cycle.
6. ‹#›
OFFSETS NEW MODEL
GOALS (cont.):
To optimize the industrial fabric capacities and to maximize
the national added value production;
To promote high technology activities development with a
strong involvement in the I&D+I areas, in order to be able to
produce national added value on a sustainable basis;
To reinforce double-use technologies investment and
maximizing the Defense Sector potential technological
dissemination;
To promote adequate partnerships between national and
foreign partners;
To reinforce stronger and more dynamic networks between
the BTID actors and the Armed Forces branches.
7. ‹#›
OFFSETS NEW MODEL
GOALS (cont.):
To ensure the SME’s access to the Defense Systems and
Equipments large manufacturers suppliers networks;
To evolve into a logic set on the industrial participation in
products and services development co-operative projects to
be purchased, as a way to include the Portuguese
companies into the international projects value chains and
to generate synergies for the industrial consolidation
process;
To ensure industrial scale economies;
To develop clusters in centers of excellence.
8. ‹#›
OFFSETS NEW MODEL
Offsets Scope (Decree-Law nº 154/2006, 7th August, Art. 2, nº.
1):
Purchase of Defense material, in values not lower
than 10 Million Euros.
Offsets Value (Decree-Law nº 154/2006, 7th August, Art. 6, nº.
1):
Value at least equal to the purchase value.
9. ‹#›
OFFSETS NEW MODEL
KIND OF OFFSETS PROJECTS (Decree-Law nº 154/2006, 7th
August, Art. 21, nº.1)
Foreign direct investment;
Technology transfer aiming at increasing the Portuguese
companies competitive capability;
Partnerships aiming at including the Portuguese companies , in
a sustainable manner, into the global market;
Ongoing partnerships using the national companies’ and other
entities abilities, namely in I&D;
Goods and services exports and other purchases from national
companies;
Goods supply and services rendering to national companies.
10. ‹#›
OFFSETS NEW MODEL
FACTORS TO BE CONSIDERED IN THE
ASSESSMENT OF PROPOSALS (Decree-Law nº 154/2006, 7th
August, Art. 24, nº. 2):
The structuring effect and its sustainability;
The level of technology involved and the respective degree of
innovation;
The industrial technology usage perspective;
The investment involved;
The direct or indirect creation of qualified employment;
The national technological development impact and its
contribution to the products or procedures innovation
processes;
The industrial specialization and the reinforcement impact in
terms of markets internationalization and diversification.
11. ‹#›
OFFSETS NEW MODEL
Commission payments for the participation in
offsets or industrial cooperation programs (Decree-
Law nº 153/2006, 7th August, Art. 17, nº. 2):
Established by the CPC Chairman, according to the regimen
to be ruled by joint order;
Applicable upon new projects or ongoing project programs,
subject to restructuring.
Spread of offsets benefits (Decree-Lei nº 154/2006, 7th August,
Art.º 25º, nº 3):
For projects of over 10 M€, the beneficiary shall be compelled
to subcontract, at least, 15% of the total amount to be
granted.
12. ‹#›
CPC RESPONSIBILITY FOR PNACE MEASURES
Measure 40: Optimization of the offsets processes
associated to public purchases (included in the Competitiveness
and Entrepreneurship Policy);
Measure 55: Allocate at least 20% of the large public
purchase counterpart values to I&D and innovation projects and
at least 1% of the Military Programming Law annual
appropriations (included in the Research, Development and
Innovation Policy).
13. ‹#›
CPC RESPONSIBILITY FOR PT MEASURES
Measure 3-013: Elaboration and implementation of a
stimulating aeronautical industry program as from the offsets
programs;
Measure 3-029: Stimulate the Offsets Market;
Measure 3-072: Stimulating and managing of the offsets
processes by expert teams;
Measure 3-073: Define strategic investment areas for
Portugal and to define adequate technologies for those areas;
Measure 3-105: Definition of a multipliers table.
14. ‹#›
EXAMPLES OF OFFSETS PROJECTS
Helicopters EH 101 purchasing Program:
EH 101 back fuselage manufacture - OGMA (Group I);
Technology transfer + rear ramp production for NH 90 –
OGMA (Group II);
Motorcars components (plastic) manufacture for Group
GKN – Irmãos Bernardes (Group III).
15. ‹#›
EXAMPLES OF OFFSETS’ PROJECTS
Submarine Purchasing Program:
Subcontracting – submarine batteries production -
Autosil (Group I);
Satellite navigation systems development - Edisoft
(Group II);
Orders, co-operation, subcontracting – energy +
electronics – EFACEC (Group III).
16. ‹#›
EXAMPLES OF OFFSETS PROJECTS
Aircrafts C-295 Purchasing Program:
Design and implementation of a Drawing and
Engineering Cabinet - OGMA (Group I);
Aircrafts C 130, P 3 and PUMA maintenance
subcontracting, - OGMA (Group II);
Co-operation between EADS CASA and the Nova Base
Consulting (Group III).
17. ‹#›
EXAMPLES OF OFFSETS PROJECTS
Torpedoes Purchasing Program:
Integration of torpedoes battle systems – EDISOFT
(Group I);
Access to new markets in the development of
software within the Defense and Space sectors –
Critical Software (Group II);
Access to new markets within the sector of electrical
components for energy systems - EFACEC (Group III).
18. ‹#›
EXAMPLES OF OFFSETS PROJECTS
Wheeled Armored Vehicles Purchasing
Program (WAV):
Production of WAVs’ for the Portuguese Program –
FABREQUIPA (Ex-GOM) (Group I);
Software developed for the Defense sector – Critical
Software (Group II);
Exporting of components for the motorcar sector –
door panels –ACECIA Group (Group III).
19. ‹#›
EXAMPLES OF OFFSETS PROJECTS
F-16 Targeting Pods Purchasing Program:
Type 1 — National capacity development reinforcement, integration
and electronics systems’ testing
1.1 — Projects, preferentially associated to direct offsets (Group I), guided towards the
strengthening of national entities development abilities reinforcement to integrate
electronic systems;
The latter should be associated to the development of the interconnecting systems de
between the Targeting Pod and the F-16, as well as to create the ability in Portugal, in
order to support the Air Force in exploiting (ex. introducing changes to the TP resulting
from modifications performed into the TP interconnection with the aircraft) and the
sustainability of the system’s operation;
1.2 — Projects guided towards the reinforcement of the national capacities namely in the
filed of essays and tests, on land and on board, compatible with electromagnetic and
electronic systems;
1.3 — Reinforcement of national skills regarding the development, tests and
radiofrequency identification systems usage (RFID), with a set of applications
encompassing from the luggage identification for the commercial transports up to the
allies and enemies identification on the battle filed (IFF).
20. ‹#›
EXAMPLES OF OFFSETS PROJECTS
F-16 Targeting Pods Purchasing Program:
Type 2 — Reinforcement of national skills associated to the purchase,
automatic processing and data availability, for the purpose of creating
a national Center of Excellence in this field
Projects guided to the reinforcement national skills in terms of purchasing, automatic
processing and data availability leading to the establishment in Portugal of a Center of
Excellence for data processing. This center shall have the capacity to support
surveillance activities, reconnaissance and monitoring, from land, maritime, air and
spatial platforms from several national entities related to applications such as:
a) Forest fires detection and monitoring;
b) Costal surveillance;
c) Maritime patrolling;
d) Reconnaissance; or
e) Targets’ purchasing;
Ideally, the skills developed shall allow to establish a number of services based on the
acquired export knowledge;
21. ‹#›
EXAMPLES OF OFFSETS PROJECTS
F-16 Targeting Pods Purchasing Program:
Type 3 — Reinforcement of national capacities within the training and
simulation areas
Projects oriented to the training and simulation system’s development, on board or not,
leveraged on the already existent skills in Portugal and focused on its efforts;
Type 4 — Other projects associated to the Command and Control,
Communications, Computers, Intelligence, Surveillance, Target
Acquisition and Reconnaissance fields (C4ISTAR), if their pertinence and
impact on the industrial national development within the scope of this project are dully
justified.
