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Swiss company allegedly involved in Russian fighter jet deal
The federal intelligence service suspects that the Galika company in Zurich is concealing exports. They are supposed to serve Russia’s armaments. However, the Swiss authorities make several procedural errors in court.
Galika AG is based in the Volketswil ZH industrial park. There is also a dance, Burger King and a horticultural store. Galika, however, operates in a completely different league: the company exports machine tools to Russia and Eastern Europe.
In the documents that the company presented to the Secretary of State for the Economy, the deals sound harmless. A year ago he applied for two export permits to Russia: for a milling machine and for a Swiss-type lathe. It is said to be used to make parts for medical devices.
The Secretary of State obtained a statement from the Federal Intelligence Service. This advised against a permit. It assumes that the documents of the Russian receiving company are falsified. The devices are most likely not designed for medical use, but for military equipment.
According to the intelligence service analysis, the Russian company has not developed any new medical devices. Instead, it mainly operates arms production. Specifically, it manufactures sensors for Russia’s most important fighter jet project. All of this is kept secret in the documents.
Russian production of fighter jets is expected to stop
The intelligence service suspects that the Russians are having trouble making components for their new fighter jets. To do this, they now depend on new production machines.
The Galika company contradicted this in a statement to the Secretary of State. Its Russian business partner has a separate production hall for medical devices in addition to the armaments factory. The reason for this separation is that Russia pays specific subsidies to certain companies for the manufacture of medical devices.
After this exchange of correspondence, Galika submitted a third application. Now he plans to deliver a milling machine of the same type to another Russian company for a different purpose. Namely, to a toy company for the production of aluminum balloons.
The Swiss P-16 fighter jet project
This time, too, the federal intelligence service became suspicious. It assumes that the mill should now simply be handed over to the original company by detour. Various information in the contract, in the commercial register and on the website would not coincide.
The Secretary of State for the Economy rejected the three requests. It was based on international sanctions against Russia due to the conflict in Ukraine. He also referred to the Goods Control Law. He shared the assessment that the machines were intended for Russian weapons systems. Medical technology only serves as a pretext to disguise exports.
Authorities Fail Due to Procedural Errors
Galika challenged these decisions before the Federal Administrative Court. He accused the Swiss authorities of arbitrariness. The company has previously delivered many high-tech devices to the same Russian company. These were approved by the Secretary of State for the Economy, or at least they were not objected. The federal intelligence service is only making assumptions. There is no evidence. In addition, the company complains of several formal errors.
With the ruling of January 11, 2021, the company is now partially right. The Secretary of State for the Economy violated the company’s right to be heard because it could not comment on all the intelligence service reports. Furthermore, the Secretary of State simply took over the intelligence service information without clarifying the additional arguments of the company.
The Secretary of State must now reexamine the business and make new decisions. But then you could come up with the same result. The court holds that in the case of civil-military joint venture exports, it is normally not possible to prove purpose. A prevailing probability should suffice.
Daniel Buff, Chairman of the Board of Directors of Galika, does not want to comment on the ongoing proceedings when asked. However, he notes that his company is concerned about avoiding inconsistent approval practices by the Secretary of State. This is in the interest of the entire Swiss industry.
Galika was already in the headlines in 2019. At that time, Tamedia newspapers reported on arms deals to Venezuela, via Russia.
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