Pilatus denies wrongdoing over Saudi contract

Oscar Schwenk, as seen in an archive picture from 2013 (KEYSTONE/Salvatore Di Nolfi)

Swiss aircraft manufacturer Pilatus has rejected allegations that it did not properly inform the Swiss foreign affairs ministry about a deal to provide logistic support to the Saudi army.

In an interview published in the Zentralschweiz am Sonntag and the Ostschweiz am SonntagExternal link, chairman of the board of directors Oscar Schwenk said that the company had fully informed the authorities about the contract and had all the necessary permissions.

“Pilatus has done everything correctly,” Schwenk told the newspapers, in the company’s first comments on the affair.

On Friday the foreign affairs ministry confirmed that it was looking into the contract, after the story appeared in the media.

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In 2017 PilatusExternal link concluded maintenance contract for the fleet of PC-21 owned by the Saudi air force. The arrangement extended over five years and applied to the 55 planes stationed at Riyadh, the Pilatus annual report for 2017External link says.

The company is obliged to inform the foreign affairs ministry of such arrangements under the under the federal law on private security work undertaken abroad. The ministry only became aware of Pilatus’s activities in Saudi Arabia recently and “on the basis of its own research”, it said on Friday.

The details

Schwenk said that the company had a general export permit for Saudi Arabia from 2014 that is valid for four years. It permits Pilatus to sell aircraft to Saudi Arabia, provide support, update software or deliver technology related to maintenance, he explained. The support contract was a follow-on agreement to this.

Pilatus had contacted the foreign affairs ministry External linkand the State Secretariat for Economic Affairs (SECOExternal link) in 2015 to inform them of the firm’s business activities and export permits, he said. The maintenance contract was explicitly mentioned. The foreign affairs ministry indicated that deals already approved by SECO did not need further approval, Schwenk said. He has this in writing, he added.

Schwenk used the opportunity to criticise the approval procedure, which is divided between two separate departments. “In future it should all happen in one place, one department,” he said.

What the law says

The Federal Act on Private Security Services Provided AbroadExternal link, which came into force in 2015, obliges companies operating from Switzerland to declare private security service work abroad to the foreign affairs ministry.

Companies operating out of Switzerland are prohibited from engaging in any activities conducted for purposes of direct participation in hostilities abroad. Also banned is the provision of services which may lead to serious human rights violations. 

The controversy over Saudi Arabia arises from the fact that the country is involved in the civil war in Yemen.

Schwenk defended Pilatus’ business dealings with Saudi Arabia. It is clearly indicated what is allowed and not allowed, he said. In the interview, he also denounced the conflict in Yemen and the killing of a Saudi dissident, Jamal Khashoggi, in Turkey earlier this month.