The Armament Agency – changes to military purchases system from 1 January 2022

On 1 January 2022, the Armament Agency became the central authority responsible for purchases of weapons and military equipment. The Agency took over and consolidated the competences of several other organizational units of the Ministry of National Defence operating so far.

The system of acquiring military equipment for the Polish Armed Forces is based on a fairly complex set of regulations of different legal status and the resulting procedures. Their primary objective is to secure the overriding goal, which is the purchase by Poland of modern equipment for the army, which will significantly strengthen the country’s defence potential.

The Armament Agency, established on 1 September 2021, from 1 January 2022 became the central body of the entire system, linking it into one body.

The Armament Agency – an institutional revolution

On 1 September 2021, the Ministry of National Defence published in the Official Journal of the Ministry of National Defence a package of five decisions^[1] regarding the acquisition of weapons and military equipment. Most of these decisions took effect on 1 January 2022, with an exception of Decision No. 117/MON, which entered into force on 1 September 2021 (while the provisions on the Armament Agency entered into force along with other decisions).

The key legislative act around which the new system is created is Decision 116/MON, which replaced Decision 141/MON of 5 July 2017 on the system of acquisition, operation and decommissioning of military equipment of the Polish Armed Forces^[2]. 

This legislative act introduced a “new” entity, the Armament Agency, to the military procurement system. Initially, speculation continued over whether the Agency would replace the existing organizational units of the Ministry of National Defence responsible for the purchasing policy, or whether it would act alongside them. Doubts in this respect were dispelled by Regulation No. 74/MON^[3]. Pursuant to §1 of this Regulation, the Armaments Inspectorate changed its name into the Armament Agency as of 1 January 2022. By this Regulation, Minister of Defence also enacted the statutes of the Armament Agency.

The Armament Agency is a budgetary unit of the Ministry of National Defence responsible for:

• implementation of tasks related to market analysis in search of opportunities to acquire military equipment and services for the Polish Armed Forces and implementation of the process of their acquisition;
• implementation of tasks in the field of research and development works aimed at increasing the level of operational capabilities of the Polish Armed Forces;
• implementation of projects related to the acquisition and management of intellectual property rights for the needs of the Polish Armed Forces;
• implementation of the Ministry of National Defence tasks in the field of offset agreements;
• concluding public procurement contracts and supervising them, as well as supervising the offset agreements.

Thus, the Armament Agency will continue the mission of the Armaments Inspectorate, but has also taken over the competences of other organizational units of the Ministry of National Defence, such as the Inspectorate for the Implementation of Innovative Defence Technologies (I3TO) and the Offset Agreements Bureau, which were disbanded as of 31 December 2021.

The assumption of the Ministry of National Defence was to organize and simplify the procedure of acquiring military equipment by concentrating competences and responsibility for the entire process in one unit. The establishment of the Armament Agency, announced by the Minister since 2018, was supposed to be a remedy for the existing system, in which, due to a multitude of units with often overlapping competences (the management of the Ministry of National Defence, the General Staff of the Polish Armed Forces, the Armaments Inspectorate, the Armament Policy Department, I3TO, Offset Agreements Bureau, organizers of functional systems, weapon system administrators, central logistic authorities, etc.) the responsibility was blurred and decision-making processes stretched endlessly and were drowning in the overgrown bureaucratic procedures.

Transforming the system anew

The idea of simplifying and organizing the process of acquiring military equipment motivating the management of the Ministry of National Defence was reflected in Decision No. 116/MON of 1 September 2021. This decision explicitly defines and legitimizes a decisive (superior) role of the Minister of National Defence in the entire process of acquiring military equipment. The Minister is to supervise the entire process, issue decisions on acquisition of equipment. He may also suspend or discontinue the acquisition of equipment, order to redefine the equipment requirements or to prepare a feasibility study. The Minister of National Defence also accepts the proposals for Poland’s participation in international development programs in the field of technology and supervises their implementation.

Under the new system of acquiring military equipment, the Head of the Armament Agency is responsible for the substance of the process, and he also:

• defines the equipment requirements;
• implements the process of acquiring military equipment (prepares and conducts procurement procedures and concludes contracts);
• implements the guidelines of the Minister of National Defence in the field of cybersecurity;
• oversees research and development work;
• determines the method of introducing changes to technical documentation for military equipment obtained in the process of development works.

Decision No. 116/MON describes in detail the procedure to be followed when acquiring new military equipment and when acquiring military equipment as part of an urgent operational need, and also the mode of conducting development works, or the procedure related to the American FMF (Foreign Military Financing) aid program.

Moreover, pursuant to Decision No. 117/MON, the Technical Modernization Council was established, chaired by the Minister of National Defence. The Council consists of representatives of the Chief of the General Staff of the Polish Armed Forces, the Armament Agency, the Armament Policy Department, the Strategy and Defence Planning Department and the Budget Department, appointed by the Minister.

The tasks of the Technical Modernization Council, which acts as an advisory body to the Minister of National Defence, include, among other things:

• adopting the position on matters relating to technical modernization of the Armed Forces
• initiating the process of defining equipment requirements and approving them;
• initiating urgent operational needs;
• developing opinions, assessments and conclusions on matters related to the process of acquisition of military equipment.

Procedures

Decision No. 116/MON defines two basic procedures for the acquisition of new armaments or other equipment for the Armed Forces:

• procurement of new military equipment,
• procurement of military equipment for urgent operational needs.

The first of these procedures can be considered as standard while the latter is an accelerated path.

In the first case, the procedure is initiated by formulating equipment requirements by task groups composed of representatives of the Armament Agency, Chief of the General Staff of the Polish Armed Forces and other units of the Ministry of National Defence. Equipment requirements, which constitute a set of requirements for tactical and technical parameters of the prospective military equipment, may be developed on the basis of preliminary market consultations announced via the Agency’s website or under a procurement procedure in the competitive dialogue formula.

Equipment requirements formulated by task groups operating under the leadership of the Head of the Armament Agency are subject to approval by the Technical Modernization Council.

An alternative procedure is the procedure for procuring military equipment as part of an urgent operational need, which is initiated by an appropriate application submitted by the Chief of the General Staff of the Polish Armed Forces, Service Branch Commander (currently General Commander of the Armed Forces Branches, Operational Commander of the Armed Forces Branches and the Commander of the Territorial Defence Forces).

The applicant should define a specific operational need, provide justification and define, among other things, appropriate military equipment or define the expected tactical and technical parameters, indicate products existing on the market that meet the above parameters or define the scope of necessary adaptation or modification of the existing solutions. The Head of the Armament Agency prepares an estimated cost of acquisition of the military equipment and a time-cost analysis for the application. The application is subject to approval by the Minister of National Defence.

The next stage of the procedure is the process of purchasing military equipment, which will be described in detail in the articles that will follow.

Development works and FMS

Apart from acquisition of military equipment, Decision No. 116 / MON provides for development works procedure, the general purpose of which is to develop technical documentation enabling the production and purchase of newly developed (or modified) military equipment.

The works are carried out on the basis of the equipment requirements approved by the Technical Modernization Council and include two stages:

• defining assumptions for design of military equipment, within which the critical parameters are determined;
• design and development (creating a preliminary design and technical design).

Also in this process, Decision No. 116/MON provides for an important role for the Head of the Armament Agency. First of all, just like when acquiring military equipment, he manages the formulation of equipment requirements. In addition, the Armament Agency carries out the first stage of development works, i.e. the stage of defining the design assumptions and develops (and approves) the evaluation of the conceptual design and tactical and technical assumptions.

In the second stage – design and development – the Armament Agency prepares an assessment of the preliminary design and the assessment of technical design and, if necessary, verifies and modifies the tactical and technical assumptions accordingly. It also approves the program of qualification tests of prototypes and issues decisions on conducting qualification tests. The representative of the Agency also chairs the Qualification Testing Committee which oversees this testing stage. After successful completion of tests, the Head of the Agency accepts the technical documentation.

Pursuant to §66 of Decision No. 116 / MON, the Head of the Armament Agency is equipped with control and supervisory competences as well as with regard to the acceptance and assessment of development stages. He may also appoint a development work manager or a standing committee for its implementation and supervision.

As regards the procedures for procurement of military equipment from aid funds under the FMF program and in accordance with the FMS (Foreign Military Sales) procedure, the Head of the Armament Agency, at the request of the competent Service Branch Commander approved by the Technical Modernization Council, initiates the equipment procedure under the above procedure. He also has the right to agree with the competent institutions the final configuration of the subject of the contract.

Evaluation of the introduced changes

From 1 January 2022, the Armament Agency and its Head appointed by the Minister of National Defence is the central link that binds the entire system of acquisition of military equipment by the Polish Armed Forces. The new organizational unit of the Ministry of National Defence has concentrated the existing competences of the Armaments Inspectorate, I3TO, Offset Agreements Bureau and some of the competences of the Military Centre for Standardization, Quality and Codification.

On the one hand, indeed, this may result, as assumed, in simplifying and reducing bureaucracy of long and complicated processes of acquiring military equipment, which sometimes lasted for years, but the current shape of the regulations potentially creates some risk. Since the competences of all the above-mentioned units have been concentrated in the hands of the Head of the Armament Agency, who is a direct subordinate of the Minister of Defence, we cannot rule out that without an appropriate control system, decisions regarding purchases or development works will sometimes be taken without the necessary consultations with weapon system administrators, future end-users, and will be subordinated to the short-term goals of the ministry’s policy.

Will it be so? Time will tell.

This article is the first in a series of articles guiding through the intricacies of the Polish system of purchasing military equipment. The series was conceived as a guide for traders considering participation in ongoing or planned procurement procedures as well as persons and bodies taking important decisions from the point of view of national defence.

Author:

See also: Disqualification of a judge

Piotr Dudek
Director of the New Technologies Department, Defence & Aerospace
TGC Corporate Lawyers

Aviation law and defence – see how we can help:

• [1] Decision No. 116/MON of the Minister of National Defence on the acquisition of military equipment (Official Journal of the Ministry of National Defence, item 188)
• Decision No. 117/MON of the Minister of National Defence concerning the Technical Modernization Council (Official Journal of the Ministry of National Defence, item 189)
• Decision No. 118/MON of the Minister of National Defence laying down rules governing the development and implementation of central acquisition and investment plans (Official Journal of the Ministry of National Defence, item 190)
• Decision No. 119/MON of the Minister of National Defence repealing the decision determining the functions of administrators and central logistic authorities of military equipment in the Ministry of National Defence and on division of tasks resulting from the repealed decision (Official Journal of the Ministry of National Defence, item 191)
• [2] Decision No. 141/MON of the Minister of National Defence on the system of procurement, operation and decommissioning of military equipment of the Polish Armed Forces (Official Journal of the Ministry of National Defence, item 149)
• [3] Regulation No. 74/MON of the Minister of National Defence of 1 December 2021 concerning the Armaments Agency (Official Journal of the Ministry of National Defence, item 252)