PARIS — French President François Hollande expects to decide in the coming weeks how to resolve a dispute with Russia over the two Mistral helicopter carriers, Agence France-Presse reported on Tuesday.
"We're looking at the contractual obligations," Hollande told a journalists association Monday evening. "We are in the discussions which are going on [with Russia] and which will naturally lead to a decision … which I will take in the next few weeks."   
Russia has asked for compensation of €1.163 billion (US $1.283 billion) for cancellation of the contract for the two warships, Reuters reported in May. France had offered a settlement of €785 million, according to Russian daily Kommersant, the news agency reported.
The interministerial committee for arms exports leads the review for the foreign sale of weapons. The committee is led by Louis Gautier, the secretary general for defense and national security. The Defense, Foreign and Economy ministries are represented on the committee.
DCNS, prime contractor for the two vessels, incurs a monthly cost of at least €1 million for maintaining the ships, Chairman Hervé Guillou said July 23, Reuters reported.
The naval company could seek recovery of the costs from Coface, the French export credit agency, after the governments decide on the dispute, Guillou said. 
The mistake was for France to sign the deal in the first place, notwithstanding the gains for the workforce, former Foreign Minister Hubert Vedrine said on France Inter radio.
There was a "certain irresponsibility" by the previous administration to sell the ships to Russia, leaving the present government to make the "regrettable but forced" decision to cancel the deal, he said.
Moscow may have legal rights but the Russians had done nothing to make a delivery "acceptable" when it came time to hand over the first ship, he said. France had "little choice" but to withhold the ships.
Then-President Nicolas Sarkozy authorized the controversial sale in 2011 in a deal worth €1.2 billion. The first ship, the Vladivostok, was due for handover last November, while the second, the Sevastopol, is scheduled for delivery later this year.
The Russian-backed crisis in Ukraine led Western and East European allies to urge France to cancel the Mistral deal.
Email: ptran@defensenews.com

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