MP revealed new details of the scandal involving procurement for the Armed Forces of Ukraine

MP revealed new details of the scandal involving procurement for the Armed Forces of Ukraine

The Polish company PHU Lechmar Sp.z.o.o., which failed in the delivery of shells worth 70.6 million euros, has received new offers for multi-billion procurement for the Ukrainian Armed Forces. How is this possible?

A recent scandal involving procurement for the Ukrainian Armed Forces totaling 23 billion hryvnias has attracted the attention of both MPs and the public. It concerns the transfer of some procurement functions from the Ministry of Defence to the State Border Guard Service. Member of Parliament Yaroslav Zheleznyak noted in his Facebook post that this decision raised many questions.

One of the central issues in this story was the cooperation with the Polish company PHU Lechmar Sp.z.o.o. This company had already been involved in contracts with the Defense Procurement Agency (DPA) in December 2023. At that time, a contract was signed for 70.6 million euros (approximately 3 billion hryvnias) for the supply of artillery shells. However, the company did not fulfill its obligations, and the deliveries did not occur.

Despite these risks, PHU Lechmar Sp.z.o.o. continued to send commercial offers. According to letters received from the Ministry of Defense, the company submitted four proposals over two years but failed to provide any response to a request to clarify product pricing for eight months.

Contracts with PHU Lechmar Sp.z.o.o.

According to documents attached to the MP’s post, in 2023-2024, the Defense Procurement Agency received four commercial proposals from PHU Lechmar Sp.z.o.o. for the supply of:

• 73 mm rounds with fragmentation grenade OG-9 (HE Steel Bomb);
• 155 mm M107 shells;
• 122 mm self-propelled howitzers 2S1 "Gvozdika";
• anti-tank grenade launchers RPG-7 MX2.

In 2024, PHU Lechmar was even considered one of the potential suppliers of weapons on the terms of 100% prepayment. This decision raises serious questions given the previous experience with this company.

As stated in the official response from the Agency, as of the end of 2024, 21 contracts were signed with PHU Lechmar, totaling 112.1 billion hryvnias. However, all these agreements pertain to the implementation of state programs in 2025-2026, which will require additional funding.

Moreover, the review revealed that the company did not provide information on its production capabilities. No inspections of warehouses or analysis of contract performance capabilities were conducted either.

Risks and Challenges

Despite the significant risks associated with PHU Lechmar, in 2024, Ukrainian officials considered transferring 23 billion hryvnias to the company. This was intended for contracts on terms of full prepayment.

As it turned out, the unreliability of this company was known as early as December 2023, when the then leadership of the DPA signed a contract with them for shell delivery. The contract worth 70.6 million euros was not executed, but due to a change in the Agency’s leadership, the funds were not paid to the company.

Another noteworthy fact is the months-long delay in responses from PHU Lechmar. According to the MP, the company failed to promptly clarify the pricing of its proposals, raising suspicions about its actual ability to fulfill orders.

Conclusions and Further Questions

The situation with procurements for the Ukrainian Armed Forces in cooperation with PHU Lechmar Sp.z.o.o. demonstrates how risky state contracts can be. The question of who stands behind this company and why its proposals remain in the spotlight of officials remains unanswered.

As Yaroslav Zheleznyak emphasized, this story requires not only parliamentary but also public investigation. It is crucial to explore which officials or business representatives are connected to PHU Lechmar. Such details can shed light on the reasons why Ukraine encountered such problematic procurements.