Malaysia seeks compensation after Norway revokes missile export license

Malaysia is facing a lengthy and difficult legal process to secure compensation following the cancellation of a contract for the Naval Strike Missile (NSM) system. The Norwegian government revoked the export license for the missiles in May, citing a policy to limit defense technology exports to allies and close partners. This decision disrupted a 2018 agreement intended to equip Malaysia’s six littoral combat ships.

Defense Minister Datuk Seri Mohamed Khaled Nordin stated that the Norwegian government has been uncooperative in resolving the matter, despite high-level requests made by Malaysia’s Prime Minister and Foreign Minister. Consequently, Malaysia must pursue claims directly against the supplier, Kongsberg Defence & Aerospace AS. The government is seeking over RM1 billion in compensation for direct and indirect losses, having already paid 95% of the original RM634 million procurement price.

To prevent naval assets from remaining without essential weaponry, Malaysia is considering new allocations of up to RM1 billion to procure alternative missile systems. The government is currently evaluating options from several countries, including Italy, Japan, France, Turkey, and South Korea.