On November 24, the first preliminary hearing was held regarding corruption and sanctions violations allegations against Dutch shipbuilder Damen Shipyards. The company is suspected of circumventing European sanctions against Russia following the 2022 Russia-Ukraine conflict, and of obtaining new ship orders through bribery, document forgery, and money laundering between 2006 and 2017.
The Dutch Public Prosecution Service (OM) has now filed criminal charges against Damen Shipyards and its current director along with two former directors. This marks the first time a major European defense contractor has been prosecuted for sanctions evasion. Should corruption charges be upheld, the consequences would be severe: Damen Shipyards would be barred from government contracts for at least four years. As it is currently building warships for the Netherlands and other NATO nations, Damen Shipyards is designated by the Dutch government as a “strategically important national enterprise.”
Michiel Zwinkels, Chief Public Prosecutor, told the media:” the case is unique. The Dutch government feels the company is of ‘national strategic importance’ as it builds naval vessels for the Netherlands and other NATO countries. Zwinkels: ‘This adds more tension and puts more pressure on such a case. But when a company that is important to the Dutch defence industry is suspected of circumventing sanctions against Russia, it may be even more important to bring this before the court.”
OM disclosed that following the escalation of the Russia-Ukraine conflict, Damen Shipyards violated EU sanctions by exporting ship components to Russia. It is alleged that Damen Shipyards falsified export declaration documents for deck cranes submitted to customs at least 14 times in 2022 to conceal the fact that the goods were destined for Russia. OM contend that this involved “goods and technology that could potentially bolster Russia’s military capabilities and defense sector development,” constituting a violation of the sanctions.
In the Netherlands, intentionally violating sanctions or export controls is a criminal offense. If a judge deems the standard fine of over €1 million too low, a fine of 10% of a company’s annual revenue can be imposed. According to financial reports submitted to the Dutch Chamber of Commerce, Damen Shipyards’ revenue exceeded €3 billion in both 2023 and 2024. A criminal conviction can also disqualify a company from bidding on European contracts.
Moreover, Damen Shipyards is simultaneously facing corruption allegations. Dutch prosecutors allege that between 2006 and January 2017, certain new ship orders secured by Damen Shipyards involved dishonest transactions—specifically, concealing the true source of funds through means such as bribery, document forgery, or money laundering.
Moreover, Damen Shipyards is simultaneously facing corruption allegations. OM believes that between 2006 and January 2017, certain new ship orders at Damen Shipyards involved potentially dishonest transactions—specifically, concealing the true source of funds through means such as bribery, document forgery, or money laundering.
In 2016, the World Bank barred Damen Shipyards from participating in its projects for 18 months, citing fraudulent conduct involving the concealment of intermediary agencies and commission structures within the West Africa Regional Fisheries Program. In 2017, local media reported that Dutch tax investigators raided Damen Shipyards’ headquarters to probe allegations of overseas corruption.
In response to Dutch media reports about the trial, Damen Shipyards issued a statement confirming that the company had been subject to an OM investigation concerning activities between 2006 and 2016. The eight-year investigation culminated in formal charges, with the core allegations centering on document falsification across multiple projects. During the period covered by the allegations, Damen Shipyards undertook approximately 1,500 complex shipbuilding projects worldwide.
Damman Shipyards confirmed the first preliminary hearing scheduled for November 24 through an official announcement, expressing deep regret over the eight-year investigation period and anticipating protracted legal proceedings. The company stated it is confident in the outcome of the litigation and will use this opportunity to refute the Dutch prosecution’s “unfounded” allegations.
The corruption case and the sanctions violation case are two entirely separate matters. Once substantive hearings commence, Damen Shipyards will mount a comprehensive defense for both cases in court rather than in the media.
Damman Shipbuilding also noted that the company has established robust compliance procedures and employs a dedicated team to conduct thorough reviews of every contract submitted by agents and clients. The effectiveness of this compliance framework has received external recognition, as Damman Shipbuilding has obtained the highest international standard certification for integrity and anti-corruption (ISO).