Westinghouse appeals KHNP selection to Czech competition authority; ČEZ says challenge is improper

U.S. company Westinghouse Electric Company has appealed to the Office for the Protection of Competition (ÚOHS) against the selection of Korean company KHNP as the preferred supplier for the construction of new nuclear reactors at Dukovany. Westinghouse says the Koreans do not have licenses for the technology they offered. The company informed the Czech News Agency (ČTK) of this today. According to ČEZ, which is in charge of the tender, however, the Dukovany competition is covered by a security exemption, meaning bidders cannot challenge its proceedings before the antitrust authority. ČTK is seeking comment from KHNP.

The dispute between Westinghouse and the Koreans has been going on for a long time and is being addressed in international arbitration. The Americans have previously argued that KHNP is not entitled to use the reactor technology offered in Czechia. KHNP disagreed.

In July, the government decided to build two new nuclear reactors at Dukovany. They are to be built by Korean company KHNP, which won the tender in which the Czech government preferred it over French company EDF. ČEZ is now negotiating a contract with the Koreans, which should be signed by the end of March next year. The first of the new reactors at Dukovany is due to be completed in 2036. Westinghouse also took part in the tender initially, but the government did not invite it to the next phase of the competition at the beginning of the year. It said the company’s initial bid did not meet the requirements.

“As part of the tender, each bidder had to confirm that it had the right to transfer and sublicense the nuclear technology offered to ČEZ and local suppliers. KHNP’s proposed designs for its APR1000 and APR1400 reactor technologies use licensed technology from Westinghouse’s System 80 Generation II. KHNP does not own the underlying technology and has no right to sublicense it to a third party without Westinghouse’s consent,” the U.S. company said today.

It added that selecting KHNP would also mean moving tens of thousands of jobs from Czechia and the United States to Korea.

Westinghouse also reiterated that the dispute between the two companies over the technology would continue to be addressed through international arbitration. The U.S. company does not expect a decision before the second half of next year.

ČEZ, however, says Westinghouse’s appeal to the ÚOHS is improper. “The tender is being conducted under a security exemption, so a bidder cannot challenge the tender proceedings before the ÚOHS,” ČEZ spokesperson Ladislav Kříž told ČTK today.

In July, KHNP said it had a different view regarding the right to use the technology, while also declaring that it would comply with U.S. rules. After the tender results were announced, ČEZ said it had received confirmation from the Koreans that they owned the technology, as well as a contractual commitment to provide compensation if necessary.

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