Toronto’s eagerly awaited $92 million electric ferries, contracted by a shipbuilder, are entangled in a legal web involving forgery and alleged sanctions breaches in the Netherlands, recently disclosed by Dutch prosecutors and a city spokesperson.
The Netherlands Public Prosecution Service has leveled charges against international shipbuilder Damen for bribery, forgery, and money laundering, focusing on activities dating back to 2006 until January 2017. Prosecutors claim that substantial commission payments to agents posed a risk of them bribing local officials.
The company is also under scrutiny for potential violations of sanctions related to goods and technology that could enhance Russia’s military and security sector, as per a Dutch announcement.
Damen’s spokesperson clarified that a distinct legal matter pertains to the delivery of ship cranes to the Russian fishing industry in early 2022, with discussions ongoing regarding compliance with EU sanctions at that time. The charges against Damen were initially reported by the Toronto Star.
The forgery case could impact future tenders, according to Middel, pending Damen’s final conviction following legal proceedings. However, the company asserts that the City of Toronto’s ferry program is unaffected, emphasizing their commitment to compliance standards since 2014.
Damen is scheduled for a pre-trial hearing in Zwolle, Netherlands, on November 24.
The city was unaware of the charges until recently, with electric ferries worth $92 million expected for delivery in 2026 and 2027 after construction at Damen Shipyards Galati in Romania.
The legal case against Damen involves alleged high commission payments to agents involved in ship sales across Africa, Asia, and South America, creating a risk of bribery in those regions. Prosecutors suspect the generation of false documents over several years to conceal these payments.
Mayor Olivia Chow confirmed that Damen met all disclosure requirements during the contract negotiation in 2024, emphasizing the city’s vigilance in the matter.
The mayor underscored the city’s commitment to the ferry project and pledged to act accordingly should the situation evolve, maintaining a third-party inspector at the shipyard for ongoing updates.
“We need our ferries, and they’re in the middle of building [them], so we’ll see,” Mayor Chow remarked, addressing potential responses to the situation without ruling out the possibility of contract termination.