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The delays in signing for the PAAMS MoU delayed the remainder of the Horizon programme. The UK effectively put a hold on further progress by refusing to sign the Supplement 1 to the Project Horizon MoU until the three partners had reached agreement over PAAMS in that they should find a cost-effective technical solution that also met national work share arrangements. The UK also had a desire to derive maximum long-term benefit from the radar for PAAMS and had reservations about the performance of EMPAR. Issues of work share, cost and competition complicated the final decisions over two major PAAMS subsystems - the Long-Range Radar [LRR] and vertical launch system [VLS].
Three MoUs were finally signed in March 1996. They covered the general rules governing the three partners' collaborative effort for overall development and production of the PAAMS programmethe PAAMS Full Scale Engineering Development Initial Production Phase [PAAMS MoU Supplement 1] and a supplement to the Horizon programme covering the design definition phase [CNGF Programme MoU Supplement].
As the programme continued, problems continued to arise. There were disagreements in early 1997 over the type of vertical launch system to be employed. The French and Italians favoured the Franco-Italian Sylver A50 developed by DCN and Alenia, and licensed by BAe Dynamics. The UK however, had shifted to support the Mk 41, supplied by Lockheed-Martin, which
would allow the installation of US SM-3 based theatre missile defence missiles. The UK had also been refusing to negotiate a full-scale engineering development and initial production contract for PAAMS on the terms that had been offered by industry to the PPO, and had resisted moves by France and Italy to relax the PAAMS performance specification set out in the original agreement.