Thursday, June 4, 2020

DIS prevails over China Jiangsu in court

The Lobatse High Court on Friday stamped its seal of approval on an advice by Directorate of Intelligence and Security (DIS) that the Public Procurement Disposal Board withdraws a tender that had been awarded China Jiangsu.

China Jiangsu had brought the legal challenge challenging the Public Procurement and Asset Disposal Board (PPADB)’s decision to award a tender for the construction of Moshupa Hospital to its rival Zhengtai Group Botswana.

Delivering judgment, while she found the decision by DIS advising the PPADB and the Ministry of Infrastructure and Housing Development to cancel the award of the tender the affected company to be unprocedural and lacking facts, Dube dismissed the legal challenge by China Jiangsu Botswana to interdict the awarding of the tender to its rival Zhengtai Group Botswana.

“…I also acknowledge and recognize that under section 5 of the Intelligence Security Services Act, the Director General has power and the mandate to investigate, cause investigation in respect of cases involving corruption, etc,” said Dube.

She stated that the Director General may during “the course of his or her duties or as a consequences of his or her findings, provide advice or give such directions as are necessary and appropriate in the circumstances.”

“Furthermore, Section 53(1) of the PPADB Act provides that “the Board shall act upon complaints by procuring and disposing entities, contractors, the media and the public in respect of any party to an allegation of impropriety is made,” said Dube.

However, Dube found that, in “this particular case, the court is constrained from considering the said information from DIS for lack of details or proof thereof.”

“The court works on and relies on facts and not on speculation. The Respondents have not put in their confidence regarding the said allegations nor is DIS a party to the proceedings so the Court could get more details, whether in camera or otherwise,” Dube said. 

Further, whilst she said she recognizes that public procurement is prone to abuse and corruption owing to various factors, including: large sums involved, some abuse may go on undetected. Therefore, he said, investigations by relevant authorities may as well be most effective response in such cases.

“I’m however, of the view that the manner in which the information or interjection by DIS was introduced and executed was unprocedural and outside the procurement process. If the nature of such interjections was part of the ITT (Invitation to tender) or evaluation process it would have made sense. But the information emerged towards the end without giving the Applicant and opportunity to be heard or to defend itself,” said Dube. 

The judge stated that “In light of the Board’s mandate that its decisions are to be premised on transparency, fairness, accountability and public confidence, I shall accordingly find that in respect of the first requirement the Applicant has demonstrated a clear right. If it is not clear I shall assume on the facts that its prima facie established, though open to some doubts.”

On contention by China Jiangsu Botswana that it will suffer irreparable harm should it not be awarded the tender, Dube said the contractor had failed to demonstrate how it would suffer irreparable harm.

She said Courts are generally reluctant to delay a contract award or project because of an alleged breach of the procurement regulations where this would be detrimental to the public interest.

“In casu (in this case), the service tendered for if the construction of a primary hospital to be used by inhabitants of Moshupa village and surrounding villages. The hospital is to be constructed within two and half years,” Dube said, She said China Jiangsu Botswana  The launched the interdict application in order to prevent the signing of a contract for the project to begin pending the decision to award the contract to be set aside. 

“The legal challenge meant that the contract award procedure would be suspended for basically an indefinite period or until the matter has been determined. The correct approach would be to consider the consequences of suspending the project which would be detrimental to the public health more than it would be too prejudicial to Jiangsu Botswana’s private commercial gain,” said Dube.

Justice Dube said she was satisfied that the balance of convenience favours the Respondents(Ministry, PPADB etc).

“My reasons are: There would be substantial prejudice to the 3rdRespondent and the public at large, the earliest in practice that there could a court resolution of the disputes between the parties in relation to review (and possible appeals) is not less than 12 months, there is general public interest and outcry for services such as are on offer under this tender and access to healthcare services is critical to good health,” she said.

According to the judge, “One has to bear in mind that, if any or all public procurement, especially for essential projects such as the one in casu, could be stopped by essential projects because there was merely a serious issue to be tried about the procurement, without more, the public authorities would be invariably targeted by unsuccessfully tenderers and procurements would or could grind to a halt.”

She said to halt the tender would be detrimental to the interests of the public in terms of delaying or depriving the citizenry of health facilities whilst China Jiangsu Botswana would, in the event it succeeds in the review application have an opportunity to sue for damages. 

China Jiangsu had also demanded that the Ministry of Ministry of Infrastructure and Housing Development “cause the Director General of the Directorate of Intelligence and Security retract a Savingram dated 8th February 2019 in which unfounded and false allegations and or/injurious falsehoods are being paddled that Applicant has been involved in massive corrupt practices that threaten national security of Botswana.” 

The savingram in question informed addressed to Permanent Secretaries states that “Intelligence gathered by this Directorate has revealed that China Jiangsu International has been involved in massive corrupt activities that threaten national security of this country.”

Jiangsu tendered for a Works Contract for the Procurement of Proposed New Primary Hospital at Moshupa Tender No.WOR 7/6/8 and it was recommended for the awarding of the tender only for it to be awarded to another Chinese company, Zhengtai Group Botswana.

The company is expected to appeal the High Court’s decision to dismiss its application to interdict the tender.

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