Hitecon had sought a court intervention citing irregularities after it was allegedly disqualified from the 2023 controversial tender for failing to provide a list of local sub contractors. The tender was allegedly awarded to Zhong Gan Engineering. The Hitecon company reportedly upon learning about the tender being awarded to Zhong Gan approached court wanting among others a rule nisi (temporary order) to interdict and restrain the respondents from proceeding with the procurement process and freezing the procurement process pending a review application. Justice Zein Kebonang, recently when confirming the rule nisi issued on May 14, 2024 to interdict and restrain the respondents, explained that the decision to disqualify the company on grounds that it had not provided a list of citizen sub contractors when that was not the requirement in the Invitation to Tender (ITT) was irrational and improper. “By qualifying the applicant’s bid on a criterion not specified in the ITT, the respondents committed prima facie reviewable irregularity. On this ground alone, the applicant has been able to establish upon examination a right entitling it to the interdict,” he said. The judge said the applicant had contended that if the interdict is not obtained, its appeal rights before the Tribunal as well as the review application, will be rendered null and void.
The judge emphasised that in terms of the Procurement Act, the Tribunal can only suspend a procurement process or performance where a contract has not been concluded and that where, however, the contract has been concluded, it shall become irrevocable and its execution shall proceed without interruption whether the award decision by the Accounting Officer may in itself remain disputable by a contractor through the Tribunal. “On all these considerations, it is clear that the applicant will have no alternative relief in due course and the balance of convenience favour the granting of the interdict,” Justice Kebonang said. Justice Kebonang further explained that the applicant also contended that the decision to disqualify it was irrational because its bid was disqualified on a criterion that was not spelt out in the ITT. He pointed out that the company said it was disqualified on the basis that it had failed to provide a list of its proposed citizen sub contractors in its bid documents when that was not a requirement. “It also says the company awarded tender cited as third respondent was unlawfully awarded the tender when it should have been disqualified as it had not participated in the compulsory pre-tender meeting,” he said. The judge stated that as a general rule, it is for a procuring entity and not the court to decide the prerequisite for a valid tender and whether or not a tender offer is correctly disqualified must therefore be evaluated from such a perspective. He explained that failure to comply with prescribed conditions will usually result in a bidder being disqualified. Justice Kebonang noted that in the instant case, the ITT stated that preference margins will be applied to qualifying bidders in line with the Economic Diversification Drive (EDD) and the Citizen Economic Empowerment Policy. “There is certainly a difference between preference margins, which are the extra mark up on price allowed for any domestic contractor or supplier bidding under a Competitive Bidding without being otherwise disadvantageous to the bid in terms of price and providing or drawing a list of sub contractors,” he stated. In conclusion, he explained that regarding other requirements for granting interim interdict, although the Zhong Gan company has been awarded the tender, it is yet to sign the contract with the procuring entity and that the company has denied mobilising to be on site on reasons that it cannot do so until it has signed a contract and has fulfilled conditions precedents in the award.
“For all the above reasons, the rule nisi issued on May 14, 2024 is hereby confirmed with costs. Such costs are to be paid by the respondents, one paying the other to be absolved and the costs to include costs of counsel,” he said.
The tender and dispute
In court papers, it states that in 2023, the applicant (Hitecon) was invited by the BDF to tender for three (3) projects and two of the projects were to be carried out at Thebephatshwa Air Base and the other in Francistown.
The invitation to tender (ITT) which was floated by the BDF, reportedly indicated among other things that the tenders would close on July 18, 2023 and that all bidders were expected to attend a compulsory pre-tender meeting at Thebephatshwa on July 4, 2023. “The ITT also indicated that the tender documents could be collected from the BDF Barracks in Mogoditshane from June 26, 2023 and that queries or clarifications should be made and or received by the procuring entity no later than seven (7) working days before close of tender. It is common cause that the applicant responded to the tender and attended the compulsory pre-meeting at Thebephatshwa while the third respondent only did so later on,” reads court documents. According to the documents, at the tender site visit attendance, the register indicated that the compulsory pre-tender meeting was attended by twenty-one (21) companies all together and Zhong Gan allegedly said that it received a notice to tender on July 5, 2023 and that on July 6, 2023 it proceeded to purchase the tender documents and on the same day attended a compulsory pre-tender meeting at the Botswana Defence Force Barracks in Donga, Francistown. “It was at this meeting that it discovered that there had been another compulsory pre-tender meeting in respect of the Thebephatshwa Air Base tenders at Thebephatswa on July 4, 2023. Although the date for the compulsory pre-tender meeting was stated in the tender document, the third respondent says it was never notified of the date,” further stated court papers. Meanwhile, on July 10, 2023, Zhong Gan allegedly wrote to the BDF to enquire among other things whether (a) it could tender for the Thebephatshwa projects notwithstanding having not attended the compulsory pre-tender meeting of the 4th July 4, 2023 and (b) whether the bid timelines could be extended by at least two weeks for it to provide a more favourable proposal. Subsequently, court documents stated that as a result, an undated and addressed to no particular entity, it appeared that an addendum was then issued not by the BDF but by the Director of Procurement Oversight, at the Ministry of Defence and Security, extending the closing date from July 18, 2023 to August 1, 2023 and setting a compulsory pre-tender meeting for the July 20, 2023, notwithstanding that this meeting had already happened.
The papers further mention that on May 2, 2024, the third respondent was awarded the disputed Thebephatshwa project at the value of P169, 513, 412. 68 (VAT Inclusive) to be completed within 16 months while the applicant's bid for the same project was P101, 735, 174.85 (VAT Inclusive) with a completion duration of 10 months. “Following its disqualification on March 19, 2024, the applicant immediately filed a complaint with the Accounting officer in terms of Section 104 (2) of the Public Procurement Act. The Section in 51 question provides that a contractor who is aggrieved by a breach of any provision of the Act or claims to have suffered or is likely to suffer loss or damages due to a breach of a duty imposed on a procuring entity shall at the first instance, lodge a complaint before the Accounting Officer for review,” states papers. The documents further revealed that the applicant's complaint, so lodged, remained unanswered until April 1, 2024, when its disqualification was confirmed on the basis that it had not provided a list of local sub- contractors in its bid documents as required by the ITT. The judgment further indicates that in the dismissal letter, the Permanent Secretary in the Ministry of Defence and Security, Pearl Ramokoka, in her capacity as the Accounting Officer, wrongly stated that Zhong Gan had attended the July 4, 2023 compulsory pretender meeting at Thebephatswa, when that was not so. Although the letter from the Permanent Secretary appears to have been written on April 11, 2024, Hitecon alleged that it only became aware of it on May 2, 2024 when the letter reached them. “Immediately upon learning on May 2, 2024 that the disputed tender had been awarded to Zhong Gan, Hitecon filed an urgent ex parte application on May 10, 2024 seeking orders among others a rule nisi issue interdicting and restraining the respondents from proceeding with the procurement process and freezing the procurement process,” reads the background of the dispute.
