Battle for Sh3bn Mombasa port tender returns to court
Cargo at the port of Mombasa. Top global conglomerates including Toyota and Maersk are fighting for a Sh3bn tender at the harbour. AFP PHOTO
The fight for a Sh3 billion tender for the operation of Mombasa Port has returned to court, marking yet another twist in the lucrative contract that has pitted top global conglomerates including Toyota and Maersk against each other.
High Court judge Louis Onguto on Thursday stopped the Public-Private Partnerships (PPP) committee from hearing an appeal against the disqualification of Danish logistics firm Maersk from the $300 million (Sh3 billion) tender.
Justice Onguto issued the order after Maersk through its subsidiary APM Terminals argued that the PPP committee has denied it crucial documents needed for the appeal.
Maersk, which filed the appeal before the PPP committee, says it has been denied evaluation results from the first stage of the tender proceedings from which it was knocked out. It holds that the evaluation documents are a key part of evidence in its appeal.
Justice Onguto granted Maersk’s application to hear the case, and subsequently stopped the PPP committee from proceeding with the appeal which was set for September 15.
“I hereby grant leave to the applicant (Maersk) to apply for judicial review proceedings for purposes of being quashed the decision of the PPP committee declining APM’s request for disclosure. The leave shall operate as stay of any other proceedings relating to the petition filed by APM,” the judge ruled.
Justice Onguto asked the parties to appear before him on September 29, when the PPP committee and KPA are expected to file their responses to the suit.
The logistics firm holds that the Kenya Ports Authority misled it into indicating the wrong expiry date on its bid bond before disqualifying it from the proceedings.
The bid bond is a guarantee that the contracted firm shall operate as per the agreement and is issued by a bank. Maersk says its bid bond was issued by Barclays Bank and is to expire on January 31, 2016. But KPA held that the date was too soon hence disqualified it.
Maersk now says KPA changed the bid submission deadline and had allowed it to retain the January 31, 2016 expiry date hence should be allowed to proceed to the next stage.
The PPP committee acknowledged on August 31 that it has received a copy of the evaluation, but said it could not give it a copy of the document.
“The applicant relied on and acted upon KPA’s guidance where it allowed Maersk to retain January 31, 2016 as the date of expiry of APM’s bid bond,” the firm holds.
Maersk adds that the date indicated on the bid bond does not affect its technical or financial capacity and that the error is a minor deviation, which KPA ought to have ignored.
The Danish firm in May won a court battle against KPA over its eligibility to bid for the multi-billion shilling tender.
KPA had introduced a provision barring shipping firms from competing for the deal. But Justice George Odunga ruled that the provision is part of another court case in which its implementation has been stopped until a final determination is made.
A total of 12 firms had thrown their hats in the ring for the deal, but only Toyota Tsusho Corporation, Kamigumi Company Limited Mitsui Engineering and Mombasa Maize Millers progressed to the second stage.
By 2016, the new Mombasa Port terminal is projected to have a capacity of 450,000 twenty-foot equivalent units (TEUs), a measure of container capacity, and rise to 1.2 million TEUs by 2019.
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