Court blocks tendering of botched new-age driving licence

Kenyan drivers will wait longer to secure the smart card driving licence after the High Court suspended the Sh2.8 billion tender for breach of contract.

Infocard Holdings Ltd, the firm that won the government’s tender to design, finance, and operate the smart card driving licence obtained court orders stopping the Ministry of Transport and the Attorney-General from awarding the tender to a third party.

Commercial Court judge Alfred Mabeya certified the urgency of an application by Infocard and issued an order of interim measure of protection.

Infocard wants the dispute with the ministry referred to an arbiter as the parties had agreed on an alternative resolution mechanism by invoking clause 38.2 of the Arbitration Act.

“In breach of the contract, the Transport ministry has refused to perform its obligations under the agreement despite Infocard having embarked on the project including purchase of equipment, shipment of the items to Kenya and storage,” said the firm’s managing director Albert Karaziwan in a sworn affidavit.

Infocard moved to court after the government refused to provide the firm with a guarantee equivalent to Sh174 million or five per cent of the tender sum.

On October 29, 2007, the Ministry of Transport in conjunction with the Kenya Revenue Authority (KRA) invited tenders for the provision of analysis, design, development, operation and maintenance of the second generation smart card driving licence on a Build, Operate and Transfer (BOT) basis.

A consortium of two companies- Semlex Europe of Belgium and locally-based Compulynx Ltd submitted bids for the project and won the tender having passed the technical and evaluation requirement to the satisfaction of the government.

Infocard says the government accepted the order made by the consortium for the total project value of Sh2.8 billion but subject to the execution of a concessional agreement and the provision of a performance security of five per cent of the cost from a reputable commercial bank.

Subsequently, in compliance with the request by the ministry, the consortium incorporated Infocard Holdings as the entity to exercise the rights of the consortium.

Unveiling the project in July 2009, the then Transport minister Chirau Ali Mwakwere said the new licence would have special features bearing the driver’s photograph, signature, date of issue and expiry, date of birth, sex and licence class, among others.

The information would be held electronically by the Registrar of Motor Vehicles.