IT firm moves to court to demand CBK security tender

A technology firm has moved to court seeking orders to compel the Central Bank of Kenya (CBK) to award it a controversial Sh1.2billion security system tender.
High Court Judge Weldon Korir Tuesday cleared Horsebridge Network Systems East Africa Limited to sue the CBK for failing to give it the job of installing a security system at the institution.

“Leave is granted for Horsebridge to seek orders compelling CBK to conclude and execute the agreement in respect to the tender for the supply, installation and commissioning of an Integrated Security Management System for CBK,” Justice Korir said.

Controversy surrounding the tender was behind Director of Public Prosecution Keriako Tobiko ordering the arrest of CBK Governor Njuguna Ndung’u last month. Prof Ndung’u later obtained court orders against the arrest.

In its application Horsebridge claims the CBK has declined to award it the tender despite the counsel of the Public Procurement Oversight Authority (PPOA) to do so.

READ: Central bank governor faces charges over security tender

Through its lawyer, Andrew Wandabwa, Horsebridge argues the Public Procurement Appeals and Review Board (PPARB) on January 4 directed the CBK to finalise contract agreements and pay a performance bond of Sh121.9 million but it was yet to do so citing an ongoing investigation by the Ethics and Anti-Corruption Commission.

A performance bond is issued to one party of a contract as a guarantee against failure of the other party to meet obligations.

“CBK has refused to enter into contract with the Horsebridge in respect to the cited tender notwithstanding the fact that PPARB had directed them to do so after successful negotiations and have continued to hold these money,” Mr Wandabwa says in the application certified as urgent.

Horsebridge in its application says there was no commercial or legal consideration impeding the signing of the agreement. It further claims that neither the DPP nor the anti-grafts body had written to the CBK to stop the process.

“In any event investigations cannot form the basis of refusal to comply with the provisions of the Public Procurement and Disposal Act,” Mr Wandabwa says.

The hearing of Horsebridge’s application has been set for March 28.

Last month Prof Ndung’u obtained an order blocking his arrest for allegedly engaging in irregularities over the security tender.

Prof Ndung’u is alleged to have rejected advice from internal and external legal teams to appeal the Public Procurement and Administrative Review Board’s decision to award Horsebridge the contract. Horsebridge, an international IT company with a local presence, was among six firms evaluated for the contract.

The others were Orad Limited, Azicon Kenya Limited, Engineered Systems Solutions Limited, Indra Limited and Aua Industria.

Appeals board

Horsebridge moved to the appeals board seeking a reversal of the CBK’s tender committee’s decision to reject all the bids for the security systems job.

However, Horsebridge filed its appeal before the tender committee announced the decision, suggesting it was privy to the outcome.

The tender committee chaired by deputy Governor Harun Sirma had nullified the CBK technical evaluation team’s decision to award the tender to Horsebridge after it detected errors in the tender documents.

This triggered a series of events that saw the matter end up at the PPOA and ultimately with the anti-corruption team. 

Horsebridge had petitioned the Public Procurement and Administrative Review Board, saying it won the tender as the lowest bidder.

The procurement review board “awarded’ HorseBridge the tender and dismissed CBK and the tender committee as a “wild horse who should be calmed”.

“The board holds that the procuring entity and specifically the tender committee is behaving like an unruly horse and it has to be tamed and calmed.

“The board orders that this tender be and is hereby awarded to the lowest bidder Horsebridge Networks Systems,” stated Mr Mwaniki Gachora in the board’s communication.