Central Bank of Kenya Governor Njuguna Ndung’u. FILE PHOTO |
What you need to know:
CBK cancelled the tender for the second time last year, which forced Horsebridge to seek the intervention of the Court.
CBK had earlier argued that it had every intention to go through with the deal, but had cancelled the contract to allow EACC a chance to conclude its investigations.
EACC on its part insisted that the CBK had budgeted for the supply of the services at Sh800 million, but that the tender awarded is worth Sh1.2 billion. This, it held, was evidence that the entire process was tainted with illegality.
The High Court Thursday awarded a Sh1.2 billion tender for Central Bank’s security surveillance to an IT firm, Horsebridge Networks, reversing an earlier cancellation of the deal that was meant to give the anti-corruption watchdog sufficient time to scrutinise the contract.
Horsebridge Networks in March filed a suit seeking to have CBK compelled to give it the tender to supply, install and commission an Integrated Security Management System (ISMS).
The Ethics and Anti-Corruption Commission had been enjoined to the suit as an interested party, after it declared that it was carrying out investigations into the procurement process that saw two other bidders miss out on the deal.
CBK cancelled the tender for the second time last year, which forced Horsebridge to seek the intervention of the Court.
When it first cancelled the tender in 2012, Horsebridge moved to the Public Procurement Administrative and Review Board, which ordered CBK to go ahead with the deal.
Displeased with Justice Weldon Korir’s judgment in favour of Horsebridge, EACC made an oral application to have CBK and Horsebridge restrained from completing the deal for 30 days, so as to allow it to move to the Court of Appeal.
Both Horsebridge and CBK opposed the application, arguing that the services in question are of a sensitive nature and involve massive public funds, hence should be concluded as soon as possible.
“If you grant stay, it should be limited to seven days due to the sensitive nature of the tender,” said Andrew Wandabwa, who is representing Horsebridge in the suit.
“If EACC is truly interested in investigating further, it should make a formal application for stay clearly indicating grounds so that CBK has an opportunity to meet its case and allow the Court to rule on solid material,” added Waweru Gatonye, CBK’s lawyer.
Mr Justice Korir had granted the IT firm the orders it sought, arguing that none of the other bidders had appealed the decision of the Public Procurement Administrative and Review Board to grant Horsebridge the tender.
CBK had earlier argued that it had every intention to go through with the deal, but had cancelled the contract to allow EACC a chance to conclude its investigations.
EACC on its part insisted that the CBK had budgeted for the supply of the services at Sh800 million, but that the tender awarded is worth Sh1.2 billion. This, it held, was evidence that the entire process was tainted with illegality.
“It would defeat the purpose of judicial review if this court was to deny an applicant remedies where it has established that orders ought to be issued. Those are the circumstances in this case and orders will be issued as sought by Horsebridge,” said the judge.
EACC had said in its pleadings that its investigations led to the recommendation that CBK Governor Njuguna Ndung’u be arrested and charged with offences regarding the alleged irregular award of the deal to Horsebridge.
The CBK governor, however, obtained orders from the High Court in February barring his arrest until his suit against the Director of Public Prosecutions is determined.
Justice Korir added in his judgment that the EACC’s failure to conclude its investigations into the tender procurement process was partially the reason he ruled in favour of Horsebridge.
“On July 30 EACC informed the Court that it needed 45 days to conclude investigations. The time has since elapsed. The Court cannot speculate why it has not been concluded,” added Mr Justice Korir.
He, however, declined to agree with Horsebridge’s argument that EACC had no jurisdiction to investigate the procurement process.
Horsebridge had told the Court that the Public Procurement and Disposal Act does not provide leeway to the EACC to investigate procurement matters.
“In my view, the provision does not take away the powers of the EACC or any other agency to investigate crimes that may occur in the course of procurement,” the judge added.
The highly coveted deal saw 58 firms buy the tender documents, but only six bid for the deal.
Mr Gatonye, on behalf of Central Bank, said that Indra Limited and Engineered Systems Limited, the other two firms that had made it to the final evaluation stage, may have used the EACC to further personal interests.
This, he said, was because they were the ones that gave information to EACC that led to the investigations.
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