Watchdog cancels Sh2.8bn Kenya Power cables tender

The public procurement watchdog has cancelled the award of a tender by Kenya Power to four firms for the supply of power cables and conductors, adding to a string of botched deals by the utility.

Kenya Power had awarded the Sh2.81billion contract, which was split into 10 lots, to four firms including Conductors and Transformers Manufacturing Limited (Sh678.6 million); Cable Connect Limited (Sh1.39 billion); Green Hills Cable Company Limited (Sh548.9 million) and Showan Limited (Sh193.3 million).

The four firms were among 10 companies who bid for the tender.

Indian-registered Pasondia Cables Private Limited, whose bid was among those thrown out, contested the decision by the Kenya Power tender committee and sought redress by the Public Procurement Administrative Review Board (PPARB). It said it was penalised for allegedly failing to submit a letter on the company resolution and beneficial ownership.

Power of attorney

The firm however argued that it did not need to file a company resolution as it provided a power of attorney authorising a legal representative, Sagar Gupta to sign the tender documents on its behalf.

“That in any event, for the purposes of signing the tender document on its behalf, the power of attorney serves the same purpose and/or is equivalent to a company resolution authorising the same,” Pasondia, through lawyers Abdullahi, Gitari & Odhiambo Advocates argued.

The firm argued that under the requirement to file beneficial ownership details, it provided Form No. MGT-& — an electronic filing of annual returns which is recognised in India where it is based and registered.

Kenya Power however argued that Pasondia filed a beneficial ownership disclosure form that was not duly filled and that submitting a company resolution was a mandatory requirement.

PPARB in its ruling concurred with the Indian firm that it did not need to file a company resolution as it had already the power of attorney.

Beneficial ownership disclosure

“Accordingly, the Board finds that the procuring entity (Kenya Power) erred in its evaluation by requiring the Applicant to provide company resolution as per clause 2.2.4 yet the tender document had provided for an alternative, being the power of attorney,” it ruled.

It also ruled that being a foreign firm, Pasondia complied with the beneficial ownership disclosure requirement by providing Form No. MGT-7 which is equivalent to Form 9 in India.

The Board quashed the award of the tender to the four firms and directed Kenya Power to redo the procurement from the technical evaluation stage and award the tender to winners within 14 days.

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