Muga Services Limited v Gofa Investments Limited and 2 Others (Application 35 of 2024) [2024] UGPPDPAAT 37 (22 July 2024)

THE REPUBLIC OF UGANDA

PUBLIC PROCUREMENT AND DISPOSAL OF PUBLIC ASSETS APPEALS TRIBUNAL

APPLICATION NO. 35 OF 2024

BETWEEN

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MUGA SERVICES LIMITED ::::::::::::::::::::::::::::::::::::

AND

1. GOFA INVESTMENTS LIMITED

2. MG ENGINEERS AND CONTRACTORS LIMITED

3. UGANDA CIVIL AVIATION AUTHORITY ::::::::::::RESPONDENTS

APPLICATION FOR REVIEW IN RESPECT $\mathbf{OF}$ THE PROCUREMENT FOR THE UPGRADE OF THE RUNWAY, TAXIWAY AND APRON AT JINJA AIRFIELD UNDER PROCUREMENT REFERENCE NUMBER UCAA/WRKS/2023-2024/00054

BEFORE: NELSON NERIMA; GEOFFREY NUWAGIRA KAKIRA; PAUL KALUMBA; CHARITY KYARISIIMA; AND KETO KAYEMBA, MEMBERS

DECISION OF THE TRIBUNAL

BRIEF FACTS $\mathbf{A}$ .

- Uganda Civil Aviation Authority (UCAA) (the 3^rd Respondent) 1. initiated a tender for the upgrade of the Runway, Taxiway and Apron at Jinja Airfield under procurement reference number UCAA/WRKS/2023-2024/00054 using the open domestic bidding method for the procurement of the works on May 9, 2024. - The 3^rd Respondent received bids from thirteen (13) bidders $2.$ namely; Tetra Technical Services Limited; Ocean Tech & Tegeka (Joint Venture); Roko Construction Company Limited; China Communications and Construction Company Limited; Stirling Civil Engineering Limited; Bulmak Associates Limited; KTM Investments Limited; Niem Establishments Limited; Al-Mubarak Contracting Limited; Stars Group and Kenfields Services SED (Joint Venture); Kiru General Services Limited; Muga Services Limited and Gofa Investments Limited & MG Engineers and *Contractors Limited Joint Venture*) on June 4, 2024. - Upon conclusion of the evaluation and adjudication process, 3. the Respondent issued a Best Evaluated Bidder Notice on June 11, 2024, in which Gofa Investments Limited & MG Engineers and Contractors Limited Joint Venture was named as the best evaluated bidder at a contract price of UGX. $23,471,923,508/=$ . - The notice stated that Muga Services Limited (the Applicant) $4.$ was disqualified at the Financial Stage of Evaluation, for offering a bid price of UGX. $24,145,072,798/$ =, higher than that of the Best Evaluated Bidder. - The Applicant being dissatisfied with the procurement process, 5. filed a complaint before the Accounting Officer of the Respondent on June 14, 2024 on the following grounds:

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- The best evaluated bidder and the joint venture partners $(i)$ individually did not fulfil the mandatory technical experience as required. - The validity of the best evaluated bidder notice was doubted $(ii)$ because it indicated a date of display as June 11, 2023 and date of removal as June 24, 2024 yet the year is 2024. - The procurement was done out of the EGP (GOU Electronic (iii) transparency was system and Portal) Procurement compromised and the evaluation was faced with subjectivity and hurried work. - The Accounting Officer issued a decision on June 24, 2024 $(iv)$ whereby he found no merit in all the grounds of the Applicant's complaint. - The Applicant being dissatisfied by the decision of the 6. Accounting Officer of the 3rd Respondent filed the instant application with the Tribunal on July 5, 2024, seeking to review the decision. - The Applicant made fresh allegations that the certificates of $7.$ completion submitted by the best evaluated bidder were either forged, or unrelated to the works. - The Application raised the following issues for determination; 8.

1) Whether or not the best evaluated bidder Gofa Investments Limited & MG Engineers Joint Venture met all the requirements for experience under Section 6.2.7 and 6.2.8 of the Bidding Document - 2) Whether or not the best evaluated bidder Gofa Investments Limited & MG Engineers Joint venture met the requirements under Section 6.2.5 and 6.2.8 of the Bidding Document. - The Applicant prayed that the Best Evaluated Bidder Notice be 9. set aside and that it be declared the Best Evaluated Bidder. - The 3^rd Respondent filed a response to the Application on July 10. 10, 2024. The 3^rd Respondent contended that the Applicant

did not furnish the Accounting Officer with evidence that the best evaluated bidder did not fulfil the mandatory technical experience under the Bidding Document, and there were therefore no circumstances that gave rise to the Application.

- The 3^rd Respondent reiterated its findings that the best $11.$ evaluated bidder met the technical and financial requirements under the Bidding Document. - The 3^rd Respondent prayed that the Application be dismissed. $12.$ - The Best Evaluated bidder filed a response on July 11,2024 in $13.$ support of the Respondent's award decision.

$\mathbf{B}$ . ORAL HEARING

- The Tribunal conducted an oral hearing via zoom on July 18, $1.$ 2024. - The appearances were as follows: $2.$ - Mr. Robert Apenya appeared for the Applicant. $1)$ - Mr. John Kallemera for the 3^rd Respondent (Entity). $2)$ - No appearances were entered for the $1^{st}$ and the $2^{nd}$ $\overline{3}$ Respondents.

$C.$ RESOLUTION

- In view of the pleadings and the written and oral submissions, 1. the issues have been framed as follows: - Whether or not the Respondent lawfully evaluated the bids in $1)$ respect of Specific Experience? - Whether or not the Respondent lawfully evaluated the bids in $2)$ respect of Financial Resources? - What remedies are available to the parties? $\overline{3}$ - The Tribunal has considered the pleadings, submissions, the $2.$ bids and the procurement action file.

Issue no. 1:

Whether or not the Respondent lawfully evaluated the bids in respect of Specific Experience?

Regulation 5 of the Public Procurement and Disposal of Public $4.$ Assets (Evaluation) Regulations 2023 provides that the evaluation of bids shall be conducted in accordance with the evaluation criteria specified in the bidding documents; and that an Evaluation Committee shall not, during an evaluation, make any amendment including any addition to the evaluation criteria stated in the bidding document, and shall not use any other criteria other than the criteria specified in the bidding document. Regulation 19 requires the Evaluation Committee to conduct a detailed evaluation of a bid that passes the preliminary examination to assess— (a) the responsiveness of the bid to the terms and conditions of the bidding document; and (b) the technical responsiveness of the bid to the statement of requirements. The detailed evaluation must compare the details of a bid with the criteria stated in the bidding document. A bid which is not substantially responsive to the minimum requirement of the detailed evaluation must be rejected.

- ITB 29.1 of the Bidding Document provides that the Entity shall $5.$ use the criteria listed in Section 3, Evaluation Methodology and Criteria. - ITB 31.1 of the Bidding Document provides that the Entity's 6. determination of a bid's responsiveness shall be based only on the contents of the bid itself with the exception of findings recorded in the Evaluation Report after a due diligence or post qualification. - ITB 31.2 of the Bidding Document provides that a substantially 7. responsive bid is one that conforms to all the terms, conditions and specifications of the Bidding Document without material deviation, reservation or omission. - However, regulation 6 of the Public Procurement and Disposal of 8. Public Assets (Evaluation) Regulations 2023 and ITB 32 of the Bidding Document permits the Entity to waive or request for missing information through clarification, provided the bid is substantially compliant and there is no material deviation. - For purposes of complying with the requirements for General 9. required a bidder was to (Factor $6.2.6$ ), Experience Experience under contracts in the role of demonstrate contractor, subcontractor, or management contractor for at least the last 03 (three) years prior to the bid submission deadline of $5,000,000,000/=$ . - Factor 6.2.7 (Specific Experience) provides as follows: 10. Participation as a contractor, subcontractor, or

management contractor in at least the last 03 (three) years prior to the bid submission deadline of Ug.shs. 5,000,000,000/=, that have been successfully and substantially completed (at least 70 percent complete) and that are similar to the proposed works. The similarity was to be based on the physical size, complexity, methods/technology, or other characteristics as described in Section VI. Employer's Requirements. Attach contracts and completion certificates. - For joint ventures or consortium or Associations, the condition 11. was for at least one partner to meet requirements for one characteristic. - Under Factor 6.2.8, a Bidder was required to demonstrate 12. experience under contracts executed during the period stipulated in 6.2.7, with a minimum experience in Civil Engineering works projects (Roads or runways) and must submit at least 03 completed projects. For joint ventures or consortium or Associations, the condition was for at least one partner to meet the requirements. - Bidders were required to demonstrate General Experience using 13. Form 9. Bidders were required to demonstrate Specific Experience using Form 10, Form 10A; and Form 10A (b). - Gofa Investments Limited & MG Engineers and Contractors $14.$ Limited Joint Venture did not submit Form 9; Form10, Form 10A; or Form 10A (b). Instead, they submitted a self-designed Table entitled General Experience and listed

25 contracts allegedly executed in the period 2009-2024. - Non-conformity with a particular form does not render a document 15. void. The substance rather than the form is considered. Section 43 of the Interpretation Act Cap. 2 provides that where any form is prescribed by any Act, an instrument or document which purports to be in such form shall not be void by reason of any deviation from that form which does not affect the substance of the instrument or document or which is not calculated to mislead. See our decision in APPLICATION NO.4 OF 2021- SAMANGA ELCOMPLUS JV versus PUBLIC PROCUREMENT AND DISPOSAL ASSETS AUTHORITY (PPDA) RESPONDENTS PUBLIC $\boldsymbol{OF}$ UGANDA ELECTRICITY DISTRIBUTION COMPANY LIMITED and APPLICATION NO. 13 OF 2021-KASOKOSO SERVICES LIMITED versus JINJA SCHOOL OF NURSING AND MIDWIFERY.

- The non-use of the prescribed form is therefore not fatal so long 16. as the required information and documentation is submitted. - The Tribunal noted that Gofa Investments Limited & MG 17. Engineers and Contractors Limited Joint Venture submitted copies of assorted completion certificates and call off-orders but did not submit copies of contracts relied upon to prove the Specific Experience. - The Evaluation Committee did not determine whether the 18. omission to submit the contracts was a material deviation which would lead to rejection of the bid. The Evaluation Committee did not determine whether, if the deviation was not material, the missing documents could be requested through clarification. - The Evaluation report indicates that the bid of the Gofa 19. Investments Limited & MG Engineers and Contractors Limited Joint Venture was responsive to Form 9-Specific Experience. This is erroneous because Form 9 was for General Experience, not Specific Experience. - The Specific Experience was evaluated on June 6, 2024 but 20. the minutes of the Evaluation Committee do not specify which contracts submitted by each bidder were determined to qualify as Specific Experience. However, the Evaluation Committee Report indicates that during post qualification on June 7, 2024, the following documents submitted by Gofa Investments Limited & MG Engineers and Contractors Limited Joint

Venture were determined as Specific Experience: - 1) Framework contract for mechanized maintenance $\quad\text{ of }\quad$ unpaved roads Lot4 Jinja station totaling to 106 km. - 2) Term maintenance of 48 selected national roads phase V; Lot $4$ . - 3) Upgrading to bitumen standard for Bulindo-Nakwero Road - As a matter of fact, Gofa Investments Limited & MG Engineers 21. and Contractors Limited Joint Venture did not submit any

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actual contracts copies. The underlying contracts for the call off orders and completion certificates were not submitted.

- During detailed evaluation, the Evaluation Committee should 22. have assessed the documentation submitted by each bidder to determine which of the claimed projects qualified as Specific Experience. Under ITB 39.1 of the Bidding Document, post qualification is used to determine whether the bidder that is selected as having submitted the best evaluated bid is qualified to perform the contract satisfactorily. The Evaluation Committee can only verify what has been evaluated during the detailed evaluation. The procedure adopted by the Evaluation Committee was erroneous. - Issue no. 2 is resolved in the negative. 23.

Issue No. 2:

Whether or not the Respondent lawfully evaluated the bids in respect of Financial Resources?

- Factor 6.2.5 (Financial Resources) provides as follows: 24. The bidder must demonstrate access to or availability of financial resources such as liquid assets, unencumbered real assets, lines of credit, and other financial means, other than any contractual advance payments to meet; (i) the cash-flow requirement: of Ug shs $10,000,000/=$ and(ii) the overall cash flow requirements for the contract and its concurrent commitments. - For joint ventures or consortium or Associations, the condition 25. was for at least one partner to meet seventy percent (70%) of the requirement. - Bidders were required to demonstrate Financial Resources 26. using Form 8. - Gofa Investments Limited & MG Engineers and Contractors 27. Limited Joint Venture did not submit Form 8. As resolved

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Decision for PPDA Appeals Tribunal Application No. 35 of 2024-Muga Services v UCAA 8: Ors

under issue no. 1, the non-use of the prescribed form was not fatal so long as the bidder provided the required information and documents.

- Gofa Investments Limited & MG Engineers and Contractors 28. Limited Joint Venture submitted a credit line confirmation from UGX. than less $\mathop{\mathtt{not}}\nolimits$ Ltd for $(Uganda)$ Bank $I\&M$ line credit $\overline{a}$ submitted also 10,000,000,000. They confirmation from C. B World Investment Ltd to supply 50/70 penetration bitumen on credit up to UGX. 1,000,000,000. - The Evaluation Report does not show that the Evaluation 29. for bids the evaluated all specifically Committee responsiveness to the requirement for Financial Resources. - However, the Evaluation Report indicates that during post 30. qualification the credit line UGX. 10,000,000,000 from I&M Bank was confirmed. - Availability of financial resources was an evaluation criterion 31. which should have been evaluated during detailed evaluation. It was erroneous for the Evaluation Committee to omit this evaluation and purport to carry it out only on the best evaluated bidder purportedly as post qualification. As resolved under issue no. 1, the Evaluation Committee can only verify what has been evaluated during the detailed evaluation. The adopted by the Evaluation Committee was procedure erroneous. - Issue no. 2 is resolved in the negative. 32.

Issue No.3: What remedies are available to the parties?

The Respondent's Evaluation committee failed to properly 33. evaluate the bids with respect to financial resources and specific experience.

- The procurement will be remitted back to the 3^rd Respondent 34. for re-evaluation. - The 3^rd Respondent is best qualified to handle the allegations 35. of forgery when conducting due diligence and post qualification.

$D.$ DISPOSITION

- The Application is allowed in part. 1. - The Best Evaluated Bidder Notice dated June 11, 2024, is set $2.$ aside. - The Respondent is directed to re-evaluate the bids in a manner 3. not inconsistent with this decision, the Bidding Document, and the law. - The re-evaluation in no. 3 above shall be completed within ten $4.$ $(10)$ working days from the date of this decision. - The Tribunal's suspension order dated July 8, 2024, is vacated. $5.$ - The Respondent shall refund the Applicant's administrative $6.$ review fees. - Each party shall bear its own costs for this Application.

7.

Dated at Kampala this 22^nd day of July, 2024.

Munici

Bally

NELSON NERIMA MEMBER

$\theta$

PAUL KALUMBA MEMBER

GEOFFREY NUWAGIRA KAKIRA MEMBER

tunica

CHARITY KYARISIIMA MEMBER

KETO KAYEMBA MEMBER

Decision for PPDA Appeals Tribunal Application No. 35 of 2024-Muga Services v UCAA & Ors