11 February 2016

Namibia: Anhui Sues Govt Over Cancelled Airport Tender

Windhoek — The cancellation of the N$7 billion airport tender in December by President Hage Geingob is now being challenged in court by the winning bidder, Anhui Foreign Economic Construction (Group) Corp. Ltd.

Last December the presidency issued a press release in which it said: "The President has, therefore, resolved to instruct the Minister of Works and Transport, to act under section 9(b) of the Airports Company Act, 1998 to direct that the NAC [Namibia Airports Company] discontinues all activities relating to the upgrading of HKIA [Hosea Kutako International Airport], so that the process commences de novo under the auspices of the Ministry of Works and Transport in line with the State Finance Act, 1991 (Act No. 31 of 1991) and the Treasury Instructions thereunder. It is hoped that as a government project, the correct, adequate and transparent tender procedures will be followed."

The cancellation did not sit well with the Chinese company and they lodged a review application in the High Court to set aside the decision of the President as unlawful.

They are also asking the High Court to uphold the award of the tender, valued at almost N$7 billion for the upgrading and expansion of Hosea Kutako International Airport.

After the tender was awarded to the company on December 03, 2015 various articles questioning the award and alleged back-handed dealings started appearing in local dailies, which the company claims led to the cancellation of the tender.

According to an affidavit by Yu Xiaofeng, representing Anhui, the naews reports had a direct impact on the decision of the President to cancel the tender and start the process afresh.

The intention to start the process afresh and invite new tenders, while the review application is pending, prompted Anhui to approach the court on an urgent basis to stop the respondents from going ahead with the process.

They want the court to interdict the government through the Minister of Works, the Namibia Airports Company and/or the Ministry of Finance from publishing, advertising or otherwise calling for interested parties to submit bids for the upgrading and expansion of the airport pending the outcome of the review proceedings.

According to Advocate Nazeer Cassim, SC, who is representing Anhui on instructions from Tjombe-Elago Law Firm and assisted by Advocate Werner Boesak, the interference by the Minister of Works and Transport and the President in what is a "contractual relationship between Anhui and the NAC is unwarranted, unjustified and of no legal force and effect".

He said it would be "inept" for the applicant to sit back and watch months of negotiations and preparation worth thousands, if not millions of dollars, go down the drain.

While remedy in the form of a damages claim is available to the applicant, he argued, it will be a drawn-out process and the damages suffered will be difficult to quantify and prove.

In any event, he said, the prejudice to be suffered by the respondents in the event the application for interim relief is granted is by far outweighed by the damages the applicant will suffer if the process is to go ahead.

Sisa Namandje who acted on behalf of government on instructions from the Government Attorney submitted that the applicants have no locus standi as they are not represented in Africa.

According to him their local representative who is acting on a special power of attorney does not have the required authorisation according to the Rules of the High Court. He further said that the fatal non-joinder of two necessary and interested parties in the other bidder in the tender and the Permanent Secretary of the Ministry of Works and Transport further deals a blow to their chances.

He further argued the applicant failed to make out necessary allegations sustaining a course of action in the form of interim relief, hence an exception has been established by the respondents. He said the relief sought by the applicant is not an ordinary one, but is aimed at interdicting the respondents from carrying out their constitutional and statutory duties. In any event, Namandje argued, the tender award was illegal as the permanent secretary does not have the power to make an award. Subsequently, he said, no case for interim relief was made out by the applicant.

Judge Shafimana Uitele heard the application and indicated that he would be ready with his ruling on or before March 02.

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