De La Rue wins case against KRA

By Evelyn Kwamboka

De La Rue Company and Security Print Limited has won a case challenging a parastatal’s decision to award a tender to its rival.

This follows the High Court’s decision to quash any contract for printing adhesive stamps signed by Kenya Revenue Authority and Madras Security Printers Limited.

Justice Joseph Nyamu said the court was satisfied that De La Rue was a local firm producing Kenyan goods and had a manufacturing capability at its factory in Ruaraka, Nairobi.

He said it was unreasonable for KRA and the Public Procurement Administrative Review Board to brand the company’s goods as "imports", given the documentation available in the tender evaluation process.

In the case, De La Rue claimed the board failed to consider relevant provisions of the law cited by upholding KRA’s decision to award Madras Security Printers the tender.

KRA had invited bidders for the printing, supply and delivery of adhesive stamps last year.

De La Rue argued that it was invited to the opening of financial bids on May 2.

It claimed the other bidder present at the opening of financial bids was India’s Madras Security Printers, which it was informed, did not meet requirements for award in July.

Aggrieved

Aggrieved by KRA’s decision, the company requested the board to review the parastatal’s decision on grounds that under the Public and Disposal Act 2005 and Public Procurement and Disposal Regulations 2006, it was entitled to a 15 per cent margin of preference over its rival.

The company said the margin of preference was not applied during the evaluation of tenders.

On July 22, the board dismissed the review application and directed KRA to continue with the procurement process.

Yesterday, Justice Nyamu said although the board did make findings that the procuring entity had breached the law which provides for 30 days for evaluation of tenders after being opened, it declined to intervene on the ground that this did not cause any prejudice to the company.

"I therefore find that the board did commit an error of law by failing to address mandatory provisions of the Procurement Disposal Act intended to underpin the integrity of the evaluation process," he said.

The judge said failure by KRA and the board to have regard to mandatory provisions of the Act concerning procurement procedures including failure to give margin of preference, violated the purpose of the Act.