Apex Court Revokes Joho Family's KPA Tender Decision
The Supreme Court of Kenya has cancelled a decision by the Kenya Ports Authority (KPA) awarding a tender to Portside Freight Terminals Limited for the development of a second bulk grain handling facility at the Port of Mombasa. This decision effectively suspends the project and affirms the supremacy of constitutional procurement principles over expedited or non-transparent procedures.
### Key Details of the Decision:
The tender was worth Sh5.8 billion, and the KPA had awarded the contract to Portside Freight Terminals Limited through a Specially Permitted Procurement Procedure (SPPP). This procurement method allows bypassing the usual competitive tendering if justified by national security or public interest. However, the Supreme Court found that KPA breached constitutional procurement laws by sidestepping a competitive bidding process and opting for the SPPP without sufficient justification.
Busia Senator Okiya Omtatah had challenged the decision, arguing the process lacked transparency, was discriminatory, and unfairly excluded other eligible bidders. The court held that even where SPPP is used, the process must still be fair, equitable, transparent, competitive, and cost-effective.
### Implications:
The ruling preserves the monopoly of Bulkstream Ltd, which has controlled grain handling at Mombasa port for over three decades, by preventing the entry of Portside Freight Terminals. It strengthens enforcement of constitutional procurement laws in Kenya, emphasizing that no project, regardless of its national security or public interest status, can bypass competitive and transparent tendering requirements.
The decision validates the role of public interest litigants like Senator Omtatah in holding government agencies accountable, reinforcing transparency and fairness in public procurement. Future projects for grain handling at the port must observe full competitive tendering processes, reinforcing legal and governance standards for public contracts.
### Summary:
The Supreme Court struck down the award of a Sh5.8 billion contract to Portside Freight Terminals Ltd because KPA failed to conduct a proper competitive tendering process, violating constitutional procurement laws. The court acknowledged the project’s importance but insisted that upholding the Constitution and transparent procedures took precedence. This ruling sets a precedent enforcing fairness and accountability in procurement, preventing potential favoritism or non-transparent deals in public infrastructure projects.
The case is ongoing, with no final decision made about the legality of the tender award process to Portside Freight Terminals Limited. The Supreme Court has not yet overturned the Court of Appeal’s finding that the invocation of the SPPP under Section 114A of the PPAD Act did not violate the Constitution. The second grain bulk handling facility project is considered important, strategic, and in the public interest.
- The cancellation of the Sh5.8 billion tender by the Kenya Ports Authority (KPA) for a second bulk grain handling facility at the Port of Mombasa, awarded to Portside Freight Terminals Limited, has significant implications for both the business and politics industries.
- This decision highlights the role of the Supreme Court in ensuring adherence to constitutional procurement laws, setting a precedent that emphasizes fairness and accountability in public procurement processes.
- The ruling also underscores the importance of the finance sector, as it underscores the need for transparent and competitive procurement procedures to protect public funds, ensuring they are not misused in non-transparent deals.
- Furthermore, this court ruling stresses the importance of general-news media in keeping the public informed about the proceedings, allowing them to stay engaged with the politics and business decisions that affect their lives.
