At the heart of this tender dispute lies a question of jurisdiction over public procurement laws. Core of the issue is whether the High Court has jurisdiction to review decisions by procurement entities, let alone appeals against their decisions or whether such jurisdiction is only restricted exclusively to the procurement Tribunal.
The matter involves two Chinese companies squabbling over a tender for the construction of facilities for the military.
Zhong Gan Engineering (Pty) Ltd, a Chinesse compaby owned by another Chinese company, China Jiangxi International Economic & Technical Cooperation was awarded the P170 million tender by the Botswana Defence Force (BDF). Aggrieved by the discrepancies, another Chinese firm, Hitecon (Pty) Ltd, owned by Zhongwen Hu, Su Luanchang, Zhang Guangjun, Hong Kai, Yuanpeng Hu and Zuchan Duan wants the awarded tender to be reviewed and cancelled.
In 2023, Hitecon was invited to tender for three projects by the Botswana Defence Force (BDF). Two of which were to be carried out at Thebephatshwa Air Base while the other was in Francistown.
The Invitation to Tender (ITT), which as floated by the BDF, indictated that the tenders will close on the 18th of July 2023 and required bidders to attend a compulsory pre-tender meeting at Thebephatshwa on the 4th of July 2023.
The ITT also indicated that the tender documents could be collected from the BDF barracks in Mogoditshane starting on 26th June 2023. Additionally, queries or clarifications were expected to be submitted to the procuring entity no later than seven working days before the tender’s closing date.
It appears that Hitecon responded to the tender and attended the compulsory pre-meetint at Thebephatshwa while another Chinese company, Zhong Gan Engineering, did so at a later stage.
The site visit attendance register indicates that the compaulsory meeting was attended by 21 companies.
According to the High Court judgement by Justice Zein Kebonang, Zhong Gan Engineering says it received a notice to tender on the 5th of July and purchased the tender documents the following day. On that day it also attended a compulsory pre-tender meeting at the BDF Barracks in Donga, Francistown. It was at this meeting that Zhong Gan Engineering discovered that there has been another compulsory pre-tender meeting in respect of the Thebephatshwa Air Base tenders at Thebephatshwa on the 4th of July 2023.
Court documents show that although the date for the compulsory pre-tender meeting was stated in the tender document, the Zhong Gan Engineering did not attend the meeting in Thebephatshwa.
On the 10th of July 2023, Zhong Gan Engineering wrote to the BDF to inquire among other things whether (a) it could tender for the Thebephatshwa Projects notwithstanding having not attended the compulsory pre-tender meeting of the 4th of July 2023 and whether the bid timelines could be atleast extended by two weeks for it to provide a more favourable proposal.
Things took an interesting twist after an undated addendum addressed to no particular party emerged. Court documents show that the addendum was issued by the Director of Procurement Oversight at the Ministry of Defence and Security, extending the closing date from the 18th of July 2023 to the 1st of August 2023 and setting a compulsory pre-tender meeting for the 20th July 2023, notwithstanding that this meeting had already happened.
According to the documents, on the 2nd of May 2024, Zhong Gan Engineering was awarded the disputed Thebephatshwa project at the value of P169 513 412. 68 to be completed within 16 months. Hitecon’s bid for the same project was P101 735 174.85 with a completion duration of 10 months, court documents show.
Following its disqualificationon on the 19th of March 2024, Hitecon filed a complaint with the Acconting Officer as required by the Public Procurement Act.
Hitecon’s complaint remained unanswerd until the 11th of April 2024, when its disqualification was confirmed on the basis that it had not provided a list of local sub-contractors in its bid documents as required by the ITT.
In the dismissal letter, court documents say the Permanent Secretary in the Ministry of Defence and Security, Pearl Ramokoka, in her capacity as the Accounting Officer wrongly states that Zhong Gan Engineering had atended the 4th July 2023 compulsory pre-tender meeting and Thebephatshwa, when that was incorrect.
Although the letter from the PS appears to have been written on the 11th of April 2024, Hitecon says it only became aware of it on the 2nd of May 2024.
Immediately upon learning that the disputed tender had been awarded to Zhong Gan Engineering, Hitecon filed an urgent court application on the 10th of May 2024.
Hitecon also sought a rule nisi issue interdicting and restraining Zhong Gan Enginering as the 3rd respondent, the Attorney General (representing the Ministry of Justice and Defence) as 1st respondent, and the Attorney General (representing the Botswana Defence Force) as 2nd respondent from proceeding with the procurement process and freezing the procurement process in respect of tender FOR THE PROCUREMENT OF THE PROPOSED CONSTRUCTION OF FACILITIES 140,491 AND 717 FOR BOTSWANA DEFENCE FORCE AT THEBEPHATSHWA AIRBASE pending: (a) the hearing and final determination of the review application to be brough by the Applicant in court in which the latter application by Hitecon will seek the review and setting aside of the decision toward the Tender aforesaid to Zhong Gan Engineering and/or the hearing and final determination Appeal brought by Hitecon and pending before the Public Procurement Tribunal and, in the event that Hitecon should subsequently appeal to the High Court, pending the hearing and final determination of the appel to the court.
Further, Hitecon sought an order that should the rule nisi be confirmed and made final, it shall institute the review application within 30 days of such confrmation.
Hitecon also sought to be awarded costs of the review application.
While Hitecon sought confirmation of the rule nisi on the grounds that it was wrongfully disqualified on a criteria that was not specified on the ITT and that the procuring entity acted unlawfully in awarding the tender to Zhong Gan Engineering when it had not attended the compulsory pre-tender meeting, both the Ministry and BDF, as represeted by the Attorney General opposed it.
In particular, the Ministry of Justice and Defence and the BDF, as represemtd by the Attorney General, challenged the jurisdiction of the court to hear the application.
According to Court papers, they contended that in terms of sections 113 and 115 of the Public procurement Act no 24 of 2021, the legislature intended to reserve the resolution of procurement dsputes to the Public procurement Tribunal and that the sections in question ousts the jurisdiction of the court in favour of the Tribunal.
Both respondents also argue that Hitecon’s application was not urgent and that Hitecon failed to exhaust all local remedies provided for in the Public Procurement Act, and that the company also had not disclosed all material facts adverse to it.
They also argued that Hitecon had failed to make a case for the interim interdict.
Answering to the objections on behalf of Hitecon, Dr Pilane submitted that the High Court has unlimited, original jurisdiction to determine any matter before it while the procurement Tribunal did not. Dr Pilane submitted further that the Public Procurement Act did not oust the jurisdiction of the Court and any such ouster if it existed would be unlawful. Further, he argued that on a proper construction of the Public Procurement Act, a party need not exhaust any of the remedies specified therein before coming to the High Court. Moreover he reasoned that Hitecon’s right to seek a review was not affected by the Procurement Act and that the Tribunal did not have any jurisdiction to the review proceedings.
He also submitted that Hitecon has established both urgency and had met the requirements for the granting of the interim interdict.
High Court Supremacy
In making Judgement, Justice Kebonang stated that Section 95 (1) of the Constitution does not only create the High Court but also confers upon it, unlimited original jurisdiction to hear and determine any civil or criminal proceedings under any law and such other jurisdiction and powers may be conferred on it by this constitution or any other law.
The Public Procurement Tribunal
Court documents detail that Section 114 of the Public Procurement Act states, “there is established for purposes of this Act a body independent of the Public Procurement Regulatory Authority, known as the Public Procurement Tribunal “. Under section 115 (1), the Tribunal is to ‘adjudicate over matters brought before it by a complainant for a breach of any provisions of the Act or any appeal brought in accordance with provisions of the Act”.
According to Section 115 (2), the Tribunal shall adjudicate over an appeal by a complainant of the decision of the Authority or an Accounting Officer arising at any point in a procurement process. It shall also adjudicate an appeal by the complainant at any point of regisration, declassification or disciplinary process or decision, a complaint by the Authority against a procuring entity, a dispute and resolution conflict between a procuring entity and the Authority, contractors in respect of the interpretation of this Action, breach, termination and interpretation of a procurement contract including an intergrity agreement.
In explaining the jurisdictional issue, Kebonang argued that unlike the High Court, the Tribunal can only have the jurisdiction conferred upon it by statute.
“It is without any inherent jurisdiction and cannot act outside the confines of its statutory powers. The Act only creates the Tribunal as an Appellant body,” he argued, adding further that a carefu reading of section 115 indicates that the object of the Act and the intention of Parliament was never to limit the jurisdiction of the High Court or confer exclusive mandate on the Tribunal in respect of procurement disputes.
“Any attemt to oust the jurisdiction of the Court or deprive it of its inherent unlimited jurisdiction would be unconstitutional and void,” he submitted.
Local remedies
Further, Justice Kebonang stated that the respondents’ position seems to be undermined by the Act’s use of permissive rather than mandatory language. He added that the only obligatory provision seems to be section 104 (2) which requires the complainants to first file its compaint with the Accounting Officer. Where the Accounting officer fails to make a decision on the complaint, the complainant ‘may’ in terms of section 109 (2) of the Act, refer the complaint to the Tribunal. Kebonang says the use of the word ‘may’ in section 109 (2) is indicative of the fact that one is not obliged to approach the tribunal for a remedy.
“That person or entity may approach the High Court directly”.
Disclosure of material facts
Zhong Gan Engineering argues that Hitecon’s rule nisi issued in this case should be discharged because Hitecon failed to disclose pre-tender minutes, policies on citizen economic empowerment, its appeal, and the revised reservation and price preference annex for citizen contractors and consultants.
On behalf of Hitecon, advocate Pilane stated that in terms of Section 108 of the Public Procurment Act, it was the rsponsibility of the Accounting Officer to notify other bidders once the complaint has been lodged. He said his client never had pre-tender minutes or documents and could not possibly have been in a position to disclose them. He said citizen empowerment documents were not critical to the application.
As a result, Justice Kebonang ruled that the Public Procurement Act does not oust the jurisdiction of the High Court to hear procurement-related disputes.
“A party has an option, once it has filed a complaint with the accounting officer to either aproach the Procurement Tribunal or the High Court for determination of any procurement related dispute,” he said in the judgement.
He added that the only local remedy that must be exhausted as a pre-requisite to approching either the Tribunal of the High Court is filing a complaint with the Accounting Officer.
