Tender to Chinese builder under attack

A TENDER Board decision to award an almost N$75 million contract for the building of a new head office for the Ministry of Lands to a Chinese construction company survived an attack on its legality in the High Court on Friday.

The issue of the urgency – or not – of the legal challenge that two local construction companies mounted against the award of the tender to a Chinese competitor, China Nanjing International (Namibia) (Pty) Ltd, tripped up their attempt to have the High Court set aside the award of the tender and declare it as in breach of the Constitution and a number of Namibia’s laws. Not convinced that the aggrieved construction companies Namibia Construction and Murray and Roberts (Namibia) complied with the requirements of the High Court rules for cases to be heard as a matter of urgency, Judge Louis Muller on Friday dismissed the application that the companies had filed against the Chairperson of the Tender Board, the Minister of Works, Transport and Communication and China Nanjing International (Namibia) in a bid to have the award of the Land Ministry head office construction contract to China Nanjing overturned.Namibia Construction and Murray & Roberts (Namibia) also tendered to construct the new Lands Ministry head office.The Tender Board however decided on September 21 to award the tender to China Nanjing at a sum of some N$74,4 million.Namibia Construction and Murray and Roberts (Namibia) were notified of this in writing on September 27.By October 8, their lawyers first wrote to the Permanent Secretary of the Ministry of Works, threatening legal action of the award of the tender to China Nanjing was not stopped.The playing field in the construction industry in Namibia is not level when it comes to what is legally required from Chinese and other construction companies in Namibia, Namibia Construction and Murray & Roberts (Namibia) claimed in support of their challenge to the award of the tender.”It has become common knowledge that Chinese contractors operating in the Republic of Namibia do not regard themselves to be subject to the laws of this country and to that end have been allowed to break the law with impunity,” Karl-Heinz Schultz, Co-chief Executive Officer of Namibia Construction, stated in an affidavit that was filed with the court as part of his company’s case.Companies tendering on State construction projects have to meet a set of legal requirements, Schultz stated.This includes providing proof of registration as a Namibian tax payer, a certificate of good standing from the Social Security Commission, a valid affirmative action certificate issued by the Employment Equity Commission, and proof of compliance with the Labour Act, which includes that the company should be a party to the collective agreement concluded between the Construction Industries Federation of Namibia (CIF) and the Metal and Allied Namibian Workers Union (MANWU), according to Schultz.Schultz claimed that China Nanjing has expressly been identified as one of a number of Chinese construction companies that have not been registered with the Employment Equity Commission and that have not submitted reports required by the Affirmative Action (Employment) Act.China Nanjing is also not a member of the CIF and as such not a party to the collective agreement between the CIF and MANWU, which is one of the express requirements stipulated in the tender for the construction of the new Lands Ministry head office, Schultz further alleged.He stated in his affidavit: “Notwithstanding the fact that the Government has threatened and criminally charged various Namibian entities for not complying with the provisions of the Affirmative Action (Employment) Act, it is apparent that (China Nanjing) has been enjoying preferential and unequal treatment vis-à-vis its Namibian counterparts which has now been endorsed by the award of (the Lands Ministry head office tender).”By awarding the tender to China Nanjing, he claimed, the Tender Board “has placed the State in a position whereby it will conclude a contract in breach of the laws of Namibia”.In another affidavit, the Permanent Secretary of the Ministry of Finance, Calle Schlettwein, who is also the Chairperson of the Tender Board, claimed that the tenders submitted by Namibia Construction and Murray & Roberts (Namibia) both did not comply with Tender Board requirements.Namibia Construction failed to submit a certificate of good standing regarding tax compliance issued by the Ministry of Finance’s Directorate of Inland Revenue, and used its own, computer-generated forms instead of the required form of documents in its tender, Schlettwein stated.Another technicality also counted against the tender submitted by Murray & Roberts (Namibia), he indicated.Murray & Roberts (Namibia) did not comply with the tender conditions “when it also used its own stationery in preparing its Bills of Quantities”, Schlettwein stated.The two companies “have made very serious allegations and conclusions about Government, (China Nanjing) and other Chinese contractors without any factual basis,” he declared.These allegations are denied, he indicated, but more time than has been given in the urgent timeframe in which the case was taken to court would be needed to consider the claims and respond to it.Senior counsel Adrian de Bourbon, assisted by Albert Strydom, represented the two construction companies in their challenge to the tender.Gerson Hinda and Natasha Bassingthwaighte represented the Tender Board and Minister of Works, while Pieter Henning, SC, and Andrew Corbett appeared for China Nanjing.Not convinced that the aggrieved construction companies Namibia Construction and Murray and Roberts (Namibia) complied with the requirements of the High Court rules for cases to be heard as a matter of urgency, Judge Louis Muller on Friday dismissed the application that the companies had filed against the Chairperson of the Tender Board, the Minister of Works, Transport and Communication and China Nanjing International (Namibia) in a bid to have the award of the Land Ministry head office construction contract to China Nanjing overturned.Namibia Construction and Murray & Roberts (Namibia) also tendered to construct the new Lands Ministry head office.The Tender Board however decided on September 21 to award the tender to China Nanjing at a sum of some N$74,4 million.Namibia Construction and Murray and Roberts (Namibia) were notified of this in writing on September 27.By October 8, their lawyers first wrote to the Permanent Secretary of the Ministry of Works, threatening legal action of the award of the tender to China Nanjing was not stopped.The playing field in the construction industry in Namibia is not level when it comes to what is legally required from Chinese and other construction companies in Namibia, Namibia Construction and Murray & Roberts (Namibia) claimed in support of their challenge to the award of the tender.”It has become common knowledge that Chinese contractors operating in the Republic of Namibia do not regard themselves to be subject to the laws of this country and to that end have been allowed to break the law with impunity,” Karl-Heinz Schultz, Co-chief Executive Officer of Namibia Construction, stated in an affidavit that was filed with the court as part of his company’s case.Companies tendering on State construction projects have to meet a set of legal requirements, Schultz stated.This includes providing proof of registration as a Namibian tax payer, a certificate of good standing from the Social Security Commission, a valid affirmative action certificate issued by the Employment Equity Commission, and proof of compliance with the Labour Act, which includes that the company should be a party to the collective agreement concluded between the Construction Industries Federation of Namibia (CIF) and the Metal and Allied Namibian Workers Union (MANWU), according to Schultz.Schultz claimed that China Nanjing has expressly been identified as one of a number of Chinese construction companies that have not been registered with the Employment Equity Commission and that have not submitted reports required by the Affirmative Action (Employment) Act.China Nanjing is also not a member of the CIF and as such not a party to the collective agreement between the CIF and MANWU, which is one of the express requirements stipulated in the tender for the construction of the new Lands Ministry head office, Schultz further alleged.He stated in his affidavit: “Notwithstanding the fact that the Government has threatened and criminally charged various Namibian entities for not complying with the provisions of the Affirmative Action (Employment) Act, it is apparent that (China Nanjing) has been enjoying preferential and unequal treatment vis-à-vis its Namibian counterparts which has now been endorsed by the award of (the Lands Ministry head office tender).”By awarding the tender to China Nanjing, he claimed, the Tender Board “has placed the State in a position whereby it will conclude a contract in breach of the laws of Namibia”.In another affidavit, the Permanent Secretary of the Ministry of Finance, Calle Schlettwein, who is also the Chairperson of the Tender Board, claimed that the tenders submitted by Namibia Construction and Murray & Roberts (Namibia) both did not comply with Tender Board requirements.Namibia Construction failed to submit a certificate of good standing regarding tax compliance issued by the Ministry of Finance’s Directorate of Inland Revenue, and used its own, computer-generated forms instead of the required form of documents in its tender, Schlettwein stated.Another technicality also counted against the tender submitted by Murray & Roberts (Namibia), he indicated.Murray & Roberts (Namibia) did not comply with the tender conditions “when it also used its own stationery in preparing its Bills of Quantities”, Schlettwein stated.The two companies “have made very serious allegations and conclusions about Government, (China Nanjing) and other Chinese contractors without any factual basis,” he declared.These allegations are denied, he indicated, but more time than has been given in the urgent timeframe in which the case was taken to court would be needed to consider the claims and respond to it.Senior counsel Adrian de Bourbon, assisted by Albert Strydom, represented the two construction companies in their challenge to the tender.Gerson Hinda and Natasha Bassingthwaighte represented the Tender Board and Minister of Works, while Pieter Henning, SC, and Andrew Corbett appeared for China Nanjing.