Court throws out NamPower BEE suit

September 23, 2014, 11:44am

Court throws out NamPower BEE suit

THE High Court of Namibia has dismissed an urgent application in which a Swakopmund company was challenging NamPower over a N$30m tender.

Premier Construction CC had dragged NamPower to court after losing the tender to Ama Engineering and Construction CC, saying the parastatal used black economic empowerment, decentralisation and rural development as the basis for awarding the contract.
Ama Engineering has contracts to buy and supply several types of machinery and equipment. Judge Collins Parker heard the urgent application on 22 August and delivered his judgment on Wednesday.
The company was questioning the legality of the process to award the tender to Ama Engineering CC; wanted the High Court to set aside the awarding of the tender; and to declare any agreement between NamPower and Ama Engineering invalid.
Premier Construction also wanted NamPower and the respondents to pay its legal costs in the case, but Judge Parker said Ama Engineering would suffer damages should the contract be set aside because it has started implementing work after the site was handed over on 6 August, with work expected to be completed within three months. 
The judge also said the company has already contracted subcontractors to provide services and has also entered into financial arrangements with banks to be able to finish its contractual obligations.
According to the Judge, Ama Engineering has also been submitting weekly reports, indicating progress of work done to NamPower. 
Justice Parker also ruled that Premier Construction CC could not prove that NamPower violated the firm's constitutional rights by awarding the contract to Ama Engineering. He was also of the opinion that it is rather Ama Engineering who will suffer losses and not Premier Construction CC.
Premier Construction CC went to court because it believed that NamPower did not follow internal procedures when it awarded the tender, and that its own tender bid was 25% lower than that of Ama Engineering. 
Ama Engineering's tender bid was for N$29 million, while Premier Construction quoted N$23 million. Another tenderer, Emirates Trading, which is also listed as a respondent, submitted a tender quote of N$34,6 million.
The Namibian reported that the NamPower board of directors had to step in to prevent the tender from being awarded to Premier Construction because it believed the internal tender committee was not fair to Ama Engineering. 
The tender committee allegedly presented to the board its decision to award the tender to Premier Construction.It had stated that all three shortlisted companies had the same technical score. 
The board then assessed the three bidders' profiles based on decentralisation and rural development. It was concluded that Ama Engineering from Outapi is the closest to the site, at a distance of less than 100km. Emirates, based at Ongwediva, is second in terms of proximity compared to Premier, which is based in Swakopmund.

By Tileni Mongudhi The Namibian