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Reserve Bank of Malawi wants judgement in K1.8 billion ICT deals suspended

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Judge Kenyatta Nyirenda

The Reserve Bank of Malawi (RBM) has applied to the High Court for the suspension of the enforcement of a judgement which ordered the retender of the K1.8 billion ATS equipment and ICT Hardware for Flexicube procurement deals.

According to a sworn statement filed at the Lilongwe District Registry on October 19 2021 by Francisco Chikabvumbwa of Mbendera and Nkhono Associates, the central bank is dissatisfied with the judgement delivered by High Court Judge Kenyatta Nyirenda on August 23 2021 for the bank to retender contracts for the supply and delivery of Lot 1, Lot 2 and Lot 3 of the ICT equipment for ATS and contract for supply and delivery of ICT equipment and Flexicube Upgrade.

According to court documents, RBM has filed a notice of appeal where it seeks to challenge in the Supreme Court of Appeal the power of the High Court to order a retender in circumstances that are tantamount to the court making a procurement decision for the bank.

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RBM argues that the retender of the two contracts, as ordered by the court, might end up being impracticable for the central bank or cause real financial and other prejudice to the bank.

“This is due to the fact that the following equipment under the ATS tender (procurement reference number RBM/ ICT/008/20) has been withdrawn from the market and cannot therefore be sold to anyone ie Storage Area Network Switch Model Number IBM San Switch SAN24B-5 and Storage Model Number IBM V7000 all flash.

“This therefore means that if any tenders are to be done by the bank, the tenders cannot exactly be the same as the initial tender in that now alternative equipment must be procured which will have different specifications,” Chikabvumbwa’s sworn statement reads.

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In its opposition to the application to suspend the judgement, the Public Procurement and Disposal of Assets Authority (PPDA), whose Review Committee is the defendant in the case, notes that, contrary to allegations by RBM, the court order to re-tender did not amount to the court making a procurement decision for the central bank.

PPDA, in a sworn statement filed by Timothy Kalembo, argues that RBM is aware that where its needs have changed due to technological advancements, the bank has to revise the specifications defined in the initial procurement and then the same will be drafted in the bidding documents so that suppliers should, when supplying the goods, comply with the revised specifications.

In his submissions, Sparc Systems Managing Director Wisely Phiri, who is first interested party in the matter, argues that any changes to the specifications will not change the nature of the tender.

“What the claimant (RBM) has wanted to procure has been the procurement of ATS as well as Flexicube equipment. This ICT equipment has got different components such as servers and switches,” Phiri says.

For ATS, Phiri says, IBM has announced replacement models for the SAN24B-5 and V7000 All Flash storage, which are SAN24B-6 and FS7200.

“If the specifications of these are changed, the nature of the ICT equipment itself will not change as the claimant is erroneously presenting,” Phiri says.

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