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Bill banning ‘dirty contractors’ from public tenders going to plenum

Auditor general Odysseas Michaelides

A bill banning companies from bidding for public contracts will be going to the plenum this week, the House watchdog committee decided on Tuesday.

Despite having received the final draft from the government only days ago, MPs have agreed to fast-track it along with the accompanying ordinances, watchdog committee chair Giorgos Georgiou said.

This Thursday’s plenary session is the last before parliament dissolves ahead of next month’s elections.

Under the legislation, companies that have been proven in court to have bribed their way into securing public contracts, or whose cadres have admitted to as much without any court proceedings, will be blacklisted and prohibited from bidding for a period of up to five years.

The new regulations apply to all contracting authorities of the civil service and the broader public sector.

Speaking in parliament, Auditor-general Odysseas Michaelides urged MPs to pass both the bill and the regulations, saying these are matters for which the public expects the state to take action.

The legislation provides for the establishment of an ‘Exclusion Committee’ which will review cases of contractors suspected of bribery or misconduct.

The attorney-general and the auditor-general will attend the committee with observer status.

Also, where a company believes to have been unfairly excluded from tendering, it will have the right to mount an appeal with the administrative court.

Michaelides opined that the Exclusion Committee’s composition ensured the body would take the best possible decisions.

It’s understood the five-member committee will be chaired by the Treasurer of the Republic (who will have the casting vote), the permanent secretaries of the ministries of justice, energy and transport, and either an attorney proposed by the Bar Association or a former Supreme Court judge.

In the event the fifth member is a lawyer, the regulations stipulate – as an additional safeguard – that he or she must never have represented a contractor before the Tenders Review Authority (TRA).

Responding to a question, Michaelides said he was not unduly concerned with the prospect of blacklisted companies dissolving and reforming under a different name, since in all likelihood the new company would lack the technical know-how to undertake building projects.

But as reported by Politis, the legislation contains a loophole, where a blacklisted contractor may still be awarded a tender if this is deemed to be in the public interest – for instance if no other contractors are capable of fulfilling a project.

One example of how outfits implicated in misconduct were able to stay in the running for public contracts relates to Nemesis, a construction company.

Last year the Department of Public Works excluded Nemesis, implicated in the Paphos Sewerage Board (SAPA) scandal, from a tender involving the construction of a road connecting the port of Limassol to the Limassol-Paphos highway.

Nemesis subsequently challenged the decision with the TRA, which on this April 4 ruled in the company’s favour, partly on the grounds that the company’s involvement in the SAPA affair dates back a considerable length of time.

The legislation blacklisting companies regained traction in the wake of the SAPA scandal but also the more recent waste management affair involving the landfills in Marathounda, Paphos, and Koshi, Larnaca.

Twelve persons have so far been indicted in the waste management case.

In a related development, Cypriot police were expected on Tuesday to take into custody Theofanis Lolos, a Greek national and director of ENVIROPLAN SA, the firm which provided consultancy services to the government for the waste management tenders.

The contracts were awarded to Helector, a Greek outfit at the centre of the affair.

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