The ETC board announced yesterday that it has rescinded the contract signed with Swallow Garage, the garage at the centre of corruption claims, for which Transport Minister Jesmond Mugliett faced a No Confidence vote in Parliament last week. The ETC board cancelled the contract after it found that the garage had not declared the judicial cases it was facing when it applied for the contract, as it should have done.
The ETC Board discussed what was said in Parliament by the Leader of the Opposition Dr Alfred Sant last Wednesday regarding Swallow Garage and the ETC Tender for Training Services in Bus Driving (Special Licence D) awarded to Swallow Garage.
The facts of the case are the following:
On 15 May, the ETC Management published a call for tenders to acquire three types of training services:
Training Services in Driving and Operating Cranes
Training Services in Driving and Operating Forklifts
Training Services in Bus Driving (Special Licence D)
When the tenders were opened at noon of 6 June, the closing date of the call, the following tenders had been submitted:
Training Services in Driving and Operating Cranes – only one tender submitted by Swallow Ltd.
Training Services in Driving and Operating Forklifts – only one tender submitted by Swallow Ltd.
Training Services in Bus Driving (Special Licence D) – two tenders submitted – one by Swallow Ltd for Lm130 (excl. VAT) per trainee, and another by Rudolph Farrugia Driving School for Lm300 (excl. VAT) per trainee.
On the basis of this it was recommended that Swallow Ltd be awarded the contract for the three tenders.
According to Annex X attached to the offers for tender submitted by the company in its three tender documents, the company Swallow Ltd confirmed (among others) that:
“3. The tenderer has NOT been convicted of an offence concerning professional conduct by a judgement which had the force of rest judicator in accordance with the laws of Malta.”
“4. The tenderer has NOT been declared guilty of grave professional misconduct proven by any means which the contracting authorities can demonstrate.”
“8. The tenderer is NOT the subject of conviction by final judgement for one or more of the reasons listed below:
(b) Corruption, as defined in Article 3 of the Council Act of 26 May 1997 and Article 3(1) of Council Joint Action 98/742/JHA respectively.”
On the basis of all this the ETC Board of Directors approved the award of the contracts to Swallow Ltd and gave notification of the award to the tenderers by fax and by registered mail.
On the signing of the contract, Swallow Ltd had to submit to ETC a performance guarantee of Lm80 (per tender contract) equivalent to 10 per cent of the value of the contract (based on agreed minimum number of five trainees for each course, the value is Lm767 inclusive of VAT). As on Friday, Swallow Ltd had not yet submitted it.
As on Friday, ETC had not yet referred any trainees to Swallow Ltd for training based on these three contracts.
Following the reference to this case in Parliament last Wednesday, the ETC Management reopened the case on Thursday and sought legal advice as to whether there would be grounds at law to rescind or terminate the agreements entered into by the corporation with the company.
The Commissioner of Police was also invited to consider assisting ETC by furnishing a situation report related to the case. On Friday the Commissioner of Police furnished the necessary information wherein it results that the Police have arraigned Salvatore Abela (owner of Swallow Garage and of Swallow Motoring School) in court by way of citation:
before Magistrate Dr A Micallef Trigona on the 23/07/2006 charged with bribery and trading in influence (Article 120 (1), 121A (1) of the Criminal Code Cap. 9) – the case stands adjourned for the sitting scheduled to be held on 12/11/07; and
before Magistrate Dr A Micallef Trigona on the 08/02/07 charged with forgery of public documents and use thereof, false declarations to public authority and general forgery (Articles 183, 184, 188, 189 of the Criminal Code Cap 9) – the case stands adjourned for the sitting scheduled to be held on 12/11/07.
In light of the above, the ETC board considered the fact that no reference to the above facts was made by the company in the documentation accompanying the offers for tender submitted by it.
The board also considered that according to the General Conditions of Public Procurement the corporation is entitled to suspend or terminate the execution of the contracts where the award procedure or execution of the contract is vitiated by substantial errors or irregularities or by fraud, or if the company has been guilty of grave professional misconduct proven by any means which the corporation can justify. The board decided that such facts should have been declared or otherwise disclosed by the company in the documentation of its offers for the tenders. The fact itself that the owner of the company was being charged as mentioned above amounts also to professional misconduct and should have been declared by the company during the tendering process.
In view of the above, the ETC board has decided to rescind the contracts awarded to Swallow Garage.
From the above it clearly results that in no way could it be alleged that “the government is being perceived as supporting corrupt individuals, in this case by awarding contracts to persons being charged with corruption”. While the ETC board and management assume full responsibility for its actions, the ETC declares that it acted independently, in good faith and according to the laws and regulations. The ETC board and management categorically deny that any minister or the government at large was at any stage in any way involved in its decisions. ETC is constantly vigilant to prevent abuse of any sort and determined to act decisively to investigate allegations and to take the necessary measures allowed by law.