The procurement agency had said the contract was awarded in clear breach of the Public Procurement Act 2007.
An investigation by Premium Times has revealed how President Muhammadu Buhari and the Minister of Transportation, Rotimi Amaechi illegally approved a huge national security-sensitive maritime contract to a medical company.
The development has reportedly unsettled those in power as senior officials trade accusations of bad faith while the Bureau of Public Procurement (BPP) complained of “procedural lapses” in memos that only stopped short of directly accusing Buhari and Amaechi of lawlessness.
The procurement agency had said the contract was awarded in clear breach of the Public Procurement Act 2007.
According to one of the memos obtained by the newspaper, the International Cargo Tracking Note (ICTN) scheme is an electronic cargo verification system that monitors the shipment of seaborne cargo and enables a real-time generation of vital data on ship and cargo traffic in and out of Nigeria.
An operation of the scheme was in effect following a contract between the Nigerian Ports Authority (NPA) and an operator, TPMS-Antaser-Afrique during the Umaru Musa Yar'Adua administration, however, it was abruptly terminated by the former finance minister, Ngozi Okonjo-Iweala, in October 2011.
The controversy surrounding the termination of the contract ended up in a court of arbitration and was investigated by the Economic and Financial Crimes Commission (EFCC).
According to Okonjo-Iweala, the scheme was hurting businesses. However, the Nigerian Ports Authority argued that within the short period it was initially implemented, barely a year, more than 40 million euros were generated in revenue. It is, however, unclear if that revenue was remitted to the government in full.
Meanwhile, several years later, the government now finds the scheme desirable again. A transport ministry memo of August 26, 2021, to the Bureau of Public Procurement, says that non-engagement of the scheme would continue to cause the country loss of revenue, worsen the country’s maritime security situation, and allow alteration of cargoes and under-declaration.
According to documents obtained by the newspaper, Amaechi’s transport ministry had on September 11, 2020, sought the approval of the BPP to conduct a restricted/selected tendering exercise to engage agents or partners for the implementation of the cargo tracking note scheme.
But citing the “convoluted” circumstance of the initial contract, which attracted criminal investigation by the EFCC and the need to regain international confidence, the BPP rejected the selective tender request and, instead, asked the transport ministry to conduct international competitive bidding (ICB).
“This (ICB) was to ensure that experienced international firms with high reputation, integrity, and capacity to deliver participate in the procurement process,” BPP said in an October 22, 2020 memo justifying the need for an openly competitive process.
But “surprisingly,” the BPP noted in a memo, the transport ministry on August 26, 2021, reverted to the public procurement regulator with approval dated August 19, 2021, from the president to adopt a direct procurement in favour of MedTech Scientific Limited, a healthcare company, in partnership with Rozi International Nigeria Limited, a property development company.
Direct procurement is single sourcing of a contractor with no room for competition either in a selective exercise, which invites interests from a restricted number of companies based on experience and capacity, or an open exercise, which is publicly advertised for companies to express interest and compete.
After the October 22, 2020 letter of the BPP rejecting the selective tendering exercise the ministry of transport initially requested, Amaechi ceased further communication with the bureau until he was able to circumvent due process to obtain Mr Buhari’s approval for direct procurement, which he then communicated to the bureau on August 27, 2021.
In the period between October 2020 and August 2021, the President, in a letter dated May 17, 2021, directed that an international competitive bidding exercise be adopted in line with the BPP’s earlier position.
But Amaechi brushed aside the instructions of the president and the BPP and went ahead to have the Nigerian Shippers’ Council, where the tracking note scheme is now domiciled, commence a restricted tendering exercise extending invitations to nine companies.
This was done because of time constraints, the ministry claimed in the memo of August 27 to the BPP. Curiously, the same president changed his position afterwards and did not only authorise to use selective tendering but in favour of two named companies.
That procedure contravened Section 40(1) of the Public Procurement Act 2007 as there was no approval from the Bureau before adopting Restricted Tendering Exercise, the BPP said in two separate memos to the Chief of Staff to the President, Ibrahim Gambari, and the ministry of transportation’s permanent secretary, Magdalene Ajani.
While the restricted tendering exercise, which the BPP said was illegal, was ongoing, Amaechi decided to jettison the process and consequently “hand-picked” MedTech Scientific Limited, in partnership with Rozi International Nigeria Limited, out of the firms selected to compete for the contract.
He then sought and obtained Buhari’s anticipatory approval to engage MedTech without any competition, a development that was inconsistent with the president’s earlier directive and the public procurement law.
“This procedure is clearly against the spirit and intent of the Public Procurement Act 2007 and if challenged has the potential to embarrass the government,” the BPP said in a memo to the Chief of Staff to the President, Mr Gambari. A similar position was communicated to the transport ministry but the BPP said nevertheless it could not stop the contract given the president’s approval.
The BPP said the transport ministry did not provide the basis for picking MedTech and Rozi International to partner for the project. The ministry had said the companies selected to participate in the selective tendering process were chosen based on “proven records of experience, competency, and reliability to execute the services.”
However, according to the investigation, neither MedTech nor Rozi International had any record of success in delivering maritime traffic tracking service.
MedTech was incorporated in Nigeria in 2008 with an office in Lagos. The directors are Lifesign Healthcare Limited, a UK-registered company, Ramzi Nabil Abou-Hassan, Iyabo Rojaiye, and Kolawole Ojetimi. Abou-Hassan is a health practitioner, his Linkedin profile suggests, and the managing director of Lifesign Healthcare Limited, UK Companies House records show.
On Linkedin, Abou-Hassan said of his involvement in the coast of West Africa, which covers Nigeria, that “It is our intention to continue to leverage our experience of almost 20 years in this region to help build capacity in a very difficult environment and where the level of public healthcare has suffered much neglect for over three decades.”
On the other hand, Rozi International was incorporated in 1991 in Bauchi State, with a Wuse Abuja address, CAC records show. According to the records, the company’s nature of business is property business development, and the directors, as well as shareholders, are Robert Zeitoun, and Issam Zeitoun.
The BPP said the profiles of the two companies were not forwarded for review and therefore could not comment on their “suitability to execute a project of this magnitude and complexity.”
It is not clear if Buhari saw the profiles of MedTech and Rozi International or questioned Amaechi in this regard before granting his approval.
Despite the arbitrariness of the procurement process, the BPP said it could not stop Amaechi since he had managed to gain Buhari’s anticipatory approval. An anticipatory approval means the granting of a procurement request before the statutory consideration and endorsement of the Federal Executive Council.
Nevertheless, the BPP separately told Buhari’s Chief of Staff, Gambari, and the ministry of transport that “it is not correct” for the “exalted Office of His Excellency, Mr President, to be drawn into routine administrative approvals particularly contract-related matters that are open to litigation.”
“This procedure should be strongly discouraged,” it wrote.
The Bureau also told the Chief of Staff to advise the president to rescind his anticipatory approval granted to Amaechi to ensure an international competitive bidding exercise that is not compromised and to protect the president from embarrassment.
Meanwhile, the BPP also raised a question about the required security clearance from the Office of the National Security Adviser. The NSA had expressed security concerns in a July 16, 2021, memo.
It is not certain if both Buhari and Amaechi obtained any security clearance before approving the contract to MedTech and its partner Rozi International.
Amaechi has at various times got himself mired in arbitrary conduct around procurement processes involving agencies under his supervision, suggesting an aversion for due process.
In several contract processes involving the NPA, Amaechi inserted himself arbitrarily. In one case, he directed the NPA to restore a boat service contract with logistics giants, Intels, in disregard for an ongoing open bidding exercise in which the company had been disqualified.
In this case, the BPP intervened and submitted that Amaechi’s position could create a monopoly and leave a pattern of gaining contracts in ways other than a transparent competitive tendering process.
In addition, in the matter of NPA’s port dredging contract, Amaechi directed that contracts be extended for a year beyond original expiration dates instead of a bidding exercise, which the BPP had approved.