Bidders for public contracts not obliged to file annual accounts
Matthew Vella A Finance Ministry spokesperson has declared that companies tendering for government contracts, are not required to file their audited accounts with the Malta Financial and Services Authority.
It is a surprising declaration in the wake of news that the company Polidano Group, which has not filed its accounts for public scrutiny since 2006, is being recommended for a €7 million EU-funded contract for constructing a submarine outfall at Ta’ Barkat, in Xghajra.
The ministry reacted to MaltaToday’s story last Sunday that two Polidano companies had not yet filed their most recent annual returns – as required by law for all registered companies – and were still in the running for two major EU-funded public works contracts.
According to the tender advert, bidders must supply evidence of “financial and economic standing”, as per a 2005 legal notice that demands proof that the company has enough cash and access to credit facilities to carry out the contract.
This must be confirmed by a financial statement for the years 2006, 2007 and 2008 verified by a certified accountant.
“Nowhere is there any obligation for bidders to have their accounts filed with the Malta Financial Services Authority,” the finance ministry spokesperson said.
As things stand, the submarine outfall tender has not yet been awarded. Four other bidders were disqualified, while Polidano Group, together with its foreign partner Etermar SA, is the only bidder who qualified for the final stage. A notice in this regard was published and all bidders informed individually of this decision.
But a right of appeal costs €35,000 for aggrieved bidders to contest the decision by the Contracts Department.
“No appeal was received by the department. On 19 January, the General Contracts Committee proceeded with the opening of the third package of the only compliant tenderer… the Evaluation Committee adjudicated strictly by the published conditions and specifications. If any bidder was convinced that arbitrary decisions were taken he should have availed himself of the legal remedies provided for in the Public Contracts Regulations,” the spokesperson said.
In a letter to MaltaToday (page 22), a Polidano representative stated that the accounts submitted for the submarine outfall at ta’ Barkat “were signed and certified by a certified public accountant and thus in full conformity with the tender requirements.”
Another company under the same umbrella, Polidano Brothers, is also being recommended for another EU-funded, €12 million contract for the civil refurbishment works for the Marsaxlokk Breakwater.
Again, evidence of financial standing is required for 2006, 2007 and 2008.
But the company last archived its accounts with the MFSA on 27 February, 2004.
“It seems clear now that companies that do not abide by their legal obligations to deposit their audit financial statements with the MFSA, are on the same standing as companies that fulfil their obligations,” a legal counsel to a company with an interest in the tenders, said.
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