Legal and Ethical Issues in BPP Debarment Proposal – A Memo By PRADIN



AttahlatestPOSITION OF PROCUREMENT OBSERVATION AND ADVOCACY INITIATIVE (PRADIN) WITH RESPECT TO THE PROPOSED DEBARMENT PROCEDURE AND COMPLAINT MECHANISM BY THE BUREAU OF PUBLIC PROCUREMENT

A. PREAMBLE
“There is an old adage that says that delay of justice is denial of justice” Also Justice Mohammed Bello, a former Chief Justice of Nigeria said in one his judgments in the Supreme Court that “Hasty or hurried justice is also a denial of justice”

There is also a presumption in law that, where there is no evidence to the contrary, things are presumed to have been rightly and properly done. This is expressed in the Latin maxim omnia praesumuntur rite esse acta. This presumption is commonly resorted to and applied especially with respect to official Acts – Shitta-Bey v AG Fed (1998) CLR 9(a) (SC).

With the above background and in responding to the public presentation on the Debarment Procedure of July 2013 by the Bureau of Public Procurement (BPP), Procurement Observation and Advocacy Initiative (PRADIN) decided to review the content of the entire submissions on Debarment Procedure. Thus this report takes into consideration every paragraph in the debarment statement or procedure or proposal as published by BPP and the resolution of the stakeholders at the Forum, as contained in the cover letter.

B. LEGAL IMPLICATION OF BPP DEBARMENT PROCEDURE
There are clear legal challenges with respect to the implementation of debarment procedure being developed because Section 6(3) of the Public Procurement Act (PPA) 2007 states that “The Bureau shall, subject to the approval of the National Council on Public Procurement (NCPP), have power to:

(a) Enter into contract or partnership with any company, firm or person which in its opinion will facilitate the discharge of its functions;
(b) Request for and obtain from any procurement entity information including reports, memoranda and audited accounts, and other information relevant to its functions under PPA (This include reports required for debarment investigation and implies that BPP must have the Council in place before documents for debarment investigations and decision can be obtained from MDAs); and
(c) Liaise with relevant bodies or institutions, national and international for effective performance of its functions under the Public Procurement Act 2007.

Secondly, we are convinced that due to the nature of the anticipated crime(s) on the debarment issue, a hasty or hurried implementation of the process based on Debarment Procedure learnt from different countries in African region, the World Bank, African Development Bank, European Bank etc, without relating the experience to procurement environment in Nigeria, by applying the Constitution and other relevant laws, it can lead to great injustice and deprivation of avoidable human rights abuses.

C. UNDERSTANDING DEBARMENT
The word “Debar” as in the current situation means the placing of a firm company or natural person on a list of person ineligible to participate in any procurement proceedings under the PPA 2007. This process is not the same with exclusion of a contractor as contained in Section 16(8) of PPA which deals with the removal of name from a particular tender process based on certain ground(s) specified in the PPA or administrative review of procurement proceedings as contained in Section 54 of PPA.

If BPP relies on Section 6 (1) (e) and 6(1) (g) of PPA and ignoring Section 58, Debarment under this situation is still illegal because the entire Sections 6(1) (e) and 6(1) (g) of PPA must apply together with Sections 6(1) (d), which inevitably will lead to Section 53 of PPA on how to conduct criminal review and surveillance before recommending for criminal investigation. There is the need to first establish a case that will lead to criminal prosecution, involving charges, arraignment, plea taking etc. All these actions can only occur in courts processes and which may lead to conviction or eventual debarment by BPP. It is a legal requirement that the Administrative Review in section 54 of PPA expect that BPP comply with Sections 2, 7, 8, 16(1) etc of PPA, to avoid an order of Citeriori from the Federal High Court, after a decision.

PRADIN is convinced based on the aforementioned facts that the trial and conviction of a person or company by a competent and properly constituted Court, as contained in Section 58(2) of PPA is the only constitutionally guaranteed way to prove guilt for an offence of violation of PPA and thus the only ground for the imposition of debarment by BPP as a punishment or penalty as contained in Sections 6 and 58 of PPA.

Thus PRADIN is of the strong position that the imposition of the penalty of debarment for violating any part of the PPA without a court trial, and on the basis of an indictment for these offences by a BPP officials or the proposed Investigating Committee or Sanctions Board implies a presumption of guilt, contrary to Section 36(5) of the Constitution of the Federal Republic of Nigeria, 1999.

We noted with special concern the position of BPP relying on Section 6(1) (e) which confers on the BPP, the power to debar contractors and section 6(1)(e) to publish list of debarred contractors. The section however is short of informing us, as stated above, that a debarment cannot take place, without following the procedures in Section 6(1)(d) of PPA which states that “debarment may only take place after a review or inspection of records”. Section 6(3) also specify that BPP need the approval of the Council before calling stakeholders to a debarment process, meeting and to obtain, records, reports, etc from MDAs for the purpose of Debarment. It is a settled principle of interpretation that a provision of the Constitution or a statute should not be interpreted in isolation but rather in the context of the Constitution or statute as a whole. Therefore, in construing the provisions of a section of a statute, the whole of the statute must be read in order to determine the meaning and effect of the words being interpreted

PRADIN is of the view that once there is a violation of any Section of PPA by a contractor, it becomes an offence against the state and therefore must be tried in a Court of law where the complaints of BPP or his accusers can be ventilated and where all parties would be sure of getting fair hearing. An indictment by BPP after investigation by EFCC, ICPC, and Police etc is merely a charge which must be proved at trials in court beyond reasonable doubt before any defendant may be convicted. No other Tribunal, Investigating Panel or the proposed BPP Sanctions Committee or Board has this legal authority.

Here again, we reasoned, and it is a matter of fact that if the debarment procedure as proposed by BPP is not challenged, the judicial powers of the courts could be absorbed by BPP and the Office of the Attorney General of the Federation and Minister of Justice, an organ of the Executive branch of the Federal Government.

D. COMPOSITION OF THE SANCTION BOARD
With reference to the composition of Sanctions Board, it is important to state that in considering whether there is a real likelihood of bias, in any matter before the court, the court does not look at the mind of the justice himself or at the mind of the chairman of the tribunal, or whoever it may be, who sits in a judicial capacity. It does not look to see if there was a real likelihood that he would, or did, in fact favour one side at the expenses of the other. The court looks at the impression which would be given to other people. If he could be impartial as could be, nevertheless, if right-minded persons would think that, in the circumstance, there was a real likelihood of bias on his part, then, he should not sit. And if he does sit, his decision cannot stand.

Now the Attorney General of the Federation is the Chief Law Officer of Nigeria with the powers to undertake criminal proceedings against any person before any court of law in Nigeria other than a court-martial in respect of any offence created by or under any law of the National or State Assembly; to take over and continue any such criminal proceedings that may have been by any other authority or persons; and to discontinue at any stage before judgment is delivered any such criminal proceedings or undertaken by him or any other authority or person.

Here there is a clear case of conflict of interest. The Director General of BPP is the one expected to complain about contractors, together with MDAs and recommend for debarment after conduct of initial investigation or review before sending same to EFCC, ICPC or the Police for criminal investigation. The responsibilities of the Secretary of the Sanctions Board which is proposed to be the Director General of the Bureau to become a voting member include (1) scheduling of all Committee meetings and hearings relating to debarment proceedings; (2) briefing the Committee members on all aspects of a matter; (3) assisting the Committee during its deliberations; (4) drafting the Committee’s written decision pertaining to each matter brought before the Committee, as directed by the Committee; (5) performing other duties assigned to the Secretary in these Procedures; and (6) assisting the Committee in other ways not inconsistent with these Procedures.

It is interesting to know that even under the World Bank Debarment System and any other transparent processes around the world, the Secretary of the Debarment Committee is usually prohibited from involvement in any matter before the Committee in which the Secretary had prior substantive involvement, and an Acting Secretary who has not had such prior substantive involvement is appointed by the Committee to perform the duties of the Secretary for the matter.

The ISSUE from the above facts will be how will the Attorney General of the Federation and the DG of BPP serve in the Debarment Sanctions Board whether as voting or non voting members, and debar a contractor without being seen as biased?. The other members of the board as proposed are not also clear what they represent. For example, it will interest the public to know how a representative from that sector will emerge. Will the nomination be based on capacity or political? These ISSUEs are relevant in view of the technical nature of the proposed debarment.

E. REVIEW OF THE BPP PROPOSED DEBARMENT PROCEDURE
The BPP three-stage debarment procedures as published are as follows:

Stage 3 – Sanctions Board – 5 members that makes final decision based
on BPP recommendations
Stage 2 – BPP Investigating – Analyse Debarment proposal and evidence,
Committee issue notice of intention to debar, conduct hearing, forward recommendations to Sanctions Board
Stage 1 – MDAs – Approve recommendations, forward
debarment proposal to BPP

E. DETAILS OF THE 14 STEPS DEBARMENT PROCEDURE PROPOSED BY BPP
Below are extract from the BPP’s fourteen (14) steps procedure for the Debarment:

The Bureau shall commence the process of Debarment of Supplier, contractor or Service Provider, a) if it has cause during its reviews to believe that a Supplier, Contractor or Service Provider has contravened any provision of the PPA and regulation made pursuant to PPA 2007.

The Bureau shall commence the process of Debarment of Supplier, contractor or Service Provider, b) when a procuring Entry following adequate investigation submits a debarment recommendation approved by its accounting officer with convincing evidence; or c) where it is proven that the Accounting Officer withholds recommendation of the investigation panel of an MDA, the Bureau will Act on a submitted copy duly endorsed by all members of the panel as submitted by Director of procurement.

1. The Bureau shall acknowledge receipt of all proposals for debarment within 14 days of receipt to the Procuring Entry that reported the matter.

2. The Bureau shall within 21 days analyze the information received, including any further information/documents, it may require from the Procuring Entity that has submitted debarment proposal.

3. Once the ground for debarment is established a notice of intention to debar is issued to the supplier, contractor, consultant or service provider in ISSUE. Such notice should be issued within thirty (14) days after conclusion of investigation or analysis. The notice must state the grounds for the intended debarment, the reasons thereof, the intended period of debarment as well as the terms attached to the debarment, including prohibition from furnishing any advice or rendering intermediary services to federal procuring entities by such firm.

4. The supplier, contractor, consultant or service provider to be debarred is issued with the notice in order to afford her a reasonable opportunity to respond thereto.

5. The respondent is granted a period of fourteen days (14 days) from the date of the notice, within which to respond.

6. A notice of intention to debar is dispatched by courier to the address furnishing by the firm or any person, or fax or electronically to the address of the supplier, contractor or service provider proposed for debarment. The supplier or service provider may submit in writing or through their counsel, information, in opposition to the proposed debarment, including any additional specific information that raises a genuine dispute over the material facts and any mitigating circumstances.

7. Upon receipt of response the Bureau consider such response within 14 days and makes recommendation to the Sanctions Board for consideration

8. In cases where no response is received, the Bureau will only make a recommendation to the Sanctions Board if satisfied that proof of delivery of service exists. However, If the dispatch notice is returned or there is no proof of delivery, then the notice of intention to debar is published in at least two national dailies the Bureau of public procurement’s website, newspaper, tenders journal and notice board for not less than 14 days. The notice must state the grounds for the intended debarment, the reasons thereof, the intended period of debarment as well as terms attached to the debarment, including prohibition from rendering advice or rendering intermediary services to FGN Procuring entities by such firms.

9. Where response is received the Bureau will take it into consideration and make recommendation(s) to the sanction board within 14days for consideration. However where no response is received, the respondent, will be considered to have been fully served and the Bureau will proceed based on the material facts available and makes recommendation to the sanctions board

10. Where response is received the Bureau will take it into consideration and make recommendation(s) to the sanction board within 14days for consideration. However where no response is received, the respondent, will be considered to have been fully served and the Bureau will proceed based on the material facts available and makes recommendation to the sanctions board

11. Bureau will then issue a notice of debarment, where the decision of the board is to debar. Such notice will be, within 7 calendar days from the receipt of Sanctions Board decision. The notice must refer to the notice of intension to debar , state the grounds of debarment, the reasons, thereof( description of the reasons for debarment in sufficient detail) , the period of debarment, which shall not be less than 5 years as contained in section 58(6)(a) Of PPA, as well as date of commencement.

12. Where debarment is not imposed by sanctions board, the Bureau shall within 7 calendars days from the date of receipt of the sanctions board decision ,notify the supplier, contractor or service provider and lifts the suspension, placed on such supplies/ consultant/contractor as placed on the contractor

13. The name of the debarred contractor, consultant or service provider is then placed on the data base of BPP and published on the Bureau’s website for public viewing.

14. The Supplier, contractor or service provider may appeal to the Federal High Court within 30days after the receipt of the notice of debarment, if not satisfied with the decision to debar

F. ISSUES AND ISSUES ARISING FROM THE ABOVE STAGES AND PROCEDURES

To address each of the anomalies in the proposal for the three-stage and procedure for the debarment, we would take the issues one after the other.

ISSUE No 1 – The Title
Whether there is a difference between a Debarment Process and Debarment Procedure?

PRADIN COMMENT
Our professional understanding is that Debarment Procedure is the specified way(s) to perform certain debarment activities while Debarment Process is a set of interrelated resources (human and financial) plus Debarment Activities (DA) that transforms Debarment Inputs (DI) into Debarment Outputs (DO). By this, Debarment Output thus means the result of debarment activities in a Debarment process. In other words, Debarment activity means “a component of debarment process having significant debarment function and resources and designated as such by regulations or law and constitute part of the set of interrelated process that translates into debarment inputs and debarment output”. These include debarment referrals, notices and service, investigation by relevant agencies, hearings, record of proceedings, discovery, judgment and reports etc. Therefore, our position is that the PPA 2007 does not recognize Debarment Procedure but Debarment Process.

ISSUE 2 – The Council on Procurement
Pursuant to Section 6(1)(a) of PPA, whether BPP has the power to enforce the monetary and prior review thresholds that is not set by the NCPP for the application of the provisions of PPA by the procuring entities, which will be used as basis for debarment?

Our answer here is capital NO, and our arguments are contained in Section 6 (1) (a) of the Public Procurement Act 2007.

ISSUE 3 – BPP as a Quasi-judicial Body
We need to ask if the BPP as set up by law is a quasi judicial body.

If the answer to the above is YES, then it is important to know if a not properly constituted Quasi-judicial body can have jurisdiction to adjudicate on issues concerning deprivation of fundamental human rights

OUR ARGUMENT – Jurisdiction is the authority of a Court or a Quasi-judicial body to decide matters before it. The BPP being a quasi-judicial body is required by law to have jurisdiction before commencing any Debarment hearing and/or before prosecution for debarring, and this implies that:

(a) BPP must be constituted according to the provisions of the Act
(b) Any condition precedent to its exercise of jurisdiction must have been fulfilled;
(c) The subject matter of the case must be within its jurisdiction; and
(d) The case or matter must be brought to the BPP by due process of the law.

ISSUE 4 – Criminal Proceedings and Investigations
Whether a debarment, criminal proceedings or process can amounts to criminal investigation?

PRADIN COMMENTS
In all criminal cases and debarment allegations (as may result from the violations of the provision of PPA), investigation plays an important part, and it will make or mar subsequent criminal or debarment proceedings, but that does not qualify as being part and parcel of “proceedings” The Police, EFCC, ICPC and other anti-corruption bodies’ investigation of a criminal or debarment allegation is not and cannot be regarded as criminal or debarment proceedings so as to qualify as the “proceedings” mentioned under Section 308(1) of the 1999 constitution.

ISSUE 5
Whether the BPP policy on debarment should be approved by the BPP and some selected stakeholders and does has power to stipulate a Code of Conduct for all public officers, suppliers, without the approval of Council?

PRADIN COMMENT
NO. Please see Sections 2, 5, 6(3) and 16 of PPA 2007.

ISSUE 6
Whether a legal person charged to court for violation of any provision of the PPA is an accused person charged with having committed a criminal offence.

PRADIN COMMENT
Yes, an accused person is a person against whom a criminal charge is preferred or a person against whom any sentence is imposed and includes a person liable to an order for recognizance or to keep the peace. See Section 58 (1) – (3) and 58 (6) of PPA

ISSUE 7
Whether any natural person not being public officer who contravenes any provision of this Act commits an offence and is liable on conviction to a term of imprisonment not less than 5 calendar years but not exceeding 10 calendar years without an option of fine.

PRADIN COMMENT
Yes, see Section 58 (1) of PPA

ISSUE 8
Whether any legal person that contravenes any provision of this Act commits an offence and is liable on conviction to a term of imprisonment not less than 5 calendar years but not exceeding 10 calendar years without an option of fine or a cumulative penalty of (a) Debarment from all public procurements for a period not less than 5 calendar years; and (b) A fine equivalent to 25% of the value of the procurement in issue

PRADIN COMMENT
Yes, see Section 58 (6) of PPA

ISSUE 9
Whether any offence in contravention of the PPA shall be tried by the BPP or a Federal High Court?

PRADIN COMMENT
The answer here is ‘Yes, by the Federal High Court AND NOT BPP’. The BPP is only permitted by law to conduct Administrative Review (Sections 54) and/or a review before debarment in accordance with Section 6 of PPA as well as with Section 58 of PPA.

ISSUE 10
Whether, where a legal person is convicted, every director of the company as listed on It’s records at the Corporate Affairs Commission (CAC) shall be guilty of an offence and liable on conviction to a term of imprisonment not less than 3 calendar years but not exceeding 5 calendar years without an option of fine

PRADIN COMMENT
Yes, see Section 58 of PPA

ISSUE 11
Whether any natural person not being public officer who contravenes any provision of this Act commits an offence and be liable to a cumulative penalty of (a) Debarment from all public procurements for a period not less than 5 calendar years; and (b) A fine equivalent to 25% of the value of the Procurement in issue

PRADIN COMMENT
Yes, see Section 58(6) of the PPA

ISSUE 12
Whether strict compliance with a mandatory requirement relating to the procedure in a criminal trial is a pre requisite of a valid Debarment trial?

PRADIN COMMENT
Yes, strict compliance with a mandatory requirement relating to the procedure in a criminal trial is a pre requisite of a valid DEBARMENT TRIAL, and where BPP or a trial judge proceed to try an accused person without strictly compliance with the provisions of Section 215 of the Criminal Procedure Law, and Section 33(6)(a) of the Constitution, the DEBARMENT TRIAL may be declared a nullity by an appellate court.

ISSUE 13
Whether failure to comply with mandatory rules of court can renders Debarment proceedings null and void?

PRADIN COMMENT
Yes, the provisions of sections 314 and 323 of the Criminal Procedure Act are mandatory and failure to comply with them renders the committal and debarment of an accused person a nullity. Substantial Compliance may however suffice if the objective of the rules is not defeated by failure to strictly comply with them.

ISSUE 14
Whether an investigating Police, EFCC or ICPC Officer is bound to disclose his/her source of information?

COMMENT
An Investigating Police, ICPC or EFCC Officer is not bound to disclose his/her source of information. This is contained in the Evidence Act – which states that “No magistrate or police officer shall be compelled to say whence he got any information as to the commission of any offence.”

G. OTHER ETHICAL ISSUES
On the statement that the Bureau shall commence the process of Debarment of Supplier, Contractor or Service Provider, if it has cause during its reviews to believe that a Supplier, Contractor or Service Provider has contravened any provision of the PPA or when a procuring entity following adequate investigation submits a debarment recommendation approved by its Accounting Officer with convincing evidence or where it is proven that the Accounting Officer withholds recommendation of the investigation panel of an MDA, the Bureau will act on a submitted copy duly endorsed by all members of the panel as submitted by Director of procurement. Here are some issues to ponder upon:

a. Whether the BPP is legally capable of establishing a Prima facie case against a bidder or contractor to commence debarment proceedings in court –

ANSWER – No, the BPP is a party to debarment process. It is the duty of Police, ICPC, EFCC or other bodies to establish a case against offender(s).

RECOMMENDATION – The law is that once there is a statutory procedure, to carry out review, such procedure must be followed to the letter. The term prima facie case was defined in the case of Ajidagba v. Inspector-General of Police (1958) SCNLR 60 following the Indian case of Sler Singh v. Jitend-dransthen (1931) ILR 59 Cale, 275 to mean that there is ground for proceeding in a criminal matter and this cannot be done by one of the parties to the suit, it is important to note that prima facie case is not same as proof which comes later when the Court (not BPP) has to establish whether the accused is guilty or not guilty and “the evidence discloses a prima facie case when it is such that if un-contradicted and if believed it will be sufficient to prove case against the accused.

b. What happens when the National Assembly receives a Procurement Audit Report for review, or when they carry out investigation, in accordance with Section 88 and 89 of the Constitution and recommend the debarment of a contractor?

RECOMMENDATION – The above simply proves that debarment cannot be left to BPP and MDAs, alone, for transparency, even civil society organizations should not be denied the right to complain and recommend fraudulent contractors for debarment or exclusion.

c. Pursuant to Section 6(1) (d) of PPA, whether BPP has the power to cause to be inspected or reviewed any procurement transaction to ensure compliance with the provisions of the PPA without following the procedure in Section 53 and 54 of the Act.

The answer here is NO again. Section 53 and 54 of the PPA clearly explains this.

CONCLUSION
In concluding this submission, we will like to make some statements to guide BPP’s review of this Special Memo. It is important to note that the reviews by PRADIN are done purely with a patriotic intention as they borders on jurisdictions. Therefore it must be noted that the jurisdiction of BPP to carry out surveillance, review is not to be equated with powers of the EFCC, The Police, ICPC or other anti-corruption bodies to carry out criminal investigation. Where there is jurisdiction to carry out review, surveillance and determine if there is violation of the PPA, the power of BPP is the authority to make certain orders and decisions with respect to the matter reviewed or under surveillance, following the procedure specified by law in Sections 2, 7, 6, 53, 54 and 58 of PPA.

And pursuant to section 16(8) and 60 of PPA, there is a difference between a Contractor, consultant, supplier – Exclusion Procedure and Debarment Procedure under the PPA. While exclusion is administrative review, Debarment is a criminal proceeding.

On account of Section 16(8) of PPA both the BPP and MDAs can exclude but none of the two can debar. Section 16(8) states that whenever it is established by a procuring entity or the Bureau that any or a combination of the situation set out below exists, a bidder may have its bid or tender excluded from any particular procurement proceeding if:

(a) There is verifiable evidence that any supplier, contractor or consultant has given or promised a gift of money or any tangible item, or has promised, offered or given employment or any other benefit, item or a service that can be quantified in monetary terms to a current or former employee of a procuring entity or the Bureau, in a attempt to influence any action, or decision making of any procurement activity;
(b) There is verifiable evidence that any supplier, contractor or consultant has given or promised a gift of money or any tangible item, or has promised, offered or given employment or any other benefit, item or a service that can be quantified in monetary terms to a current or former employee of a procuring entity or the Bureau, in a attempt to influence any action, or decision making of any procurement activity;
(c) A Supplier, Contractor or consultant during the last three years prior to the commencement of the procurement proceedings in issue, failed to perform or to provide due care in performance of any public procurement;
(d) The bidder is in receivership or is the subject of any type of insolvency proceedings or if being a private company under the companies and Allied Matters Act, is controlled by a person or persons who are subject to any bankruptcy proceedings or who have been declared bankrupt and or have made any compromises with their creditors within two calendar years prior to the initiation of the procurement proceedings;
(e) The bidder is in arrears regarding payment of due taxes, charges, pensions or social insurance contribution, unless such bidders have obtained a lawful permit with respect to allowance, deference of such outstanding payments or payment thereof in installments.
(f) The bidder has been validly sentenced for a crime committed in connection with a procurement proceeding, or any other crime committed to gain financial profit;
(g) The bidder has in its management or is in any portion owned by any person that has been validly sentenced for a crime committed in connection to gain financial profit;

There is a judicial error in consideration of Section 58(6) (a and b) of PPA, because BPP is not authorized to reduce the prescribed sentence by law “shall not be less than 5 years only” and omit “and a fine equivalent to 25% of the value of the procurement in issue”. The sentence as prescribed by law is cumulative penalty of: (a) Debarment from all public procurements for a period not less than 5 calendar years; and (b) A fine equivalent to 25% of the value of the procurement in issue. The reduction in the sentence by BPP cannot be justified under whatever circumstances.

END OF SUBMISSION
September 2013.
Procurement Observation and Advocacy Initiative (PRADIN) is a select group of non-state actors trained under the World Bank-Federal Government of Nigeria (FGN) Economic Reforms and Governance Project (ERGP) and registered under Part C of the Corporate Affairs Commission (CAC).

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