Hitachi calls for recusal of PCRB members over 'irregular' €600 million incinerator tender

Sean Montebello - 22. November. 2023

Japanese multinational corporation Hitachi Zosen has asked for the recusal of two Public Contracts Review Board members in a Wednesday hearing about an “irregular” tender awarded to a consortium between construction company Bonnici Brothers and the French waste management company Paprec.

Through lawyers Matthew Paris and Adrian Delia, at a PCRB hearing on Wednesday morning, Hitachi asked that board Chairman Kenneth Swain and board member Vincent Micallef recuse themselves over claims of conflict of interest.

The Environment Ministry awarded the €600 million tender for an incinerator facility at Magħtab through the Department of Contracts after “mistakenly” divulging sensitive financial information about the bidders while negotiations were ongoing.

The French Paprec Energies consortium, in which Bonnici Group has a 40% stake, secured the recommended bidder status for the construction and operation of the plant for 20 years, beating two other final bidders.

Malta’s Bonnici Group is the only Maltese shareholder among the bidders.

According to an application submitted to the board within the first few minutes of the hearing’s start, the conflict exists given Swain and Micallef are board members of companies managed by the Environment Ministry, which awarded the contract, called “irregular” by Hitachi.

The application claimed that Swain is a board member at the Water Services Corporation and Clear Flow Plus Inc. Micallef is a board member of Enemalta Plc. and Mediterranean Offshore Bunkering Company Ltd.

Part of the application submitted by Hitachi to the board asked for the recusal of its chairman and another member over claimed conflicts of interest.

The objection to the contract was filed last month by the Japanese multinational and claimed that the government had “irregularly published the ‘non-binding’ financial offers by some of the bidders” during the ongoing process, “an irregularity, which has the effect of distorting competition and preventing a fair process”.

Additionally, Hitachi also claimed that the recommended bidder, the Paprec/Bonnici consortium, “cannot sustain [their submitted price] with the mandatory technical requirements specified in the tender, or alternatively will sustain the price, by offering a solution not compliant to the tender specifications.”

Hitachi also said its offer was given lower marks than deserved by the evaluation committee to sway the procurement process in favour of the recommended bidders.