Transparency International Georgia has recently published an article regarding the largest electronic procurement of the year – a tender for 100 buses announced by Tbilisi City Hall on November 4, 2013. The starting price for the tender was set at GEL 55,550,000 which during the bidding between 5 interested suppliers went down to the lowest bid of GEL 31,660,601 by a Chinese company, Xiamen Golden Dragon Bus Co., Ltd.

After the bidding process ended Tbilisi City Hall asked the lowest bidding company to update the information it provided with the EC Type - Approval Certificate, as was stated in the Article 4.4.4.1 of the tender documentation.

The company did not fulfill this request and issued a written statement saying that at the time of procurement they had the required certificates only for key bus parts and that the buses would get the certificate after the company built them.

The Georgian representatives of Xiamen Golden Dragon Bus Co are Avtandil Sakvarelidze and Badri Niauri. Avtandil Sakvarelidze, who was the former head of the oversight board of JSC Electrical Car Repair Works, has gone on record for accusing former Minister of Defense David Kezerashvili of unlawfully pressuring him to give up his share at the Georgian Carriage Builders Holding (which includes Car Repair Works) to Badri Tsilosani. Badri Tsilosani and several other Georgian Railway officials were detained in May 2013 by the Investigation Service of the Ministry of Finance on embezzlement charges, for alleged involvement in deals that resulted in damages to the Georgian Railways of GEL 65 million, according to law enforcement agencies.

Xiamen Golden Dragon Bus Co., Ltd has been disqualified by the tender commission, making another Chinese company with the second lowest bid, Zhengzhou Yutong Bus Co. LTD, the leading candidate for supplying 100 buses to Tbilisi City Hall. It is notable that the company’s bid for the tender constitutes GEL 31,660,626 which is only GEL 25 more than Xiamen Golden Dragon Bus Co., Ltd’s proposal.

Zhengzhou Yutong Bus Co. LTD has supplied the required EC type- approval certificate, however, at the time of writing this article there are still some technical issues the procurer has asked the company to resolve and clarify.

We will continue to monitor the process to ensure that the tender process will remain transparent and all issues among the supplier companies and Tbilisi City Hall will be resolved with accordance to the Law on Procurement and other relevant regulations. At this point there are no indications that the decision of Tbilisi City Hall was unlawful.

A representative of TI Georgia is a member of the Competition and State Procurement Agency’s dispute resolution board to which anybody can file complaints about electronic tenders, which are then reviewed by the board – all its decisions are then published online. You can search and monitor and sign up to email alerts about new contracts on TI Georgia’s website http://tendermonitor.ge.