SME alleges sidelining in Omusati road contracts

A close corporation claiming it was sidelined after helping a company secure road construction contracts worth about N$47.5 million is now suing the company and its sole director for more than N$900 000 in the Windhoek High Court. In addition to wanting the company Kambwa Construction to be ordered to pay it about N$922 000, the close corporation Kulla Trading Enterprises is asking the court to order the Roads Authority and the review panel created in the Public Procurement Act of 2015 to bar Kambwa Construction and its sole director, David Sheehama David, from participating in public procurement proceedings for five years. Kulla Trading Enterprises is claiming its managing member, Tulonga Nghiyoonanye, and David agreed in January 2023 that Kambwa Construction would include Kulla Trading Enterprises in its bid for a road construction tender in the Omusati region. In a claim filed at the High Court in July this year, it is alleged that Kulla Trading Enterprises was included as a subcontractor in Kambwa Construction’s tender bid because the close corporation is a small or medium enterprise, owned by a woman. It is also alleged in the claim that in its tender bid, Kambwa Construction stated that more than 10% of the bid works would be carried out by Kulla Trading Enterprises and another close corporation, Oshihole Construction. In April 2023, a road construction contract to the value of N$25.9 million was awarded to Kambwa Construction. A second road construction contract, valued at about N$21.6 million, was awarded to Kambwa Construction in December 2024. Kulla Trading Enterprises is claiming that, in breach of the prior agreement between Nghiyoonanye and David, it and Oshihole Construction were excluded when Kambwa Construction carried out the construction work. As a result of the alleged breach of the agreement, Kulla Trading Enterprises claims it lost expected profits of about N$488 000 and N$434 000 on the two construction contracts. In pleas filed at the court, David and Kambwa Construction say the Roads Authority barred them from using any small and medium enterprise as a subcontractor if the enterprise was not ordinarily carrying on business or established in the Omusati region. Kulla Trading Enterprises is based in the Oshana region, according to David. Kambwa Construction also alleges the Roads Authority instructed it in June 2023 to use Omusati-based subcontractors that had been approved by the region’s governor, instead of the subcontractors proposed in the company’s tender bid. The company is denying that there was an agreement that Kulla Trading Enterprises would be used as a subcontractor, and says it “merely proposed nominating” the close corporation as a subcontractor, subject to the Roads Authority’s instructions if awarded the tender. The case has been postponed to 22 October, and is due to be referred for court-connected mediation.