Special Investigating Unit welcomes tribunal ruling to set aside Mozambique border wall tender

The Special Investigating Unit (SIU) welcomes the Special Tribunal’s ruling that has set aside the R85 million tender awarded to the ISF Shula Joint Venture for the construction of a concrete barrier wall along the KwaZulu-Natal-Mozambique border.

The wall was commissioned by the KwaZulu-Natal Department of Transport in response to community concerns about rampant cross-border crime, particularly the smuggling and trafficking of stolen and hijacked vehicles into Mozambique. Instead of delivering on this urgent public safety measure, the Joint Venture submitted fraudulent documents, failed to meet mandatory requirements, and left the project incomplete despite receiving R84 million.

The Tribunal confirmed the SIU’s investigation findings that exposed:

• Only 5.29 km of the planned 8 km wall was erected, forcing the Department to tender at an additional cost of R62 million for another company to complete the wall.
• A fraudulent B-BBEE certificate was used to secure the tender.
• An expired Letter of Good Standing.
• Non-compliance with financial capacity requirements.

The SIU investigation revealed that only 5.29 km of the planned 8 km wall was erected, with significant associated works left unfinished. The Tribunal’s ruling underscores the constitutional imperative that government procurement must be fair, transparent, competitive, and cost-effective.

The SIU will now pursue recovery of the monies paid, ensuring that public funds are restored to the state. As part of the order, ISF Shula Joint Venture has been directed to repay all profits it derived from the contract to the SIU. An independent expert will be appointed by ISF Shula Joint Venture to determine the amount of these profits. The SIU will review the findings, and if there is a dispute, the matter will be referred back to the Tribunal for determination. Furthermore, ISF Shula Joint Venture has been ordered to pay the legal costs.

This judgment validates the SIU’s investigation and sends a clear message that fraudulent certificates, misrepresentation, and incomplete delivery will not be rewarded. The SIU will continue to act decisively to protect the integrity of public procurement and restore public trust.

The SIU was mandated by Proclamation R.16 of 2021 the President. It directed the SIU to investigate allegations relating to the KwaZulu-Natal Department of Transport between 13 July 2016 and 7 May 2021, including the lawfulness and validity of the border wall tender awarded to the ISF Shula Joint Venture.

In line with the Special Investigating Units and Special Tribunals Act 74 of 1996 (SIU Act), the SIU will refer any evidence of criminal conduct uncovered during its investigation to the National Prosecuting Authority (NPA) for further action.

The SIU is also authorised to initiate civil proceedings in the High Court or a Special Tribunal in its name to correct any wrongdoing uncovered during its investigation and to recover financial losses suffered by the State, including funds paid for services not rendered.

Enquiries:
Spokesperson: Special Investigating Unit
Selby Makgotho
Cell: 083 718 6128
E-mail: SIUMedia@siu.org.za

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