State auditor takes aim at city bus bid

State auditor takes aim at city bus bid

Bestlin 'doesn't deserve' BMTA second chance

An employee of Bestlin Group inspects parked NGV buses at a location in Bangkok in January 2017. (Bangkok Post file photo)
An employee of Bestlin Group inspects parked NGV buses at a location in Bangkok in January 2017. (Bangkok Post file photo)

The Bangkok Mass Transit Authority's (BMTA) decision to allow Bestlin Group to join a fresh round of bidding for 489 city buses threatens good governance standards in the public sector, the Office of the Auditor-General (OAG) cautioned yesterday.

The warning comes after the transport authority removed Chinese-owned Bestlin from its blacklist despite a tax-avoidance scandal involving an affiliate of the bus supplier. This clears the way for the company to take part in the new round of the bidding scheduled for next Thursday.

Super Zara Co, which handles imports for Bestlin, was accused by the Customs Department of making the buses appear as though they were manufactured in and imported from Malaysia, to reap a tax-exemption benefit based on an Asean free-trade agreement.

If the vehicles were made in Malaysia as claimed, Bestlin would be eligible for a 40% import duty exemption worth 1.2 million baht per bus.

The Customs Department suspected the vehicles were in fact produced and assembled in China.

After Bestlin failed to deliver the contractually-agreed number of buses on schedule as stipulated in the 3.3-billion-baht contract, the BMTA scrapped the contract and put the company on its blacklist.

Auditor-General Pisit Leelavachiropas said this jeopardises good governance and that his office is looking into the issue.

But he said his office will not interfere with the BMTA if that is its decision.

"The office will submit a letter asking the BMTA to carefully consider its decision and specifically the qualifications of potential bidders," Mr Pisit said.

"A company has caused damage to a state agency and the buses have not been delivered as scheduled. I think the BMTA must have received a lot of criticism by now," he said.

The BMTA is calling on the private sector to tender a bid to supply a fleet of 489 NGV buses with the median price of about 3.4 billion baht including maintenance and repair costs.

Three companies have expressed interest in competing for the contract. They are Thai Technology and Development; JVCC Joint Venture, which includes Chothavee Plc (CHO); and Bestlin Group.

Potential bidders are due to submit their terms on Aug 24 and the BMTA is expected to announce those that are qualified to compete on Sept 1. A round of electronic bidding will take place on Sept 8.

Based on the BMTA's explanation, Bestlin was taken off the blacklist because it had no intention of abandoning the contract.

Mr Pisit said the OAG is likely to dig deeper with a focus on whether the NGV buses were falsely declared, which resulted in the initial procurement scheme being scrapped.

Somsak Hommuang, deputy permanent secretary for transport, said it was his decision to write off the contract and blacklist the company when he served as the acting BMTA director.

The BMTA's legal team is waiting for Bestlin to clarify its working procedures to see why it did not complete the contract, he said.

According to Mr Somsak, BMTA deputy director Yuk Charupum, who is serving as the acting BMTA director, was the person who took Bestlin off the blacklist.

The BMTA's move has called into question the transparency of the bidding process especially as Prime Minister Prayut Chan-o-cha instructed the BMTA to procure the buses this year as a "New Year's gift for the public".

Bestlin stands a better chance than competitors of delivering the buses within 90 days given that hundreds of its NGV buses are already in the country. If the company pays the proper taxes and fines to the Customs Department, the buses are due to be released.

The BMTA has been seeking to replace its ageing buses with a new fleet of 3,183 since 2006 but all the deals have fallen through.

JVCC Joint Venture won an earlier bid before legal issues killed the deal.

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