Procurement of a fence from Sarajevo to Visoko became one of the most complicated in BiH?!

Public procurement for the replacement of a damaged piece of wire fence on the Sarajevo-Visoko highway worth 2.8 million KM, which Autoceste FBiH published on December 5th 2022 was supposed to be an easy job.

However, instead of that, what occurred was a true saga, and perhaps one of the most complicated procurements in Bosnia and Herzegovina.

During the procedure, four decisions on the most favorable bidder have been brought, and each time the company Menadžer d.o.o. from Lukavac won. Every time, an appeal was filed, and all four tenders have been cancelled.

Deals and scams

Not only that. The documentation that Fokus possesses is witness that the Cantonal Court of Mostar has been involved, as well as a company from Turkey, and certain subjects accuse one another of “deals and scams”!

In the tender published at the end of 2022, Autoceste had pointed out that “because of the bad condition of the existing wire fence, it needs replacing”. This was confirmed by the investigative team of the Fokus portal.

On January 20th 2023, Autoceste FBiH made a decision to select the company Menadžer from Lukavac as the most favorable bidder. The other bidder, Sarajevo based SACOM's offer wasn't even reviewed, Autoceste FBiH states in their explanation, because this company has been disqualified for a period of two years in Autoceste FBiH's decision from September 30th 2022.

This disqualification, as it's stated, means that this company is forbidden from working as a contractor or subcontractor on all contracts where Autoceste FBiH is the contracting authority. It's interesting that SACOM's offer on the first tender was around 4.000 KM cheaper than Menadžer's.

However, on the same day that Autoceste FBiH chose Menadžer for the job, SACOM filed a complaint, and the Procurement Review Body of BiH (URŽ) accepted their appeal on March 8th 2023, which repeated the tender.

This decision made it clearer why Autoceste FBiH disqualified SACOM in the first place. This public firm submitted an act in which it is stated that SACOM was hired as a subcontractor on the subsection of the highway Počitelj – Zvirovići. The contractor on this section was the Chinese company China State Construction Engineering Corporation Limited.

Voloder’s solution

As far as SACOM is concerned, in the decision on disqualification signed by the then-director of Autoceste FBiH Elmedin Voloder, it is stated that they got the material for the fence, but the engineer on the section stated his suspicion about the origin of the installed fence because the documentation to prove that wasn't provided.

The manufacturer of that fence, as it's stated, was the Turkish company Kirac Galvaniz Telekomunikasyon from Bursa. Autoceste FBiH sent them an inquiry asking whether they provided the fence to SACOM. They replied to SACOM saying that they hadn't sent the fence to SACOM, and that their authorized representative for distribution in BiH is Buljan ceste. As it's stated further, Buljan ceste also told Autoceste FBiH that they have not delivered this product to SACOM.

Additionally, as noted in Voloder's act, Autoceste got a letter from the Turkish company not to use their products without licenses and certificates, alleging that SACOM was trying to trick Autoceste. Autoceste wrote to SACOM again, and in response got invoices from sales in Albania, a customs declaration, as well as an invoice from the factory of the mentioned Turkish factory dating back to September 2022.

However, Autoceste concluded that “all the contractors’ documents indicate that the 711 meters of the product have been bought after the installation on August 24th 2022”. Additionally, the manufacturer confirmed that the installed fence on the test section was not theirs, so Autoceste decided to disqualify SACOM for a period of two years.

SACOM considers all of this a “one-sided move by Autoceste and disqualification borne out of nothing”.

-It's clear to us that the September 30th 2022 disqualification stems exclusively from personal interest of individuals, which we will prove through legal action. Connections and personal interests of individuals from Autoceste FBiH and Buljan ceste, which we will present in court. This is proven by the signature of the contract between China State Construction Engineering Corporation Ltd with the company Buljan ceste – SACOM states in the procedure to URŽ, adding that the Turkish manufacturer did not tell the truth.

Paradoxical situation

URŽ has established, accepting the appeal from SACOM (no matter all the statements from Autoceste), that this Federal firm hasn't enabled SACOM to state their appeal. Also, URŽ has ascertained that Autoceste didn't act in accordance with the Law on Public Procurement when they declined SACOM's offer.

What followed after Autoceste FBiH's first decision on the selection of the bidder as well as URŽ's first decision on the acceptance of the appealing party can be called paradoxical.

Namely, Autoceste FBiH repeated the tender and on May 10th 2023 once again selected the company Menadžer for the procurement of the fence for the Sarajevo – Visoko section. They declined SACOM's offer once again, using the same argument – earlier disqualification. They attached an earlier decision of the Cantonal Court of Mostar which declined SACOM's appeal against Autoceste because of the mentioned situation on the Počitelj – Zvirovići subsection because the decision by Autoceste on the disqualification isn't an act to be resolved in the administrative procedure.

SACOM once again appealed to URŽ, and on July 18th 2023, they once again decided to accept their claim. The allegations from all sides were more or less identical, as well as URŽ's argumentation.

Autoceste FBiH repeated the tender on August 30th 2023 and proclaimed Menadžer as the winner once more. The position of Autoceste FBiH's director was now occupied by Denis Lasić. The same argumentation was used for SACOM, this time substantiated by Autoceste with numerous documents from the mentioned Chinese and Turkish companies, as well as e-mail correspondence of various actors, invoices, bills, even decisions by the Court of BiH on similar questions.

All of this didn't stop SACOM from appealing to URŽ again, nor URŽ to repeat their decision from before! So, URŽ on October 31st 2023 accepted the appeal from SACOM, and ordered Autoceste to publish a new tender.

Expert opinion

They did so, publishing a tender again, and choosing Menadžer as the most favorable bidder on December 11th 2023. However, taught by experience from earlier, this time Autoceste adhered closely by the Law on Public Procurement, so they didn't decline SACOM because of earlier disqualification, but because of the fact that SACOM, as they stated, didn't deliver a statement on the extension of the offer's validity period and the bank guarantee in the proposed deadline.

URŽ brought a decision on January 11th to stop the procedure because SACOM, even though they initially appealed the decision by Autoceste from December 11th 2023, decided to drop the charges.

Autoceste FBiH told Fokus that all the recommendations from the Procurement Review Body were respected, as well as other legal procedures, and that the process was, as they stated, finalized in accordance with the Law on Public Procurement.

In their answer to our inquiry, they said that SACOM doesn't have a ban on participating in public procurements undertaken by JPAC, but we didn't get any further explanation.

SACOM told us that they are not able to share any information with the public because of the ongoing processes that they started with the authorities.

Slobodan Golubović, editor of the Pratimotendere.ba portal, commented on the general work of the Procurement Review Body, saying that political and other influences on this institution are obvious in their decisions, which often make no sense.

-They often dispute their own decisions. We can frequently see that, for example, decisions of URŽ in Mostar are completely different in similar cases. This all points to the fact that URŽ's work is influenced by politics and other factors – Golubović concludes.