ALP Legal Alert

Procurement Law in Uganda

By ALP Advocate
on
July 29, 2021

The Public Procurement and Disposal of Public Assets Act has been amended to provide for timely and effective resolution of public procurement disputes. The amendments became effective on July 2, 2021 and are to be implemented by both central and local government procuring and disposing entities.

The PPDA (Amendment)Act, 2021: Recent Amendments to Uganda’s Procurement Law

Introduction

In recognition of the continuously changing public procurement environment in Uganda and in an effort to make the procurement dispute resolution mechanism effective, the Public Procurement and Disposal of Public Assets Act (PPDA Act) has been amended. Originally enacted as the PPDA Act, No 1/2003,it was first substantially amended in 2011 by the PPDA (Amendment) Act, No 11/2011 (although there was a 2006amendment effected by the Local Governments (Amendment) Act, No 2/2006). The procurement law has substantially been amended for the second time by the Public Procurement and Disposal of Public Assets (Amendment) Act, No 15/2021. The amendment Act commenced on July 2, 2021 upon being gazetted in the Uganda Gazette of that date.

Briefly, the 2021 amendment Act has amended the 2003 principal Act to:

(a) Remove the Authority from the administrative review process.

(b) Provide for the appointment of a Registrar of the Tribunal.

(c) Provide for marginalized groups under reservation schemes.

(d) Provide for the powers of the High Court in procurement proceedings.

(e) Provide for the aggregation of procurement requirements.

(f) Provide for the functions of the Authority and of the Board of Directors of the Authority.

(g) Provide for the electronic records and communication.

(h) Amend the Kampala Capital City Act and Local Governments Act with respect to procurement and for related purposes.

This Legal Alert highlights key amendments effected to the PPDA Act2003 (principal Act) by the PPDA(Amendment) Act, 2021 (amendment Act).

Amendment of the Administrative Review Process

The amendment Act (section 34) repeals sections 90 and 91 of the principal Act which had provided for administrative review by the PPDA Authority. Administrative review is statutory relief availed to an aggrieved bidder for any omission or breach of the Act or regulations or provisions of a bidding document by a procuring and disposing entity.

Initially, the administrative review process had three (3) stages of review, as follows:

  • At the first stage, an application for administrative review was made to the Accounting Officer of the entity within 10 working days from the date of circumstances leading to the complaint.
  • At the second stage, the complaint was made to the PPDA Authority within 10 working days from the receipt of the notification on the decision of the Accounting Officer.
  • The third and final stage entailed lodging the application with the PPDA Appeals Tribunal within 10 working days from the date from which the decision of the Authority was made.

Notably, appeals on questions of law and fact from decisions of the PPDA Appeals Tribunal could be made to the High Court within 30 days after being notified of the decision of the Tribunal.

The amendment Act (section 34) has now done away with the second stage of administrative review by the Authority. There are only two stages now—administrative review by the Accounting Officer and by the Tribunal. A bidder who is aggrieved or whose rights are affected by the decision of an Accounting Officer can apply to the PPDA Appeals Tribunal for administrative review. In case of allegations of conflict of interest against the accounting officer or partiality by the procuring or disposing entity, the bidder applies directly to the Tribunal for determination of the complaint, omission, or breach. The aggrieved bidder must give written notice to the Accounting Officer of the intention to make an application to the Tribunal. Further, under the amendment, the Tribunal now has 15 working days to issue a decision from the date of receipt of an application for review unlike before when it had to do so with 10 working days.

As regards appeal to the High Court, the amendment Act (section41) amends section 91M of the principal Act to restrict appeals to questions of law only.

Amendment of the Functions and Powers of the PPDA Authority

One of the most consequential amendments is the change in the functions and powers of the PPDA Authority (as provided under sections 7 and 8 of the principal Act). The amendment Act (section 5) amends the functions of the Authority(as provided under section 7(1)(a) of the principal Act) to include advising procuring and disposing entities on the application of the Act, the regulations and any guidelines made under the Act.

Additionally, the amendment Act (section 6) amends the powers of the Authority, in the exercise of its regulatory function (section 8(1)(a)-(c) of the principal Act), to include the power to require information, documents, records, and reports with respect of a procurement or disposal process; call for the production of books of accounts or documents; and institute procurement and disposal contract as well as performance audits. The amendment Act further(in amending section 8(1)(e of the principal Act) gives the Authority power to investigate and act on complaints received on a procurement or disposal process from members of the public that are not subject to administrative review or review by the Tribunal.

Recognition of Electronic Records and Communication.  

The amendment Act (section 45) introduces a new provision section95B to the principal Act that permits the use of electronic records and communication (in respect of information or document) by the PPDA Authority, an entity, or a bidder during a procurement or disposal process.

This amendment is a clear manifestation of the COVID-19 times and a recognition of the existing restrictions on movements which have called for a much needed acceptance and reliance on electronic means of communication. Procurement and disposal processes can now be conducted electronically from start to finish unlike before.  

Appointment of Registrar (and other officers and employees) of the PPDA Tribunal.

The amendment Act (section 37)amends section 91G of the principal Act to require the Registrar be appointed by the Tribunal in consultation with the Judicial Service Commission. It also permits the Tribunal to appoint other officers and employees as may be necessary for the effective discharge of the functions of the Tribunal.

Procurement Regulations for Kampala Capital City Authority and the Local Governments

The principal Act provides under section 96(1) for the Minister, on approval of the Parliament, to issue regulations for the better carrying out of the objectives and functions of the Act. Under section 96(2), the Minister is also responsible for issuing regulations for procurement and disposal of a procuring and disposing entity outside Uganda.

The amendment Act (section 47)introduces a new section 96A in the principal Act to provide for making of the regulations for the Kampala Capital City Authority (KCCA) and local governments without the need for Parliament's approval but in consultation with the line Ministers for KCCA and local governments.

Implications of the amendments

  • For the most part, the administrative review process has been shortened by the removal of the Authority from the process. A typical administrative review process previously would take at least 30 working days moving from office to office with the Authority playing jury, judge and executioner at different intervals. PPDA, as a regulator, would hear applications at the second stage of the administrative review process and would be named as a respondent on appeals to the Tribunal and High Court. This is no longer the case.
  • Once a bidder is aggrieved by the decision of the entity, their first recourse is to apply for administrative review from the Accounting Officer of that entity and, if not satisfied by the Accounting Officer’s decision, the bidder should proceed to apply to the PPDA Appeals Tribunal for administrative review within 10 working days.
  • The timelines within which the PPDA Appeals Tribunal has to furnish its decision have increased from 10 to 15working days. Representatives of bidders and procuring and disposing entities need to take note of these timelines.
  • Appeals from the Tribunal to the High Court are now only permitted on matters of law (and no longer on matters off act).
  • During an appeal to the High Court, the procurement process that was hitherto suspended during the administrative review process before the Accounting Officer and the Tribunal will resume and continue despite the appeal pending before the High Court.
  • The PPDA Authority now only plays a regulatory role and does not have power to entertain and adjudge procurement disputes between aggrieved bidders and procuring or disposing entities.
  • The necessity for adoption and use of technology in the procurement process has been recognized through the acceptance of submission of documents by electronic means as may be prescribed by the entity and Authority.
  • Noteworthy, the number of members of the Tribunal (under section 91B of the principal Act) has increased from 5 to 7and at least two must be female.

Conclusion remarks

The recent amendments to the PPDA Act 2003have tactfully addressed the challenges faced by the principal legislation in management of time and unnecessary delays occasioned by the lengthy administrative review process. The PPDA Authority issued a circular on July 7,2021 directing all Accounting Officers to comply with the amendments. It is therefore important for all procurement law practitioners and prospective participants in the public procurement and disposal processes to take note of these recent developments in Uganda’s procurement law.


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Disclaimer

No information contained in this alert should be construed as legal advice from ALP East Africa or ALP Advocates or the individual authors, nor is it intended to be a substitute for legal counsel on any subject matter.

For additional information in relation to this alert, please contact the following:

  • Judith Maryanne Aboto

         Associate, Corporate& Commercial Department

        Procurement Law Expert

        jaboto@alp-ea.com