Wakilii

CFAO Motors Uganda Limited and 7 Others v The Public Procurement and Disposal of Public Assets Authority (PPDA) and 2 Others (Miscellaneous Cause JRC 7 of 2024)

High Court · [2024] UGHCCD 133 · 2024 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application for judicial review seeking to quash parts of a circular issued by PPDA relating to standard bidding documents
Decision
Judicial review application dismissed; circular remains in force

Observed later treatment

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Holding

The High Court dismissed the judicial review application challenging PPDA Circular No. 7 of 2023, which amended standard bidding documents to allow supplier/distributor authorisation as an alternative to manufacturer's authorisation for motor vehicle procurement. The court held that PPDA acted within its statutory mandate under section 8(1)(d) of the PPDA Act 2003, was not required to consult motor vehicle dealers before issuing the circular, and that the circular promoted competition and value for money rather than perpetuating illegality. No legitimate expectation arose requiring consultation.

Outcome

Judicial review application dismissed; circular remains in force

Facts

Eight applicants, comprising seven authorized motor vehicle dealers and their umbrella association, challenged PPDA Circular No. 7 of 2023, which amended the Standard Bidding Document for procurement of supplies to include supplier/distributor authorisation as an alternative to manufacturer's authorisation. The applicants, who held exclusive manufacturer authorisations for brands including Toyota, Mercedes Benz, Isuzu, Nissan and others, contended that the circular was issued illegally without gazette publication or consultation, exceeded PPDA's powers, and would allow unauthorized suppliers to participate in public procurement. PPDA defended the circular as promoting competition and value for money in accordance with its statutory mandate. The interested party, Sumabolt Logistics Limited, a supplier/dealer in motor vehicles, opposed the application arguing the circular brought fairness and competition to the procurement process.

Issues

  1. Whether the 1st respondent acted illegally, irrationally and procedurally improperly when they issued Circular No. 7 of 2023.
  2. Whether the 1st respondent's directive and/or decision contained in Circular No. 7 of 2023 is tainted with illegality, irrationality and procedural impropriety and is in violation of the principles of legitimate expectation.
  3. What remedies are available to the parties.

Orders

  • Application dismissed.
  • No order as to costs.

Rules and key headnotes

Administrative Law — Judicial Review — Illegality — Delegation of Subordinate Legislative Functions
Where an Act delegates to a regulatory authority the power to prepare, update and issue standardized documents, the authority may issue circulars to give guidance without gazetting guidelines, provided the circular supplements rather than supplants the Act and does not dilute the essence of the statutory power.
Administrative Law — Judicial Review — Procedural Fairness — Duty to Consult
In the absence of a statutory provision requiring consultation, a regulatory authority performing its operational and statutory duties such as updating standardized bidding documents is not required to consult affected service providers or give them a hearing before exercising its mandate.
Administrative Law — Judicial Review — Irrationality — Reasonableness of Decision
A decision by a regulatory authority is not irrational where it is taken to promote competition and value for money in public procurement, based on information gathered through routine compliance and performance audits, even where it affects the commercial interests of established providers.
Administrative Law — Legitimate Expectation — Requirement of Promise or Practice
A legitimate expectation does not arise in the absence of evidence that the public authority has by promise or established practice conferred an expectation of consultation. A legitimate expectation based on established practice can be invoked only by someone who has prior dealings, transactions or negotiations with the authority.
Administrative Law — Legitimate Expectation — Public Interest and Change of Policy
Where government action is taken pursuant to a change of policy in public interest based on statutory authority, it cannot be invalidated on the ground of legitimate expectation unless the action amounts to an abuse of power. Public interest and the regulator's mandate to ensure maximum competition outweigh any claimed legitimate expectation.
Commercial Law — Public Procurement — Standard Bidding Documents — Regulatory Updates
Under section 8(1)(d) of the Public Procurement and Disposal of Public Assets Act 2003, PPDA has the function to prepare, update and issue authorized versions of standardized bidding documents. Updates to standard bidding documents to promote competition and value for money fall within PPDA's statutory mandate and do not require gazetting or consultation with potential bidders.

Legislation cited (12)

Cases cited (4)

  • State of U.P v Batukdeo Pati Tripathi [1978] 2 SCC 102
  • Silver Kayondo v Bank of Uganda (HCMC No. 109 of 2022)
  • Laxmi Khandsari v State of Uttar Pradesh [1981] 2 SCC 600
  • Richard Byarugaba v Attorney General and 2 Others (HCMC No. 173 of 2023)

Full judgment

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The original judgment as reported. Read the original PDF before relying on any passage.

CFAO Motors Uganda Limited and 7 Others v The Public Procurement and Disposal of Public Assets Authority (PPDA) and 2 Others (Miscellaneous Cause JRC 7 of 2024) [2024] UGHCCD 133 (23 August 2024)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.