Wakilii

UAP Old Mutual Insurance (U) Limited v National Medical Stores [2025] UGPPDPAAT 13

Tribunal · 2025 Application Granted AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Administrative review application challenging procurement evaluation decision following dismissal of administrative review complaint by Accounting Officer
Decision
Application allowed; contract award set aside; matter remitted to Respondent for re-evaluation within 10 working days

Observed later treatment

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Holding

The Tribunal held that while the evaluation committee did not err in seeking guidance from the Insurance Regulatory Authority during bid evaluation as part of due diligence, it erred in accepting the IRA's recommendation to re-categorize trucks as tankers. The statement of requirements clearly described the vehicles as trucks for transporting LPG and oxygen cylinders, not tankers. Changing this categorization based on IRA guidance amounted to an illicit amendment of evaluation criteria contrary to section 76(2) of the Public Procurement Act. The disqualification of the applicant's bid for charging 6% (the rate for lorries) instead of 7.5% (the rate for tankers) was therefore erroneous.

Outcome

Application allowed; contract award set aside; matter remitted to Respondent for re-evaluation within 10 working days

Facts

National Medical Stores initiated procurement for comprehensive insurance cover for its assets including nine trucks modified to transport LPG and oxygen cylinders, using open domestic bidding. Six bidders submitted bids. During evaluation, the evaluation committee sought guidance from the Insurance Regulatory Authority on the applicable minimum premium rate for the trucks. The IRA recommended applying the 7.5% rate for tankers rather than the 6% rate for lorries. Based on this guidance, the Respondent disqualified UAP Old Mutual Insurance for charging 6% and awarded the contract to Sanlam General Insurance. UAP Old Mutual filed an administrative review complaint which was dismissed by the Accounting Officer on March 26, 2025. The applicant then filed this application before the Tribunal on March 31, 2025.

Issues

  1. Whether the Respondent erred in law and fact when its evaluation committee sought guidance from the Insurance Regulatory Authority regarding the evaluation criteria during the evaluation of bids.
  2. Whether the Respondent's evaluation committee erred when it disqualified the Applicant's bid on the ground that the Applicant charged 6% on trucks transporting Liquified Petroleum Gas and Oxygen contrary to the minimum rate of 7.5%.
  3. Whether there are available remedies to the Parties.

Orders

  • Application allowed.
  • Award of contract to Sanlam General Insurance (U) Ltd set aside.
  • Respondent ordered to re-evaluate bids in a manner consistent with the law and the Tribunal's decision.
  • Re-evaluation to be conducted within 10 working days from the date of the Tribunal's decision.
  • Respondent ordered to refund administrative review fees paid by the Applicant.
  • Tribunal's suspension order dated March 31, 2025 vacated.
  • Each party to bear its own costs.

Rules and key headnotes

Public Procurement — Due Diligence — Seeking Guidance from Regulators During Bid Evaluation
An evaluation committee may seek guidance or legal interpretation from a regulator during bid evaluation as part of due diligence under regulation 26(1) of the Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities) Regulations 2023, provided such guidance is sought before signing of the contract and does not result in amendment of evaluation criteria stated in the bidding document.
Public Procurement — Evaluation Criteria — Prohibition Against Amendment
Guidance from a regulator or third party obtained during due diligence in a procurement process must not be used to make any amendment, including any addition to the evaluation criteria stated in the bidding document, as an evaluation committee is barred from using any criteria other than those specified in the bidding document.
Public Procurement — Statement of Requirements — Principle of Transparency
Transparency as a cardinal principle in public procurement under section 48 of the Public Procurement and Disposal of Public Assets Act requires that categorization of items in the statement of requirements be applied without interpolation, addition or subtraction, and any attempt to stretch the meaning of terms used in the statement of requirements constitutes a breach of the transparency principle.
Public Procurement — Statement of Requirements — Precision and Clarity
Regulation 34(2) and 42(a) of the Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 require the statement of requirements to define requirements precisely and in a manner that leaves no doubt or assumption by a bidder, and categorization of items should be based on the statement of requirements without addition or subtraction.
Public Procurement — Disqualification of Bids — Unlawful Re-categorization
It is contrary to the principle of transparency and amounts to an illicit amendment of evaluation criteria for a procuring entity to disqualify a bidder who quoted a rate applicable to the category of items as described in the statement of requirements, based on a subsequent re-categorization of those items following guidance from a regulator.

Legislation cited (22)

  • Public Procurement and Disposal of Public Assets Act Cap. 205 s.46
  • Public Procurement and Disposal of Public Assets Act Cap. 205 s.48
  • Public Procurement and Disposal of Public Assets Act Cap. 205 s.76(2)
  • Public Procurement and Disposal of Public Assets Act Cap. 205 s.76(3)
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.34(2)
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.36(f)
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.42
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.42(a)
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.45
  • Public Procurement and Disposal of Public Assets (Rules and Methods for Procurement of Supplies, Works and Non-Consultancy Services) Regulations 2023 reg.59(1)
  • Public Procurement and Disposal of Public Assets (Evaluation) Regulations 2023 reg.5(1)
  • Public Procurement and Disposal of Public Assets (Evaluation) Regulations 2023 reg.5(2)
  • Public Procurement and Disposal of Public Assets (Evaluation) Regulations 2023 reg.6(1)
  • Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities) Regulations 2023 reg.26
  • Public Procurement and Disposal of Public Assets (Procuring and Disposing Entities) Regulations 2023 reg.26(1)
  • Insurance Act Cap. 191 s.12(1)(a)
  • Insurance Act Cap. 191 s.64(1)
  • Insurance Act Cap. 191 s.64(2)
  • Insurance (Minimum Premium and Maximum Commission Rates) Regulations 2023 reg.3
  • Insurance (Minimum Premium and Maximum Commission Rates) Regulations 2023 Schedule 1 item 4(2)
  • Insurance (Minimum Premium and Maximum Commission Rates) Regulations 2023 Schedule 1 item 4(3)(a)
  • Insurance (Minimum Premium and Maximum Commission Rates) Regulations 2023 Schedule 1 item 4(3)(b)

Cases cited (3)

  • Exposed Label Limited v Uganda Civil Aviation Authority (PAT Application No. 34 of 2023)
  • Lion Assurance Company Limited v Public Procurement and Disposal of Public Assets Authority (PAT Application No. 2 of 2015)
  • Gold Star Insurance Company Limited v Uganda National Roads Authority (PAT Application No. 4 of 2024)

Full judgment

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UAP Old Mutual Insurance (U) Limited v National Medical Stores 2025 UGPPDPAAT 13 (15 April 2025)
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