Attorney General warns against terminating SGS contract

Deputy Attorney General Mwesigwa Rukutana has cautioned Parliament about recommending termination of the motor vehicle inspection contract between the Ministry of Works and Societe Generale de Surveillance (SGS).

Rukutana said that a termination not following the terms of the contract would lead to payment of huge compensation and damages by government.

In March 2015, SGS, motor vehicle inspection firm, was contracted by the Works Ministry to implement the mandatory motor vehicle inspection, which attracted public criticism, resulting into a Parliamentary investigation into allegations of fraud by SGS.

A divided Committee on Physical Infrastructure would later issue reports with conflicting recommendations, with the minority report gaining most MPs’ support.

“SGS should be found culpable of peddling corrupt practices by offering inducements, offers, promises, and rewards to the employees of Ministry of Works to influence the actions of public officials during the procurement of the process,” partly read the Minority Report.

The MPs, led by MP Richard Othieno (NRM, West Budama North), had recommended the termination of the contract, but a vote on the matter was deferred pending the Attorney General’s opinion.

“We don’t find any justification to impute fraud on the part of SGS…having been cleared by the Attorney General, the contract is valid, as far as we are concerned, there is nothing in the contract that violated any provision of the constitution,” said Rukutana.

Rukutana warned that any unilateral termination of the contract by government would violate clause 7.8.5 of the agreement, which requires that “…in the event that this contract is terminated by government on any ground except as provided for in the contract, a compensation of 75 per cent of the total investment shall be paid [to SGS]”.

The Othieno recommendation singled out MP Denis Sabiiti (NRM, Rubanda West), for allegedly taking bribes to favor SGS in the contracting process, and recommended he be investigated by the Inspector General of Government.

It also accused him of using favors he allegedly granted to SGS, to secure a job with the same company after his retirement.

Mr Rukutana, however, cleared him of any wrongdoing.

In a Statement of Personal Explanation, Sabiiti strained to defend himself saying the allegations levelled against him are unfounded and were already concluded in courts of law.

“This was a subject of a court process and the court pronounced itself on the matter and I have the ruling which I want to lay on table,” said Sabiiti.

MPs criticized the contract and accused the Attorney General’s office of not conducting due diligence as provided in article 119 of the Constitution, which provides that the Attorney General shall draw, peruse and scrutinize all documents before committing government.

Oulanyah said MPs will decide on the matter during the next sitting, but cautioned against imputing fraud on the part of SGS.

“If you are saying that the contract is void, say so; what makes it voidable? The question is, what the option open to us…if there is fraud, can it be this Parliament to ascertain it?” said Oulanyah.


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