Bank of Uganda v Public Procurement and Disposal of Assets Authority (Civil Appeal No.018 of 2020) [2024] UGHCCD 29 (25 January 2024)

# THE RE,PUBLIC OF UGANDA IN THE HIGH COURT OF UGANI)A AT KAMPALA (crvrL DrvrsroN)

## CML API'U,AL NO. ltl ()F'2020

(Arising liom PPDA Appcals'l'ribunal Application No. 02 o12020)

BANK OF UGANDA APPE,LLANT

#### VF]ITSI. JS

PUBI-IC PROCUREMENT AND DISI'OSAL OF PUI]LIC ASSE,TS AUTHORITY RF],SPONDENT

## Beforc: Thc Hon .lusticc Michacl Elubu J udgmc n t

'l'his is an Appeal which was filed by the Bank ol Uganda against The Public Procurement and Disposal of Public Asscls Authority. It arises from the decision of the Public Procurement and Disposal Appcals 'l'ribunal in Application No. 2 of 2020. The appeal was lodged on the 6th of Fcbruary 2020.

#### Backgrou nd

On the l2tr'olJuly 2019, the appellant, Bank ol'LJganda, initiated a procurement for the provision of a Security Information and Ilvcnt Management Solution (SIEMS)

and invited bids. It was indicatcd that the bidding would be in accordance with the open intemational bidding method as contained in the Bank of Uganda Procurement and Disposal of Assets Manual 201 7. Bids closed on the 201h of August 20 1 9.

Among the companies that submitted bids was Mantra Technologies Ltd in joint venture with Infigo IS D. O. O. On the 18'h of November 2019, when the appellant disptayed the results of the l'echnical Evaluation Notice, it indicated that Mantra Technologies Limited in joint venture with Infigo IS D. O. O was unsuccessful on account of faiiure to meet the technical requirements ofthe bid.

Mantra Technologies Ltd in joint venture with Infigo IS D. O. O., the unsuccessful bidder, sought administrative review by the Governor of the appellant citing irregularities in the tender. The application was madc under Section 90 of the Public Procurement and Disposal of Assets Act, 2003.

On the 281h of November 2019, the appellant's Governor wrote to Mantra Technologies Limited in joint venture with Infigo IS D. O. O. in response to the application, and detailed the reasons for its disqualification.

In response to the appellant's letter ofthe 281h of November 20219, the unsuccessful bidder filed an application for adminislrative revicw by the respondent. On the 101h ofDecember 2019, the respondent gavc notice ofthe application to the appellant and instructed the appellant to suspend thc procurement process. The appellant was instructed to send the entire procuremcnt file to the rcspondent for review.

The respondent fixed a hearing of the matler on the 17th of December 2019 and invited the appellant to attend. The appellant did not attend the hearing nor did it transmit the procurement file. As a result, the respondent conducted an Ex Parte hearing of the unsuccessful bidder.

The respondent wrote to the appellant giving an outline of the submission made by the unsuccessful bidder. 'lhe appellant was granted an opportunity to respond to the submission in writing.

On 20'h December 20 I 9, the (lovernor Ilank of Uganda wrote to the respondent stating that the said procuremcnt proccss is categorizcd as a procurcment in exercise of the Bank's mandate under Scction 4 of the Bank of Uganda Act. That the SIEMS was aimed at ensuring end to end cvent tracking and remediation for all events especially targeting the Banking and Paymcnts infrastructure in the Bank's effort to ensure a sound and secure financial systcm. That thc procurement was therefore outside the PPDA Act. lJe madc a requcst that the Bank is left to proceed and complete the tender proccss to avoid any undesircd incidents.

On the l0'h ol January 2020, lhe respondent wrote to the appellant notilying it that its Board of Directors at thcir mecting of thc 91r' January 2020 considered the Application for Administrative Review and the bank's submissions and found that:

- I . 'Ihe bid notice dated I 21r' July 2019 in respect to the procurement and the bidding document issucd indicated that the bidding process was conducted in accordancc with the Open lnternationat Bidding Method contained in the Bank of Uganda Procurement and Disposal of Assets Manual 2017 - 2. 'l'he use of the Bank ol'Uganda Procurcment and Disposal of Assets Manual 2017 that has nevcr becn accredited by the Authority is contrary to the PPDA Act 2003. Scction 40A ofthe PPDA Act 2003 providcs that an Entity that is not able to comply with a particular procurement or disposal procedurc may apply to the Authority for accrcditation of an altcrnative systcm. Where the system is accredited, the tintity submits a Manual containing thc system which are approved and accredited by the Authority.

- 3. The procuremcnt conducted under the Bank of Uganda Procurement and Disposal of Assets Manual 2017 not accredited by the Authority is null and void. - 4. Reference to Seclion 4 of the Bank of lJganda Act was not applicable in the context of the procurcment.

Being dissatisfied with the decision of the respondent, the appellant lodged an Application (appeal) on the 24'h of January 2020, with thc Public Procurement and Disposal of Public Assets Appeals Tribunal, against the respondent.

At the hearing by the PPDA Appeals Tribunal, the Respondent raised a preliminary objection that the Appellant does not subjcct itself to the jurisdiction of the PPDA Tribunal by virtue of stating that the PPDA Act does not apply to the impugned procurement process.

On the 6th of February 2020, the PPDA Appeals Tribunal delivered its Ruling in favour ofthe Respondent and issued orders that:

- 1. The preliminary objection was overruled. - 2. The Application was dismissed. - 3. The decision of the Authority was affirmed. - 4. That until parliament enacts a law to regulate procurement and disposal activities of the Bank ofUganda carried out in exercise of its functions under Section 4 of the Bank of Uganda Act, Act Cap. 5 1 , the Authority is directed to liaise with the Bank of Uganda to propose Regulations to be issued by the Minister of Finance Planning and Economic Development under Section 96 (1) of the PPDA Act 2003 to regulate procurement and disposal activities ofthe Bank under Section 4 of the Bank of Uganda Act Cap. 5 <sup>1</sup>

5. Each party to bcar its own costs

Following the decision of the PPDA Appeals'l'ribunal, the Appellant lodged this Appeal by fiting a notice ofappeat on the 27'h ofFcbruary 2020.

A memorandum of appeal with the fbllowing six grounds of Appeal was filed subsequently:

- 1. The Tribunal erred in law in holding that the Appellant's 2017 Manual isultra vires the PPDA Act and is therefore null and void to the extent of that inconsistency. - 2. The Tribunal erred in law in holding that the Appellant is subject to the jurisdiction of the PPDA whether it's a PDE in some instances and not a PDE in others. - 3. The l'ribunal erred in law and lact in holding that the Appellant should have sought the advice of thc Respondcnt in coming up with the exempt list under Schedule 6 to the Manual. - 4. l-he Tribunal crred in law and fact in holding that thc Appellant should have sought the advice of the Respondcnt on whether procurement of SIEMS lalls under the exempt [ist. - 5. The Tribunal crred in law in holding that until Parliament makes a law to regulate the Appcllant's procurcmcnts relerred to under Section 3 (h) ofthe PPDA Act, thc Appellant as a Ccntral Govcmment Institution falls under the

jurisdiction of the Authority when the Authority is exercising its functions underScctionT(l).

6. The 'l-ribunal erred in law and in l-act when it all'trmed thc Respondent's decision in its lcttcr dated l0'h January 2020 in rcspect of the Administrativc rcv lcw.

### Submissions

The parties were granted leave to lllc writtcn submissions. These submissions shall not be reproduced herc but they have becn studied and shall be referred to in resolution of all the questions in dispute here.

## Prcliminary Objection

The Respondent raised a preliminary objection that this Appeal was filed out time. That it was therefore incompetent and ought to bc dismissed. The respondent argued that an appeal is a creature of statute and the appellant must comply with atl the conditions prescribed in the statutc crcating thc right of appeal.

The respondent submiftcd that thc appellant did not comply with the requirement in Section 91M otthe PPDA, 2003 which requircs that an appeal shall bc lodged within thirty days after being notified of thc decision of the Tribunal or within such time as thc Fligh Coun may allow.

Additionally, that Section 79 (1) (a) of thc Civil Procedurc Act also stipulates that except as otherwise specifically provided in any other law, every appeal shall be entered within thirty days of the date of thc dccree or ordcr of the court. That this Section adds in subsection (2) that in computing the period of limitation prescribed,

the time taken by the lower Court in making a copy of the Order or Decree appealed from and thc proccedings upon which it is founded shall be excluded.

1-he respondent also argues that Order 43 Rule I of thc Civil Procedure Rules SI 7l-l requircs cvery appeal to the l-Iigh Court to bc preferred in the lorm of <sup>a</sup> Memorandum. That instituting an appeal by way of notice of appeal is irregular.

'fhe Appellant's rcply to this preliminary point was that the proper procedure should have been to file an application to strike out the appeal. l'hat such an application would havc allowcd thc appellant to respond by adducing evidence by way of an affidavit.'l'hat the Appellant complied with Section 9lM of the PPDA Act 2003 when it lodged a notice of appeal.

The appellant also argues that that the PPDA Act 2003 is silent on the time within which an appeal must be lodged to the High Court and Section 79 ( I ) of the Civil Procedure Act relied on by the Respondent deals with appeals from decrees or Orders of Courts. It is therefore inapplicable in these circumstances.

That Section 2 (b) of the Civil Proccdure Act dcfincs a Court as any Court exercising civiljurisdiction. 'l'hat the decision of thc PPDA 'l'ribunal is a decision of an administrative or quasi-judicial authority. That the PPDA l'ribunal exercises other jurisdiction conferred by the PPDA Act and does not sit as a Court. It follows that an appeal to the I{igh Court from a dccision of the tribunal is not a judicial appeal.

### l)cte rmination

This court is in lull agrcement with the submission of the respondent that it is the established law that an appeal is a creature ol statutc, and a court can only exercise appcllate jurisdiction where that jurisdiction is given by such statute. A party who seeks to avail himself or herself of the right of appeal must strictly comply with the conditions prescribcd by the statute. (Rcfcr to thc dccisions of Hamam Singh Bhogal T/a Hamam Singh & Co. vs Jadva Karsan (1953) 20 EACA l7 as cited in Emmanuel Tumusiime vs Perusi Namagembe HCCA 42 ol2013).

'l-his is an appcal arising lrom a dccision of the PPDA Appeals tribunal. Such appeals are regulated by Section 9lM of thc PPDA Act 2003 which states:

(l) A party to procccdings beforc the Tribunal who is aggrieved by the decisions of thc 'l'ribunal, may, within thirty days after being notified of thc decision of thc 'l'ribunal or within such furthe r time as the I Iigh Court may allow, lodge a notice of appeal with the registrar of thc I.ligh Court.

The decision of the PPDA Appeals l'ribunal was issued on the 6tr'of February 2020. On the 24'h of February 2020, the Appellant wrote to the Acting Registrar of the PPDA Appeals Tribunal requesting for a certified copy of the Record of proceedings. On the 27th of Irebruary 2020,Lhe Appellant lodged a notice of appeal, against the Ruling of the Tribunal, in this Court.

The provision creating a right ofappeal in this case is unambiguous. An appeal from <sup>a</sup>decision of the tribunal is instituted by filing a Notice of Appeal within 30 days of being notificd of the decision. 'fhc appellant was notified of the decision on the 6'h of February 2020 and filed its Noticc of Appeal on the 27th of the same month. That was a period of 2l days and well within time.

In light ofthat I see no reason to consider the issue ofwhether this is an appeal within the meaning Judicature Act as thc statute is unequivocal regarding the manner and time within which an appeal should be filed.

The preliminary objection is accordingly overruled.

'l'his court will now consider the merits of the appeal. ## Ground 4

4. The Tribunal errcd in law and fact in holding that the Appcllant should have sought thc advicc of thc Rcspondcnt on whether procuremcnt of SIEMS falls under thc cxcmpt list.

This court is under a duty as a first appcllatc court, to subject all the evidence to <sup>a</sup> fresh scrutiny and arrive at its own conclusions.

It was submitted lor the appcllant that under Artictc 162 (2) of the Constitution of the Republic ofUganda, the appellant shall not be subject to the direction and control of any person or authority in the cxercisc ol its functions. The tribunal therefore erred when it made its decision on the SIIIMS because it was unconstitutional, null and void. The casc of M Buwule vs Asuman Mugenyi SCCA No. 36 of 2019, in which the Supreme Court held that in ordcr to succeed in a prayer to set aside <sup>a</sup> judgement, thc applicant must prove that it is null and void was cited. The appellant contends the decision of the respondent was null and void.

It was the contcntion of the appellant that when the rcspondent concluded that relerence to Section 4 of The Bank of Uganda Act was not applicable in the context ofthe manual it gavc no reason for that finding.

The appellant argued that thc SIIiMS is critical lor sccuring the appellant's network through which transactions in thc e-govcrnment systcm are processed. Additionatly, it hosts critical banking applications and payment systems such as EFT, RTGS SWIFT messaging, the Flex Cubc Core Ilanking System and Automated Clearing Housc. It was stated that this inlormation was indicated on the bidding document.

The appellant's contention was that thc procurement of the SIEMS was therefore in exercise of the appellant's flunctions in Scction 4 of thc BOU Act and specifically in its functions ofa banker to governmcnt and financial institutions, agent in financial

matters for govemment, and a clearing house for cheques and other financial instruments lor financial institutions.

The respondent's submissions, in reply, was that thc Bank of Uganda is a procuring and disposing entity in respect of its procurement activities save for those that fall under Section 4 of the IIOU Act.

That the SIEMS cannot be catcgorised as a procurement under Section 4 of the BOU Act because the record of procecdings shows that the purpose of the SIEMS solution was meant for real time threat detection and automatcd response and other services. Essentially it is a system that collects data and provides reports and alerts regarding the various systems operated by the appellant.

The respondent contends that thc PPDA Act only excmpts procurements which fall under Section 4 of the BOU Act. Otherwise that Section 40A of the PPDA Act provides for accreditation of altemative procurements systems where an entity cannot comply with the PPDA Act. I1 states that in such instances the entity may apply for an altemative system.

The respondent states that thc procuremcnl was not therefore conducted in accordance with the PPDA Act.'I'hat the use of the appellant's procurement manual materially altered provisions ol the PPDA Act and should have been accredited. Because it was not accredited, the procurement conducted in accordance with The Bank of Uganda Procurement and Disposal Manual 20 1 7, was null and void.

That as was held in Gallcria in Africa vs Uganda E,lectricity Distribution Company Ltd SCCA 8 of 2017 the PPDA Act must be adhered to strictly for all public procuremcnts.

## Rcsolution of Ground 4

This was the root ofthe dispute in thc first place. The appellant, The Bank ofUganda, had on the I 2'h of July 201 9, invitcd bids for the suppty of a Security Information and Event Management Solution (SIUMS). Mantra 'l'echnologies I-td in joint venture with Infigo IS D. O. O. was unsuccessful in its bid. When as an unsuccessful bidder they applied for administrativc review, the matter went all the way to the PPDA Appeals tribunal.

The bid document indicated in the introduction to the'l'echnical specifications that the bank intended to acquire and implcment a Sccurity Information and Event Management (SIEM) solution. 'l'hat the system was aimed at providing real time threat detection and automated rcsponse, alerting, remediation and to support security and operations response. It would also support IT operations.

The appellant indicated that thc solution would operate on the Bank of Uganda computing network comprising of a primary site with the cight branch networks connectcd to the primary site.

This court looked up additional information on SIEMS. The IBM website had <sup>a</sup> description of a SIEM given at https://www.ibm.com/topics/siem. It states:

"SIEM is a security solution that hclps organizations recognize potential security threats and vulnerabilities before they have a chance to disrupt business operations. It surfaccs user behaviour anomalies and uses artificial intelligence to automate many of the manual processes associated with threat detection and incident rcsponse and has bccome a staple in modern-day security operation ccntres (SOCs) for sccurity and compliance management USC CASCS

From the spccification, and this additional information, it is clear that the appellant intended to implement a rcal time security solution across its cntire operation and

functionality. lt would opcralc lrom and bc hosted on the cxisting Bank of Uganda Network.

It would at this stage be imperativc to examine what these functions are.

The appellant is creatcd under Articlc l6l of The Constitution of the Republic of Uganda with functions set out in Articlc I 62 ( I ). Scction 4 of The Bank of Uganda Act operationalises the Constitutional provisions.

For the avoidancc ofany doubt, I shall reproduce Section 4 ofthe BOU Act which stipulates as follows:

(l)'Ihe functions of the bank shall bc to formulate and implement monetary policy directed to economic objectives of achieving and maintaining economic stability.

(2) Without prejudice to the gcncrality of subsection ( I ), the bank shall,

- (a) maintain monetary stability; - (b) maintain an external assets rcserve; - (c) issue currency notes and coins; - (d) be the banker to thc Govcmment; - (e) act as financial adviser to thc Government and manager of public debt;

(f) advise the Governmcnt on monetary policy as is provided under section 32(3);

(g) where appropriate, act as agcnt in financial matters for the Government;

(h) be the banker to financial institutions;

(i) be the clearinghouse for chequcs and other financial instruments for financial institutions;

() supervise, regulate, control and disciplinc all financial institutions and pension funds institutions;

(k) where appropriate, participate in the cconomic growth and development programmes.

During the hearing when the matter camc up at the Tribunal, an officer of the appellant, Lorna E. Karungi, gave additional information on what the SIEMS is and its relationship with the functions olthc appcllant. She stated as follows (see pages 8-9 ofthe tribunal record ofproceedings):

Under S.4 of the Ilank of Uganda Act, Ilank of Uganda is a banker to the Government and also acts as an agent where appropriate will act as an agent in financial matters for the Govcrnment and then will be the banker to the financial institutions and also the clearing housc for cheques and other financial instruments for financial institutions.

Before, banking was conducted in thc banking hall even cheques were cleared in the banking hall but by the time this ac1 was passed in 2014 for Bank of Uganda to start complying, the banking and financial intermediary activities were online. 'l'herefore, the banking hatl is the network of the bank.

'Ihe instructions come onlinc, thcy go to the various commercial banks online, that's why in that Schedulc 3, we included when are carrying out those lunctions we showed that the supply and maintenance of specialized ICT systems for central banking such as R'I'GS, CSD, RI'GS is used in transferring Government and Banking payments lor privatc individuals, CSD is the central security deposit for trading treasury bills and treasury bonds, SWIFT for enabling messages, electronic funds transfer and related information security systems, disaster recovery, business rcsumption and security systems related to the Bank of Uganda network.

When thc Govemment paymcnt transactions or any transaction is going through the banking system, therc is need lor alerts of the Accounting Officers of the Banks of the individuals to ensure that every entity knows when there is any transaction on their bank account. Also to prevent hacking we do encryption of the messages so that the hacker is not able to read that is why we included them herc. To carry out those functions, it's on the network of the bank.

All the foregoing shows that the SIEMS will provide the electronic online cloak of security and monitoring of the operations of the appellant. From the explanation given by Karungi, it is clear that the appcllant exccutes a number of its core statutory functions, such as being a banker to govemment or acting as the clearing house, online.

When the tribunal examined this matter, it stated that the evidence adduced on the SIEMS was inadequate and could not enable it make a decision on whether the SIEMS was part of the core functionality of the appellant. It therefore determined the matter by examining whether the BOU Procurement manual, under which the procurement was made, was legal.

This court respectfully disagrees with the tribunal in this regard. The bid documents, the law and the statements given by the appellant's officers in attendance at the tribunal were sufficient for this issue to be satisfactorily resolved.

In order to execute its core statutory lunctions, the bank utilises an online network. The online network is a tool to efficiently deliver on the mandate provided for in Section 4 of the BOU Act. That network is vulnerable and must be secured in real time. My understanding is that the SIEMS is deployed to provide that protection. On that ground alone evidence that thc SIIIMS goes to fortifo the core statutory functions of the appellant is sufficient.

It is my finding based on the forc going that SIIIMS falls under the exempt list of the appellant procurements.

For that reason, the 4'h ground ol appcal succeeds.

Resolution of Grounds of Appeal.

(irounds 2 & <sup>5</sup>

- 2. The Tribunal crrcd in law in holding that thc Appellant is subject to the jurisdiction of thc PPI)A whcthcr it's a PI)Fi, in some instances and not <sup>a</sup> PDE in others. - 5. The Tribunal crrcd in law in holding that until Parliamcnt makes a law to rcgulatc thc Appcllant's procurcmcnts rcfcrrcd 1o under Section 3 (h) of thc PPDA Act, thc Appcllant as a ccntral govcrnmcnt institution falls under the jurisdiction of thc Authority whcn thc Authority is cxcrcising its functions undcr Scction 7 ( I ).

When arguing these two grounds, thc appellant stated that under Section 3 of the PPDA Act, 2003, the legislature specifically excluded the application of the ppDA Act when the Appellant was cxcrcising its functions spccified in Section 4 of the Bank of Uganda Act.

T'he respondent in its reply argued these two grounds jointly with the rest of the grounds ofappeal. That is Grounds 2, 3, 4 and 5;

It was submitted for the Respondent that on the basis of Sections 2 ( I ) (c) and 3 of thc PPDA Act 2003, the Bank of Uganda is a procuring and disposing entity in respect of its procurement and disposal activitics except those in the exercise of its functions specified in Scction 4 olthc Bank ofUganda Act. It is therefore subject to the PPDA Act 2003 to the extcnt that it is not exercising functions under Section 4 olthe Bank ofUganda Act.

That in addition to the above, Section 7 (l) of thc PPDA Act 2003 stipulates the functions of the Respondent is to advise all government procuring entities on public procurement and disposal policies, principles and practices.

That as pan of this mandate, the Respondent as a Regulator is authorised to advise the Appellant in its procurement and disposal activities including the establishment of the list of procurements which fall within the ambit of the PPDA Act 2003 and thosc which lall under Section 4 of the Bank of Uganda Act (where the Applicant is not a procuring and disposing entity and therelorc not subject to the PPDA Act 2003).

The respondent also asserts on ground 3 that thc tribunal rightly held that the appellant should have sought the advice of the appellant on which activities are exemptcd. That such advice would havc dctermincd whether the SIEMS falls under the list of exemptions.

## Determ ination

In resolving these grounds this court will start with the provisions of the law regulating procurements initiated by thc appcltant. 1'hc long title of the PPDA Act 2003, stipulates inter alia that it is an Act to rcgulatc practices in respect of public procurement and disposal activities and othcr connccted matters. In Section 2 (l) (a) the Act states that it shall apply to all public procuremcnt and disposal activities and in particular to all public finances ofa procuring and disposing entity.

1'he procuring and disposal entitics arc sct out in Scction 3 olthe PPDA Act. In sub section 3 (h) Bank ofUganda is defined to bc a procuring and disposing entity except in exercise of the functions specified in scction 4 of the Bank ofUganda Act.

l'his is an express provision of the [aw. I have also notcd that the Constitution ofthe Republic of Uganda provides in Articlc 162 (2) that that in performing its functions, the Bank of Uganda shall conform to this Constitution but shall not be subject to the direction or controI of any person or authority.

Putting these two provisions in context, it would appear that the intention was to ensure that when the appetlant was exercising any of its core functions, including procurement decisions related to its functions, thcn its independence was to be saleguarded and preservcd.

In its decision the PPDA tribunal held that Section 3 (h) was not to be read in isolation of Section 7 ( <sup>I</sup>) of thc PPDA Act which states that the functions of the respondent include advising all procuring and disposing entities on principles and practices ofprocurement. It was argued that for that reason, then the all procurements irrespective of whether the fatl under Scction 3 (h) PPDA Act, are subject to the jurisdiction of the respondent in as far as receiving advice on procurements is concemed. That the appellant could not therefore make a determination exempting the tendering of the SIEM solution from thc PPDA without first seeking the advice of the respondent.

It should be noted that both the PPDA Act and the Constitution are concise and unequivocal in expressing the extent of thc statutory and constitutional mandate of both parties. And when dealing with intcrpretation of statutory provisions, the Supreme Coun held in Constitutional Appeal No. 0l of 2015 Hon. Theodore

Ssekikubo And 3 Others vs Thc Attorncy Gencral & others that,

The first and cardinal rule of statutory interpretation is that where words are clear and unambiguous, thcy should be givcn their primary, plain, ordinary and natural meaning.

In my view the plain meaning of Section 3 (h) is that as long as the procurement stems from the core lunctions of the appellant then it is excluded from the jurisdiction of the PPDA Act and by extcnsion thc respondent.

All powers of the respondcnt, including thc mandate in Section 7, stem from the PPDA Act. But in view of the Constitution and Section 3 (h), the holding that the respondent retained a residual power over procuremcnt decisions regarding exempt procurements is misplaced. If thc lcgislature had intendcd for that to be the position, then it would have stated so. The decision of thc tribunal appears to imply that it was up to respondent to determine which procurcmcnts latl within the ambit of Section 3 (h) of the PPDA Act.

In Smart Protus Magara & Others vs Financial Intelligence Authority MCMA 138 of20l8, the court held as follows,

Court cannot legislate under thc guise of interpretation against the will expressed in the enactmcnt itself. It is not open to the court to usurp the functions of the legislature. Nor is it open to the court to place unnatural interpretation on the languagc used by the lcgislature and impute to it an intention which cannot be inferred from the language used by it.. .

This Court fully agrees with this holding which applies with full force to the finding by the tribunal thal the respondent retaincd advisory powers over the appellants exempted procurements.

If, for argument's sake the tribunal position was held to be correct, then it would be in contravention of Article 2 (2) of the Constitution which states,

(2) If any other law or any custom is inconsistent with any of the provisions of this Constitution, thc Constitution shall prevail, and that other law or custom shall, to the extent of the inconsistency, be void.

As stated beforc, the appellant in pcrforming its constitutional functions shall be independent and not subject to the control and direction ofany other authority. That independence insulates it lrom any commands from the respondent where it is exercising core constitutional functions.

In the result, Grounds 2 and 5 of the Appcal succced.

## (irou nds I & <sup>3</sup>

- l. Thc Tribunal errcd in law in holding that the Appellant's 2017 Manual is ultra vircs thc PI'>DA Act and is thercforc null and void to thc extent of that inconsistcncy. - 3. Thc Tribunal erred in law and fact in holding that thc Appcllant should havc sought thc advice of thc Rcspondcnt in coming up with the cxempt list undcr Schcdulc 6 to thc Manual.

It was submitted for the Appellant that the Manual in issue was not part of the evidence at the PPDA Appeals 'l.ribunal. Sccondly, it was not an issue for determination and the parties did not address thc tribunal on it. By making a finding on the Manual, the l'ribunal erred.

It was submitted farther for the appellant that when thc PPDA Appeals Tribunal made a finding on the Manual belbrc it hcard thc parties, it contravened the Appellant's right to a fair hcaring cnshrined under Article 28 of the constitution of the Republic of Uganda, 1995. 'l'he appellant citcd the Supreme Court decision of The Executive Dircctor, National Environmcnt Management Authority v Solid State Limited SCCA No. l5 of 2015.

l'hat without prejudice to its argumcnts abovc, thc conlcntion of the appellant was that Section 40A of thc PPDA Act providcs that a procuring and disposing entity which is not ablc to comply with a particular procurement or disposal procedure required under the Act, may apply to thc Authority for accreditation of an alternative system.

However, in view of Section 3 of thc PPDA Act the appellant did not requirc accreditation ofan alternative system whcn it is excrcising thc functions specified in Section 4 of the Bank of Uganda Act.

The appellant added that it had lodged an application, dated l3'h May 2015, to the Respondent for accreditation of thc llank of Uganda Procurement and Disposal Regulations and the standardisation poticy which the Appellant intended to use for all its procurement and disposal activities including thc exempt ones.

That the Respondent inlormed the Appcllant it considered its request for accreditation and reviewed thc categorization ofprocurement and disposaI activities including those that are required to comply with the PPDA Act and those that fall under Section 4 olthc BOU Act

It was stated for the appellant that in accordancc with Section 40A of the PPDA Act the respondent resolved that thc appcllant's core and non-core procurements as provided for in Scction 4 of the IIOU Act was not an arca lor accreditation. It was an administrative matter. The respondent subsequently granted the request for accreditation only for procurements that fcll outside thc Section 4 of BOU Ac1. The rest was not an area lor accreditation.

'Ihis was way back in the ycar 2015. Subsequently the Respondent's Board of Directors concluded that it was an administrative matter.

The appellant submits that thc Rcspondcnt's Board of Directors having held that the matter was an administrative mattcr, the Rcspondcnt cannot now tum around and contend that the 201 7 Manual required accreditation for exempt procurements. That in view of the above submission, thc PPDA Tribunal crred in law in holding that the Appellant's 2017 Manual is ultra vires the PPDA Act and is therefore null and void. In reply, the respondent's contcntion is that it is true the appellant had in <sup>2015</sup> applied fbr accreditation of thc Manual it intcnded to use lor its procurement activities. l'hat the respondent had accrcdited spccific areas of the manual for <sup>a</sup> period of two years effective 24tt' July 2015. 'l'hat the respondent in its decision on accreditation found that the manual was not an area for accreditation but an administrative matter. That on 6tr' October 2017 the accreditation of specific area was approved.

The respondent submits that the 201 7 procurement manual has never been accredited by the respondent. What was presentcd were the regulations.

## Dctermination of Grounds I and 6

At the hearing of this dispute beforc the PPDA 'tribunal, the parties framed the following issues:

- 1. Whether the Respondent has jurisdiction over procurement and disposal activities by the Applicant in thc exercise of its functions specified in Section 4 of the Bank of Uganda Act. - 2. Whether the Applicanl rcquires the Respondent's accreditation of <sup>a</sup> procurement or disposal system in respect of procurement and disposal activities by the Applicant in the exercise of its functions specified in Section 4 of the Act. - 3. Whether the procurement of a Security information and Events Management Solution (SIEM) software falls within the ambit of the Applicant's functions under Section 4 ofthe Act. - 4. Remedies, If any.

When the matter was called lor hearing before the tribunal, it was resolved that the first two issucs bc abandoned and argumcnts heard only in respect ol issues No. <sup>3</sup> and 4. It is thercfore lruc that no argumcnts or evidcnce was heard in respect of accreditation of the manual which was a matter for determination in issue No. 2.

Therefore, it was prcjudicial to the appcllant that the tribunal made a finding on <sup>a</sup> matter where the appellant was not heard.

The above notwithstanding, it is true that the appellant made an application for accreditation of its Procurcmcnt Regulations. It was the Respondent which in its response dated the 241t' of July 2015 advised the appellant not to refer to the document as The Bank of Uganda Procurcment And Disposal Regulations but The Bank of Uganda Procurcment And Disposal Manual.

In this same letter thc respondent accredited what was now to be referred to as The Bank of Uganda Procurement And Disposal Manual. In its determination of the matter at that time, it was indicatcd that the accrcditation was granted for a period of two years effective from the date of the letler which was 24th of July 20 I 5. Considering that there was no evidence rescinding this decision of the Respondent, then it cannot be said that the formerly accredited manual now need accreditation.

This court has also taken into account that accreditation of the manual was not in dispute when the unsuccessful bidder applied for administrative review, and that the parties were not given an opportunity to adducc evidence and be heard on it.

l'he PPDA Tribunal could not thcn havc properly and lawfully made a decision on the status of the manual. In such circumstanccs, the finding of the tribunal on the appellant's manual cannot be allowed to stand.

Grounds I and 3 ofappcal succecd.

## Ground 6

6. The Tribunal errcd in law and in fact whcn it affirmed the Respondent's dccision in its lcttcr datcd l0'h January 2020 in respect of the Administrative review.

In view ofthe findings in all thc loregoing grounds olappeal this ground succeeds

## In the result:

- 1. This appeal is allowed. - 2. The decision of the Public Procurement and Disposal of Public Assets Appeals Tribunal is set asidc. - 3. The decision and orders of thc respondcnt in its letter of the 1Oth of January 2020 are set aside. - 4. The respondent's instruction to appellant to suspend any farther actions on the procurement process is set aside. - 5. Each party shall bear its own costs here and in the tribunal.

.i

Michacl Elubu Judgc 25.1.2024