•KRA, the National Treasury and SICPA had appealed a High Court ruling in 2018 that the contract had been irregularly issued.
•KRA and SISCPA entered into a five-year contract for the provision security and tractability of excisable consumer goods.
The Swiss firm contracted by Kenya Revenue Authority to provide excise stamps has welcomed the Court of Appeal decision, that due process was followed in awarding it the contract in 2013.
This comes even as uncertainty surrounds its engagement with KRA after the expiry of its contract in July this year, with the taxman seeking a new supplier of excise duty stamps.
Busia Senator Okiya Omtata had in 2018, as an activist, successfully challenged the SICPA system implementation and contract, amid questions over public participation in the process.
Appellate Court judges Hellen Omondi, Daniel Musinga and Grace Ngenye this week ruled that KRA did not break any law when it awarded the tender to SICPA.
“SICPA welcomes the recent decision by the Court of Appeal in Nairobi that due process was followed in the procurement and award of the EGMS contract in 2013,” it said in a statement yesterday.
KRA, the National Treasury and SICPA had appealed a High Court ruling in 2018 that the contract had been irregularly issued.
Having considered the presentations made before it, the three-judge bench unanimously agreed that the procurement and award processes did not violate any tendering rules, and that the appeal was justified.
This means therefore that the process followed by KRA and the National Treasury to appoint SICPA as the provider of a secure anti-illicit trade systems in the form of enhanced tax stamps, was finally judged fully compliant to Kenya’s public procurement law, despite criticism against it.
EGMS supports the government to optimise public revenue from excisable goods, tackle the illicit economy and enhance consumer protection.
A parliamentary committee however recently questioned the integrity the Swiss multinational security printer.
In August, the National Assembly’s Committee on Finance and Planning summoned top director of SICSPA SA, after the snubbed the committee twice to explain the EGMS system, including the number of excise stamps that have so far been supplied and how the firm costs the said stamps.
The Committee also wanted to ascertain the circumstances that necessitated termination of the contract awarded to SICPA in 2015.
The committee is probing the EGMS project by SISCPA which has been demanding the settling of a Sh4.5 billion debt from KRA, a matter that triggered Treasury to increase the cost of excise stamp taxes to avoid taking over the debt.
KRA and SISCPA entered into a five-year contract for the provision security and tractability of excisable consumer goods.
Earlier this year, KRA had indicated the contract with SICPA would expire in July, as it advertised for expression of interest to similar service providers amid takeover of the system.
The contract has been riddled with allegations of undue process with questions being raised weather KRA will consider SICPA for a new contract.
Treasury CS Njuguna Ndungu said the expression of interest was meant to allow service providers to showcase what they have in line with modern technology, to ensure the country gets the best.