Mbabane – The High Court has been asked to urgently halt construction of the Central Bank of Eswatini’s new headquarters in Ezulwini after the Eswatini Consumer Forum (ECOF) challenged the legality of the procurement process, alleging that about E2.7 million is being spent on the project every day while an allegedly unlawful tender continues to be implemented.
In an urgent application filed under Case No. 1624/26, ECOF is seeking an interim interdict stopping all construction on Phase 1 of the project pending the outcome of a review application. The consumer body is also asking the court to prohibit the Central Bank of Eswatini (CBE) from making any further payments to the contractors until the review has been determined.
The respondents cited in the matter are the Central Bank of Eswatini, the Construction Industry Council (CIC), the Eswatini Public Procurement Regulatory Authority (ESPPRA), Ingcebo Joint Venture, Stefanutti Stocks Eswatini (Pty) Ltd, Stefanutti Stocks Construction Eswatini (Pty) Ltd and the Eswatini Contractors’ Association N.O.
According to the application, the procurement process undertaken by the Central Bank and the subsequent approval granted by the Construction Industry Council were unlawful because the successful bidders allegedly failed to meet statutory requirements governing participation in public procurement.
In answering papers, the fourth, fifth and sixth respondents state that construction has already been underway for approximately eight months and is well advanced. They argue that suspending the project would expose the Central Bank to substantial demobilisation and remobilisation costs, delay completion of the development and affect more than 40 subcontractors and hundreds of workers currently engaged on site.
The respondents submit that first, Eswatini Consumer forum was not a competing tenderer and has no direct interest in the construction of the new Central Bank. It has no skill in respect of construction, let alone the construction of a building as complex and as large as the new Central Bank. It is instead a self proclaimed organisation that purports to advance matters of public interest. It is, to coin a phrase used by this court in a similar context, a “busy body”. Having no interest in the subject matter of the application ECOF lacks the necessary standing to bring this application.Second, despite no evidence or basis to make the assertion, ECOF asserts that local Swati entities can perform the work awarded through the tender. This is incorrect: as the CBE has itself confirmed, “the top three Eswatini locally registered contractors in the CIC registry participated in the bid for the Central Bank project and they all came in with foreign partners”. The reality of this project is that no local entity, or combination of local entities, could meet the tender requirements or credibly perform the work required.
The respondents further submit that stopping the project would result in standing costs estimated at about E300 000 per day, excluding other financial consequences associated with delays.
They reject allegations that the successful bidders failed to meet localisation requirements, maintaining that Stefanutti Stocks Construction Eswatini complies with applicable ownership requirements and that 60 per cent of the company is owned by emaSwati through local shareholders and directors.
The contractors also argue that no local contractor possessed the financial and technical capacity to undertake the project independently, saying all shortlisted bidders partnered with international firms because of the specialised nature of the development.
According to the respondents, the project includes a 21-storey headquarters building, museum, innovation hub, underground parking and other specialised infrastructure requiring expertise beyond the capacity of a single local contractor.
They also dispute the urgency of the application, arguing that the tender award was publicly announced in October last year and that ECOF had been aware of the procurement process for several months before approaching the High Court.
The respondents maintain that any dispute regarding the legality of the tender can be determined through the review proceedings without stopping construction.
The matter is pending before the High Court, which will determine whether construction should be suspended pending the outcome of the review application.
ECOF argues that construction should be stopped before more public funds are spent on what it describes as an invalid administrative decision.
In its heads of argument, filed by Nkomondze Attorneys together with K.Q. Magagula Attorneys, the forum relies on established legal authorities, including Oudekraal Estates v City of Cape Town and MEC for Health, Eastern Cape v Kirland Investments, arguing that administrative decisions alleged to be unlawful remain effective until set aside by a court and that interim relief is necessary to preserve the status quo.
“The urgency arose because construction is continuing unlawfully, public money continues to be paid, and implementation continues with daily spendings in the sum of E2.7 million,” the applicant states in its court papers.
The forum says it only recently obtained evidence relating to what it alleges is the non-compliant ownership structure of the companies involved in the project. It argues that, at this stage, it only has to establish a prima facie right by showing that there are serious questions regarding compliance with the Procurement Act and approvals granted contrary to Section 40(1) of the Construction Industry Council Act.
ECOF further argues that if construction is allowed to continue, the project could reach a stage where the court would be confronted with a fait accompli, making it difficult to grant meaningful relief should the tender ultimately be declared unlawful.
According to the application, the public interest lies in ensuring procurement processes comply with the law rather than allowing construction to proceed at the expense of constitutional legality. The forum argues that commercial inconvenience cannot outweigh the need for lawful administration and warns that refusing interim relief could undermine public confidence in public procurement at a time when concerns continue to be raised about maladministration, reckless expenditure and corruption.
The applicant also contends that alternative remedies available under procurement legislation are inadequate because the Section 45 Notice issued by the Central Bank was invalid and did not suspend construction or prevent continued expenditure.
Apart from stopping the construction works, ECOF wants the High Court to order the Construction Industry Council to file the complete record relating to the approval of the tender with the Registrar within seven days. It is also asking the court to compel the Central Bank to produce the procurement record maintained in terms of Section 14(1) and (3) of the Public Procurement Regulations, 2020, within the same period.
The costs of the application, the forum says, should be determined after the conclusion of Part B of the proceedings.
In the review proceedings, ECOF intends challenging the tender award on four principal grounds.
It argues that the successful bidders failed to satisfy statutory participation requirements and that procurement legislation was not complied with. It also questions whether the Construction Industry Council’s approval of the contractors was rationally connected to the requirements of the Construction Industry Council Act.
The forum further intends challenging the procedural fairness of the evaluation process, alleging that it failed to comply with the Procurement Act and its regulations. It also argues that procurement authorities relied on incorrect information regarding the ownership structure and eligibility of the successful bidders.
However, the contractors have opposed the application and argue that stopping construction would cause significant prejudice and financial loss.
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