[kictanet] It's a new twist for Econet Wireless

[Mike Theuri]

Dear Dr. Bitange,

Thank you for your candid response and dialogue. I disagree that I am
in effect spilling any beans. The information being shared is in
possession of the Government, the regulator, KACC, courts in various
jurisdictions and covered in numerous publications across the world.
These are public domain sources and some of these documents have been
provided in many different courts by none other than Econet and the
regulator. In case my liberal sharing has been misunderstood, the
information I have shared revolves around the infamous litigant,
Econet, any information that touches on the Government is a result of
being willingly or unwillingly mired in the scandal and highlights the
danger of the Government crossing the line of being an impartial party
and becoming complicit by extension in the actions of the foreign
entity.

The documents and facts speak for themselves and I believe there is a
pending matter in court against the regulator over the failure to
respond appropriately to an objection to the licence as required by
law. Such are the endless consequences that will potentially continue
to haunt the government if the right decision is not carried out.

My humble opinion is that for the sake of integrity and faith in
future tendering and so as to attract companies that will not
disappoint, that the regulator seek to conduct proper and thorough due
diligence so that Kenyans and the GoK are not in essence defrauded or
deprived of revenue by certain foreign companies out to make quick
dollars from Kenyans. Involving the World Bank and the ITU in an
advisory role for future tenders would also help prevent future
mishandling and tendering mishaps and lend credibility to the tender.
The GoK and the hard working people of Kenya are the unwitting victims
of machinations and trickery by this foreign entity. Succumbing to the
whims and wishes of this entity (including aiding in the
disenfranchisement of Kenyans and awarding the licence to a stranger)
is not the only way to handle the matter.

It is apparent that the funds were paid into Citibank - Nairobi,
Citibank ought to have been paying market rate interest on the funds,
thus the interest burden need not be passed onto the taxpayer as a
result of any decision to refund the payment. Indeed the $1.3 million
bid bond which was supposed to be forfeited by law upon failure to pay
ought to defray any additional costs.

The government has several legal avenues and I am not convinced that
all administrative measures by the regulator have been exhausted. The
fact that Econet failed to abide with a 60 day payment deadline (the
tender rules demand payment in full, so does the ACEC Act which cites
an Economic Crime as seeking or obtaining an abatement or exemption
from making payments due to a public body), failed to maintain the
nature of its consortium, misrepresented facts to the regulator prior
to the tender, throughout the tender and after the tender, told
falsehoods to the Kenyan public through full page advertisements (eg
US$300m market cap in the Zimbabwe stock exchange) are more than
sufficient reasons to cancel and retender or in the alternate allow
other bidders to step up to the plate which could result in a bigger
windfall for the exchequer and the Kenyan public.

The greatest injustice here would not only be the disenfranchisement
of KNFC from the licence but the apparent failure by the regulator and
GoK to combat the apparent and glaring gross misrepresentations,
deceit and fraud by the foreign entity. The GoK has a duty on behalf
of the nation to combat entities that seek to mislead the Kenyan
people. The GoK and the people may be fatigued of the quest to do the
right and correct thing but this is not the time to falter and give in
to the foreigners unmerited demands.

Indeed a decision needs to be made, but why not the right decision to
cancel based on the numerous violations of tendering procedures or
setting the condition that the consortium must retain its original
composition per the tender rules in order to have a way forward? The
fact that these violations and misrepresentations occurred do not
entitle the entity to any refund beyond the principle amount that was
paid. An analogy is the acquisition of a Kenyan passport by a
foreigner under false pretences, the fact that they have the passport
and are a 'citizen' does not mean both cannot be revoked on the basis
of the false pretences.

Indeed the regulator set a precedent on January 27th 2007 when it
cancelled the SNO tender offer to VTel for the very similar reasons
that plague the foreign entity's consortium and extended the offer to
Reliance. However since it is apparent that the entity violated
several tendering and public procurement requirements these reasons
alone should supersede cancellation based on the wrangles.The should
act consistently so as to maintain parity in carrying out its duties.

Let us not rush to be decisive when it is apparent that there is
useful and extensive evidence that the Government could use to justify
cancelling the award to the foreigners and holding them accountable to
the Kenyan people for damages sustained as a result of their inability
to meet the tender requirements. All the best.

Regards,

Mike Theuri



On 7/30/07, bitange at jambo.co.ke <bitange at jambo.co.ke> wrote:
> Dear Mr. Theuri,
> Whereas you may be having more information than we do, it may be prudent
> for you to spill out the beans for the world to know.  It is pointless to
> implicate the Government if you cannot substantiate your claims.
>
> We have gone through all these motions for the past one year and the best
> way forward was to remove government from any possible liability.
> Remember we accepted $15 million deposit for the licence fee (whether this
> was right or wrong it is water under the bridge).  Even if we were to
> refund this at normal interest rates, it is a lot of money to the tax
> payer.  One way or another, we had to make a decision since this matter is
> more of regulatory than policy.
>
> If indeed there is injustice to the whole matter, the courts will deny
> Econet from getting to set up in Kenya.  Nobody has stopped KNFC from
> pursuing justice.
>
> One thing that I have learnt in this office is that you cannot be
> indicisive and hope to achieve anything.  I have always used Thika road as
> the best analogy.  In as much as the users are suffering with traffic
> jams, they usually do not think the same if the Government wanted to make
> it a six lane highway in both sides, still there will be protesters who
> will say pedestrians crossing will have a problem or the goat keepers at
> Utalii will claim lost business.  Once in a situation and you want to move
> on, the most prudent thing you do is to make a decision (good or bad).
>
> Have a decive day.
>
>
> Regards
>
>
> Bitange Ndemo.
>