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4 leading building contractors blacklisted for the first time in highways sector
View(s):By Namini Wijedasa
The Ministry of Transport, Highways and Urban Development this week blacklisted four leading building contractors, debarring them from participating in tenders for periods of between three years and six months.
It is the first time such action has ever been taken in the highways sector. M/s Consulting Engineers & Contractors (Pvt) Ltd (three years), M/s V.V. Karunaratne & Company (one year), M/s HOVAEL Construction (Pvt) Ltd (one year), and W.K.K. Engineering Company (Pvt) Ltd (six months), are also debarred from entering into any new contracts or subcontracts under the purview of the Ministry.
The actions were taken in accordance with Chapter 10.2 (B) of the new Procurement Guidelines, which were published in 2024 and came into effect in January this year.
All four companies are of the CS2 grade, the highest classification awarded by the Construction Industry Development Authority (CIDA), the regulator. According to a Cabinet paper seen by the Sunday Times, three of the companies are alleged to have provided false information to secure a lucrative contract under Section 3 of the Central Expressway Project.
The entities are entitled to appeal. The cited section of the Procurement Guidelines details the sanction/debarment/blacklisting procedure. It states that such steps shall occur only after providing the relevant parties with the opportunity to show cause. Separately, the reasons for sanction must be verified by an independent committee.
According to documents seen by the Sunday Times, due procedure was followed, including the appointment of an independent committee, the inspection of documents submitted by the companies, a hearing on October 10, 2025, and further communications related to the allegations.
In September, the Sunday Times reported that Cabinet instructed the Highways Ministry Secretary to look at the “appropriate procedural steps to be taken in addressing the alleged fraudulent and corrupt practices” if the contractors. Cabinet also approved Highways Minister Bimal Ratnayake’s proposal to instruct the National Procurement Commission and CIDA to “take action accordingly” regarding these contractors.
Minister Ratnayake’s Cabinet memorandum revealed that the standing high-level procurement committee recommended action against the bidders “based on the submission of documents with their technical bids containing elements of fraud and corrupt practices” identified by the bid evaluation committee.
The new procurement guidelines aim to minimise fraud and other malpractices related to the bidding process. Under them, authorities may sanction, debar or blacklist bidders, suppliers, contractors and service providers for violating the guidelines and the terms and conditions of the relevant procurement documents.
Actions may also be taken against officers of any institution to which the procurement guidelines are applicable if they are involved in public procurement and are found responsible for violating the procurement guidelines, including the ethics of public procurement (which is another section of the guidelines).
One of the violations defined in the guidelines that qualifies a bidder, supplier, contractor or service provider for sanction, debarring or blacklisting is: “Submission of eligibility and qualification requirements containing false information or falsified documents.”ReplyForwardAdd reaction
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