ANECT acted correctly in the allocation of orders by the ministry
(Prague, 26 October 2006) -the Office for the Protection of Economic Competition concluded that the Ministry of Labour and Social Affairs incorrectly awarded ANECT the order „operation of communication system ". The order, in relation to which the ministry received a fine of 500,000 CZK, was earlier won by ANECT in an open tender due to the low price of its bid. The tender was, however, cancelled and the ministry later awarded the order to ANECT in the form of „closed negotiation proceedings ".
„The awarding of the order to our company is correct from an objective point of view. We won the tender with the lowest priced bid. The state, and therefore taxpayer, is thus not damaged - on the contrary they saved over 120 million crowns" stated today Miroslav Řihák, Chairman of the Board and Managing Director of ANECT a.s. „The rebuke from the Office for the Protection of Economic Competition concerns formal errors in the process of awarding the order," added Řihák.
The Ministry of Labour and Social Affairs announced a tender for the operation of a communication system in August 2005. Two firms submitted bids - ANECT and the former Český Telecom. The only criterion was price. ANECT won with a bid of 591 million crowns, which was 121 million crowns lower than the bid from Telecom. Český Telecom immediately appealed.
Of the total order value the services of ANECT only account for approx. 15%, which is roughly 89 million crowns over three years. The remaining 85% represents the price charged by providers of the communication infrastructure over which the system is operated. These prices will be invoiced directly to the ministry by the telecommunication operators. „The main reason for the success of our bid was the skill of the negotiation team that was able to secure better conditions and price for the ministry with telecommunication operators than Český Telecom was able to offer," added Miroslav Řihák.
Despite the fact that the ministry did not agree with the objections of Český Telecom it decided in the end to cancel the tender. It subsequently requested ANECT to prepare an offer in closed proceedings. The resulting contract price was a further 75 million CZK lower than its original bid in the tender process.
„We believe that with regards to time limitations a large role may have been played in the decision of the ministry to award the order in the form of closed negotiation proceedings by the complexity of the Act on Public Orders, which allows unsuccessful companies a range of options for obstructing the winning bid. According to my information if the ministry had not cancelled the order it would not have been able to sign an agreement for the supply of the same services with anyone. It would thus fall into a legislative trap. The procedure adopted by the ministry was therefore the only way to ensure that the system of making social security payments remained operational," explained Miroslav Řihák, Chairman of the Board and Managing Director of ANECT a.s.
Subsequently in January 2006, the ministry signed an agreement with ANECT for the operation of a communication system. Český Telecom immediately lodged a complaint with the Office for the Protection of Economic Competition. The antimonopoly authority issued its decision at the beginning of October in which it concluded that the Ministry of Labour and Social Affairs acted incorrectly in awarding the order to ANECT and it imposed a fine of 500 000 crowns on the ministry. Although the ministry had the right to appeal it did not do so.
Contact:
Šárka Beránková, sarka.berankova@anect.com, tel.: +420 724 427 246
