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A general view of the border fence separating South Africa and Zimbabwe near the Beitbridge border post.
- Two companies responsible for the controversial Beitbridge border fence have agreed to pay any amount ordered against them by the Special Court or a court.
- The Special Court ordered the withdrawal of the case as part of an agreement between SIU, Magwa Construction and Profteam CC – contracted to build the fence.
- The Special Investigation Unit initially set out to obtain a restraining order to freeze the bank accounts of the two companies.
The contractors responsible for the porous fence on the Beitbridge border have apparently succumbed to pressure from the Special Investigation Unit (SIU) which agreed to pay any amounts ordered against them by the Special Court or a court.
On Friday, SIU’s offer to freeze Caledon River Properties CC’s bank accounts listed as Magwa Construction and Profteam CC was withdrawn.
The companies were responsible for the construction of the border fence for which 40 million rand had been budgeted.
Judge Lebogang Modiba granted the withdrawal of the case as part of an agreement between the parties not to proceed with Part A of the case and deal with Part B directly.
Party B dealt with the merits of the case, while Party A only dealt with the freezing of contractors’ accounts.
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SIU spokesperson Kaizer Kganyago said that all parties agreed that the Department of Public Works and Infrastructure (DPWI) will initiate proceedings, issuing and delivering the same, against Magwa Construction and Profteam CC within 20 days of the order of the Friday.
The two companies, “without admitting any infringement”, also agreed to pay whatever amount ordered by the Special Court or a court.
“Pending the initiation of the planned procedures, Magwa Construction and Profteam CC [the first and second respondents respectively] it will not make any claim and the DPWI will not pay any amount arising from the general conditions of the contract, second edition (GCC 2010). If the above action is not instituted, Magwa Construction and Profteam CC can immediately proceed to enforce their rights under the GCC, “Kganyago said.
Kganyango said the agreement pleased the SIU that the subsequent ruling would be honored.
He continued:
“The defendants’ commitment to pay any amount ordered against them by the court gives us peace of mind that the subsequent judgment will be served. The order further guarantees that DPWI will not pay any additional amounts claimed by the service provider against the contract balance pending initiation of the proceeding. The SIU will ensure that every effort is made to protect the state’s resources from any misuse. In this case, we have successfully stopped payment for the DPWI in the amount of approximately R18 million before it was paid to the contractors. “
The parties also agreed that Part B of the case should be quickly registered in the Special Court.
DPWI’s national bid award committee (NBAC) approved both bids for the project in March.
On March 18, the NBAC approved the appointment of Magwa Construction to provide contractor services at a cost of R37 million.
The following day, the appointment of Profteam CC was approved to provide professional services at a cost of R3.2 million.
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The project was intended to secure the country’s border with Zimbabwe in the wake of the Covid-19 pandemic. It had a budget of R40 million, and so far, R21.8 million had been paid to contractors.
The SIU’s initial request was to freeze the bank accounts of the two companies to recover the 21.8 million rand.
An investigation into the Beitbridge border fence project found that the government paid R17 million more than the market-related cost.
In August, investigators detected at least 115 violations that facilitated the illegal entry of illegal immigrants to South Africa from Zimbabwe.
Kganyago said the SIU sought to void the contract between DPWI and the contractors to recover any money that DPWI may have lost.
The costs of the application were reserved to be determined by “the forum determining the action.”
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