PGN found guilty of discrimination in tender process

State owned gas distribution company PGN has been found guilty of discriminating the bidders of the company's recent tender in the procurement of steel pipes for the second stage of its South Sumatra-West Java gas pipeline project, Kompas reported Wednesday

The anti-monopoly commission KPPU said in a ruling Tuesday that PGN had conducted an unfair practice in the tender process for the procurement of steel pipes for the company's gas pipeline project by discriminating most of the bidders.

For the offence, the anti-monopoly commission asked the board of the directors of PGN to terminate its contract with Det Norske Veritas Pte Ltd, a Singapore-based company assigned to verify and inspect the capability of the tender participants.

KPPU's chairman Pande Radja Silalahi said in the ruling that the Singaporean company did not carry out its verification and inspection task on the entire participants during the selection process in the tender as supposed. This had led to the appointment of a consortium of South East Asia Pipe Industries (Seapi)-Welspun as the winner of the tender because the consortium was considered as the only company qualified to provide the steel pipes for the gas pipeline project.

The other bidders in the tender included Bakrie and Brothers, Welspun Gujarat Stahl Rohren Pte Ltd, Daewoo International Corporation and PT Cipta Dekatama Tastek.

KPPU also ordered PGN to issue administrative measures against the company's senior manager who was in charge of the pipeline project. (*)