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Eskom found guilty of awarding tender to Chinese company with 0% black ownership

The Commission released its findings saying it investigated after receiving an anonymous complaint alleging that the tender process did not comply with the requirements.

FILE: Eskom's Megawatt Park offices in Sunninghill. Picture: EWN.

JOHANNESBURG - The Broad-Based Black Economic Empowerment (B-BBEE) Commission said on Wednesday Eskom was guilty of awarding a tender for boilers at the Duvha power station in Mpumalanga to a Chinese company that didn’t meet BEE requirements.

The commission released its findings saying it investigated after receiving an anonymous complaint alleging that the tender process did not comply with the requirements.

The complainant told the commission that the tender was awarded to Dongfang Electric Corporation Limited, a Chinese-owned entity with 0% black ownership when the tender required at least B-BBEE Level 4.

“Upon investigation, it was found that Eskom Holdings SOC Limited failed to comply with section 10 (1) (b) of the B-BBEE Act in awarding of the tender to Dongfang Electric Corporation Limited, an entity with 0% black ownership when the tender required at least B-BBEE Level 4,” the commission said in a statement.

The commission said Eskom cooperated with its investigations but its recommendations to the Minister of Public Enterprises Pravin Gordhan were that the contract be cancelled, and investigations be conducted to find out if officials deliberately compromised the process to favour a specific entity.

It also recommended that Eskom conduct an independent audit of all its contracts above R1 billion from 2014 to check compliance with B-BBEE requirements.

“Therefore, in addition to the recommended contract cancellation and the independent audit by Eskom Holdings SOC Limited, we recommended investigations in respect of officials that were involved in this tender process so that decisive action can be taken to prevent this in future. Of concern also is the possibility that this tender process may have been deliberately compromised to favour a specific entity.”

(Edited by Thapelo Lekabe)

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