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IRREGULARITIES IN NAVY BOATS CONTRACT WILL BE INVESTIGATED: MND

ROC Central News Agency

2005-10-19 22:23:12

    Taipei, Oct. 19 (CNA) If any irregularities are found to have taken place in the bidding for 30 missile-equipped ROC Navy speedboats, the defense ministry will refer the case to prosecutors, Minister of National Defense Lee Jye told lawmakers Wednesday.

    Lee made the remarks at the National Defense committee of the Legislative Yuan in reply to Democratic Progressive Party Legislator Lee Wen-chung, who said there were several "suspicious points" regarding the ROC Navy's Kuang Hua No. 6 Shipbuilding Project.

    The minister said he was not aware of the review process that was handled by the Cabinet's Public Construction Commission (PCC), but he admitted that there may be "something strange" about the fact that a company offering a lower price did not win the bid.

    He emphasized that there had been no so-called "pressure from above" during the bidding process.

    Although China Shipbuilding Corp. (CSBC) was awarded the contract for the vessels, controversy surrounds the nature of the rankings for two other companies that did not win the bid.

    Lee Wen-hung pointed to two unusual things about the bidding process: according to a PCC report, of the 10 review committee members, five gave Ching Fu Shipbuilding Co. a first-place ranking while the other five ranked it third.

    These 10 members, five from the private sector and five from the military, did just the opposite for Jong Shyn Shipbuilding Co. -- with five ranking it first and five putting it third.

    He pointed out that the five who gave Ching Fu full marks were from the military while those placing it third were private-sector experts. The two groups made the exact opposite assessment of Jong Shyn.

    He said the authorities should look into the original bidding files to see if there had been any problems with the two companies and their connections with these two groups of review committee members.

    Opposition People First Party Legislator Sun Ta-chien suspected that the two companies might have known beforehand the identities of the 10 people who were going to vet the tenders.

    Sun claimed at a news conference at the legislature that Ching Fu Chairman Chen Ching-nan has close ties with President Chen Shui-bian, while Jong Shyn Chairman Han Pi-hsiang is well connected to first lady Wu Shu-jen and Vice President Annette Lu, resulting in a bidding race that more resembled a "duel between two factions inside the court," instead of a business deal.

    He said Ching Fu has an "extremely poor record" of building frigates for the navy, and yet the five military experts still ranked it No. 1. This seems to indicate that its chairman must have had access to the list of the review committee members, which should have remained confidential, he asserted.

    In the end, CSBC won the bidding by beating out Ching Fu and Jong Shyn. However, Sun said, Jong Shyn's appeal to the PCC did not complain about the CSBC but instead focused criticism on Ching Fu, meaning that CSBC was kept out of the fray.

    He urged the prosecution to investigate the PCC's decision-making process, adding that the defense ministry should also explain why the navy has suddenly suspended the procurement process.

    Even though the CSBC, by all reports, was given the contract, the building project was halted after Jong Shyn launched a publicity campaign to sway the awarding of the contract on the grounds that it can do the same job at a lower price.

(By S.C. Chang)

ENDITEM/mw