Our Investigation team has concluded its story concerning the bankruptcy of Global Security JSC, a Russian company that was awarded a 10-year contract to
install digital monitoring systems in all motorcycles and vehicles in Uganda.
This Company has a pending case in Russian courts of law, according to a ruling by the Arbitration Court of the City of
Moscow, after the company failed to pay a debt, it owed to the
LLC “Rus Prom-Technologies”, another Russian company which was a service provider in a failed project in Poland.
The court
ruling though did not indicate the amount
of money that Joint Stock Company Global Security was demanded.
The Rus-Prom-Technology–Joint Global Security
litigations began in March 2019 when the former sued the latter for failure to
pay 16.6 million rubles (Russian currency) – about $220,000. When
Rus-Prom-Technology won the case and Joint Global Security failed to pay, the
former sued the latter.
What is
not clear is how Joint Stock Security would
raise
money because the court earlier ruled that no company assets had been identified that could pay for the cost of bankruptcy proceedings.
In July, Attorney General Kiryowa Kiwanuka
said the 10-year contract with the Russian company Joint Stock Company Global
Security was approved by his office.
More debts.
Global
Security has been facing other debt litigations in Russia. Stok-Trading LLC
sued it for a debt of 1.2 million rubles which is about $16,260, Jsc Royal Silk
Factory sued the company for a debt of 19.9 million rubles ($270,000), Turday
GS Slovak Republic sued the company for a debt of 6.1 million rubles ($82,655),
JSC ZVI sued the company thrice; first for a debt of 23 million rubles (about
$300,000) then a debt of 10 million rubles (about $135,500) and 4.6 million
rubles (about $62,330).
Global
Security has also been sued by Limited Liability Partnership “Orken Alem” for a
debt of 8.5 million rubles (about $ 115,175) and Gu Main Department of the
Pension Fund of the Russian Federation for failure to pay 10,000 rubles (about
$135) and 455,00 rubles (about $600). All these cases were filed between 2019
and July 2021.
WHAT YOU NEED TO KNOW:
Uganda Awarded Global Security a deal to handle our digital number plate
project. This project was supposed to produce a number plated by May 2023, which
was not possible.
According to Minister Jim Muhwezi, they faced a few challenges and claim the project would kick off its work by the end of September with Government cars then in October the project will be extended to privately owned cars and Motorcycles.
Read More...............
Though the Internal Affairs Minister, Gen Kahinda Otafiire a few days ago said that he warned President Museveni about the digital number plates deal by Russian company, M/S Joint Stock Company Global Security but his letter went unanswered.
“I wrote that the Russian company can work with the current manufacturers of number plates in Uganda and explore the possibility of putting their chips on the number plates in Uganda. I intimated to him that it would be a bit insensitive for us to shut down a local manufacturer in favour of the importation of number plates when we can do it here. I never received reply, I doubt whether the president received that communication,” Otafiire said.
The Internal Affairs Minister was facing the Physical Infrastructure Committee of Parliament about the implementation of the digital number plate project.
Otafiire told MPs on the committee that a benchmark report by police indicated that the Russian company’s system was not in use in any other country in the world, adding that claims by the company that it will be printing the number plates from Poland are untenable.
“The first time I got to know about this project other than the press was when Mr.Wavamuno(Gordon) wrote to me complaining about the shutdown of his business in favour of Joint Stock and was suggesting they could work jointly.”
The minister said he later called the Permanent Secretary for Internal Affairs Ministry who said he didn’t know about the digital number plates deal.
“It was then I wrote to the president and suggested it would be a good idea if the Russian company worked with current number plate manufacturers in Uganda and explored the possibility of installing chips in Uganda. I got a report about police officers who went to do due diligence about the company in Russia who highlighted that what they saw was a system for large fleet management and that it has never been enrolled anywhere in the world and that Russia itself does use that system,” Otafiire said.
He explained that the current frosty relations between Russia and Poland over the war in Ukraine might not allow a Russian company to print the number plates in Poland.
“The team wanted to visit the factory and were told that it was in Poland and as far as I am concerned Poland is technically at war with Russia and any Russian company operating within NATO is under sanctions. I was wondering how we are going to implement this project in these circumstances. Unless otherwise, if those pushing this project can explain how this is going to be implemented, I have nothing more to add.”
The minister insisted that as the Minister for Internal Affairs under whom police which is going to implement the project Falls has never been consulted about the digital number plate deal.
“I don’t know them and I haven't seen anybody from Global Security and I have never talked to anyone.
The URA Commissioner General threw the spanner in the works when he said the cost of shs735,000 for a digital number plate is too much.
He said it would push some people out of owning vehicles or motorcycles.
“If the cost is prohibitive, maybe many vehicle owners may not afford the number plates. I think it is important that the negotiators go for the most optimal because there is a benefit they want to achieve, but also a cost that would be draining money from taxpayers which could be spent on other areas, other than this technology. Charging Shs714,300 from boda boda, probably registration and clearance of boda bodas will significantly reduce, but I don’t have the numbers,” Musinguzi said.
The MPs on the physical infrastructure committee asked that all officials involved in the digital number plate deal be arrested.
Kampala City Traders Association, KACITA recently blamed the government for rushing the digital number plate deal.
KACITA also raised concern over the “abnormal cost” of the digital number plates and the rational for the payment gap that they say is unfair.
“We have noticed that the new cost will be more expensive compared to the that of regional neighbors like Kenya where number plates cost Ksh 3,000 (shs80,000) for motor vehicles and Kshs 1,500 (shs40,000) for motorcycles and they bear the same security features. Comparison on the costs per plate from shs125,000 to shs713,000 for motorcycles and from 137,000 to 713,000 for motor vehicles raises the overall cost of the unit and this is so ridiculous,” KACITA chairman, Musoke Thadeus Nagenda said recently.
He said dealers are already facing various financial challenges, including high fuel costs, maintenance expenses, and insurance costs, and increasing the cost of digital number plates and tracking devices to their financial burden will push them further into financial distress.
The traders asked to know the breakdown of the shs735,000 for each digital number plate to be undertaken by Russian company, M/S Joint Stock Company Global Security.
“We also need an inquiry on the status of the credibility of the service provider According to various reports, the company is said to be bankrupt and non-operational. There is also no proven track record where this company has carried the same project successfully yet we have credible local potential service providers that would do the same thus defeating the BUBU initiative. This compromises the national image and a potential ticking time bomb in case they fail to deliver, and to mention capital flight and repatriation.”
The traders said there would be administrative bureaucracies after the government indicated that any changes to the car must be made after consultation with the chief licensing officer and in writing.
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