Chinese embassy deal being probed

The deal to award a stateowned Chinese company the contract to install X- ray scanners in Canadian embassies around the world is being reviewed by the quasi- judicial body that governs the federal government’s procurement process.

The Canadian International Trade Tribunal has informed Beijing- based Nuctech that it has decided to conduct an inquiry, based on a complaint made by rival bidder, Kprime Technologies of Calgary.

Kprime alleges that Public Services and Procurement Canada failed to evaluate its bid properly and that Nuctech’s submission should have been judged ineligible.

The official notice was sent to Beijing since Nuctech does not have an administrative presence in Canada.

The CITT has the authority to overturn agreements made with the Canadian government, or even award the contract to the complainant. The tribunal weighs whether bids were evaluated fairly and in accordance with terms of the procurement process.

Another complaint, this time by Smiths Detection Montreal, was rejected by the CITT last month.

Smiths complained Nuctech engaged in predatory pricing but the tribunal said the complaint did not disclose “any reasonable indication of a breach of trade agreements”.

The National Post revealed in July that Nuctech’s $ 6.8 million bid to supply X- ray scanners to 170 embassies, high commissions and consulates around the globe had been successful. Nuctech was chosen ahead of at least three Canadian companies — Kprime, Smiths Detection and VOTIDetection of Montreal — as well as California- based, Rapiscan Systems.

Kprime submitted a lower bid than Nuctech — $5.4 million — but it was ruled out by the committee at Public Services and Procurement Canada that chose the winning bidder.

Kham Lin, chief executive at Kprime said his company’s bid was deemed inadmissible because it did not state that it could detect aerosols and weapons. But Lin said all the machines competing for the contract do the same thing — highlight the suspicious object in a shaded box for the operator to take a closer look.

“The technology itself cannot detect — it is up to the operator,” he said.

Kprime complained to the CITT that its bid should be reassessed on technical grounds but also because Nuctech should not have been allowed to bid on ethical grounds.

Nuctech has been at the centre of numerous allegations of bribery in Taiwan and Namibia and was subject of a five year tariff on its products in Europe over dumping charges.

Ottawa’s integrity regime states that Canada will only do business with ethical suppliers that do not engage in bribery, fraud, bid- rigging, tax evasion or insider trading.