Loss of MVR1.2 million to State due to lease of land to Marry Brown Restaurant

It has come to light that corruption may have been involved in the process of leasing the land to a private group to establish Marry Brown Restaurant located at Maafannu tennis court area, and that the agreement would result in a loss of MVR1.2 million to the State.

The bid to establish a building to provide the services necessary for the Tennis Association at the tennis court area was won by famous tennis player Amir Mansoor in 2008, and multinational fast-food chain Marry Brown opened its restaurant at the location in September 2011.

The Audit Report of Youth Ministry for 2010 states that the first round of bids were cancelled on 16 July 2008 for the construction and operation of a two or more storey building including a warehouse, office and meeting hall for the Tennis Association at the empty land at the tennis court area at Maafannu Stadium, due to failure by parties that submitted the bids to meet the requirements. The report states that the bidding process was opened and announced again, and while the announcement did not state the purpose of the bids, the bid evaluation procedure that was followed is also not known.

The report states that out of the five parties that submitted bids, the three chosen parties were related, and that the party that had submitted the best bid had withdrawn its bid; and that the reason given by that party for withdrawing the bid would have been clear even when the bids were first submitted. The report noted that the purpose of withdrawing the bid was to ensure that the bid was won by a particular party, and that the bidding process was not opened again following the best bidder’s withdrawal; rather, the project was awarded to the second best bidder.

“The ministry was negligent because the project was awarded to the next best party without opening the bidding process again. It was also noted that the state will receive MVR1.2 million less as rent over a period of 15 years due to this change of the party that won the bid,” says the report.

The Auditor General had advised to forward the case to the Anti-Corruption Commission (ACC). The report states that articles 8.46 and 8.47 of the Finance Act were violated in leasing the land and that the case should thus be investigated; and that article seven of the Finance Act should be followed when leasing land in the future.

Another issue noted in the report is that the terms of the agreement made in 2008 to hand over operation of Muni Ufa Café to a private group are not being followed. The report states that even though the agreement stipulates that the income from the café should be spent as agreed by both parties, to this date, no income statements of the café had been submitted to the ministry. The report states that moreover, the agreement expired in 2011 and was not extended, but the party continues to operate the café; and the water and electricity bills of Muni Ufa Café are paid by the ministry.

The Auditor General had advised to take action according to the Finance Act against those responsible for failing to stop the café being operated against the terms of agreement. He also advised ACC to investigate the matter and take action against those responsible with reference to article 13 (a) of the Act on Prohibition and Prevention of Corruption, as the State has not received its due benefits from this operation.