The Public Procurement and Disposal of Public Assets Appeals Tribunal has struck out a challenge against National Medical Stores’ decision to award a lucrative medical distribution and trucking contract to Klan Logistics Limited, ruling that the applicant failed to comply with mandatory procurement review procedures.
In a decision delivered on October 23, 2026, the tribunal found that the application was incompetent on two legal grounds: part of the challenge was filed outside the prescribed time limit, while another part was brought before the applicant exhausted the required administrative review process.
The ruling effectively clears the way for the procurement process to proceed without the suspension order that had temporarily halted the process, although the tribunal did not determine the substantive merits of the applicant’s complaints about the evaluation of bids.
The tribunal, chaired by Francis Gimara, SC, ordered that the application be struck out, vacated its October 5, 2026 suspension order and directed each party to bear its own costs.
How the NMS contract dispute unfolded
The dispute arose from a procurement advertised by National Medical Stores on July 8, 2026, for the provision of last-mile distribution and trunking services under a 36-month framework contract.
The procurement, referenced NMS/NCONS/25-26/00125, was divided into two lots: the distribution of medicines and other medical supplies to their final destinations, and the transportation of medicines and other medical supplies.
Four bidders participated in the procurement: Threeways Shipping Services (Group) Limited, Klan Logistics Limited, Prota Holdings Limited and Blue Pearls Co. Limited.
On September 8, 2026, NMS published its initial Notice of Best Evaluated Bidder, naming Klan Logistics Limited as the successful bidder for both lots.
Klan was identified as the best evaluated bidder for Lot 1 at UGX 1,838,872,873 and Lot 2 at UGX 660,340,175.
The other three bidders were unsuccessful.
The initial evaluation notice cited several deficiencies in the applicant’s bid, including issues relating to bid validity, the technical compliance sheet, the delivery schedule, relevant experience, vehicle ownership or leasing, and registration with the relevant authority.
The unsuccessful bidder challenged its elimination and sought an administrative review.
NMS rejects additional bid documents
On September 11, 2026, the applicant lodged an administrative review complaint with the NMS Accounting Officer, seeking reconsideration of its elimination and consideration of additional bid documents.
The Accounting Officer recalled the initial best evaluated bidder notice on September 14, 2026, after which another bidder, Blue Pearls Co. Limited, also requested an administrative review.
On September 16, the Accounting Officer decided that the original bids should be re-evaluated based on the documents submitted by the August 4, 2026 bidding deadline.
The Accounting Officer declined to accept additional documents submitted by the applicant after the deadline and returned the UGX 5 million cheque it had paid as the administrative review fee.
The applicant interpreted the return of the cheque as an indication that its complaint had been upheld and asked NMS to consider an additional copy of its bid.
However, in correspondence dated September 21, 2026, the Accounting Officer reiterated that the re-evaluation would be confined to bids submitted by the original deadline.
The applicant continued to insist that another copy of its original bid should be admitted as evidence during the re-evaluation.
On September 25, 2026, NMS published a revised Notice of Best Evaluated Bidder, again selecting Klan Logistics Limited for both lots.
The revised notice cited bid validity, insufficient technical details, the delivery schedule and inadequate proof of 20 qualifying box-body trucks among the reasons for the applicant’s unsuccessful bid.
The applicant subsequently moved to challenge the decision before the PPDA Appeals Tribunal.
Why the tribunal rejected the challenge
The tribunal did not dismiss the application because it had conclusively established that NMS correctly evaluated every bid. Instead, its decision focused on whether the applicant had properly invoked the tribunal’s jurisdiction.
First, the tribunal found that the challenge to the Accounting Officer’s September 16 decision, communicated on September 17, was filed outside the statutory period prescribed under Section 115(2)(a) of the Public Procurement and Disposal of Public Assets Act, Cap. 205.
Second, the challenge to the revised best evaluated bidder notice of September 25 was filed before the applicant had exhausted the administrative review procedure prescribed under Section 106 of the Act.
The tribunal further found that the applicant had not sufficiently established a statutory exception that would allow it to bypass the administrative review process and proceed directly to the tribunal.
The applicant had argued that the Accounting Officer’s earlier consideration of its grievances justified direct recourse to the tribunal. However, the tribunal distinguished the initial evaluation complaint from a challenge to the revised evaluation outcome.
It held that the earlier administrative review did not, by itself, establish that the Accounting Officer was incapable of impartially determining a fresh complaint arising from the revised evaluation.
The tribunal also noted that the applicant had not properly pleaded the relevant circumstances in its original application and could not introduce a new jurisdictional ground through subsequent written submissions.
Consequently, the tribunal concluded that the application was incompetent on both grounds.
Tribunal avoids ruling on substantive procurement complaints
The ruling leaves the underlying technical disagreements over the applicant’s bid unresolved.
Among other issues, the applicant disputed the finding that its bid was invalid because of an inconsistency between the bid data sheet and the bid submission sheet concerning the period of bid validity.
It also contested the finding that it had failed to submit a completed delivery and completion schedule, arguing that the schedule formed part of its original bid but was subsequently omitted or removed during evaluation.
The applicant further challenged its elimination for entering the word “Comply” in the specifications and compliance sheet without providing additional technical particulars.
On the delivery requirements, it argued that the bidding document already prescribed the obligations and performance requirements, making further descriptive information unnecessary.
The tribunal expressly stated that, having found the application incompetent, it was unnecessary to determine the separate objections concerning the applicant’s corporate identity and locus standi, or the substantive grounds challenging its elimination and Klan Logistics Limited’s designation as the best evaluated bidder.
This means the decision should not be interpreted as a substantive finding that every aspect of NMS’s bid evaluation was correct. The tribunal disposed of the case on procedural and jurisdictional grounds.
Suspension order lifted
In its final orders, the tribunal struck out the application and vacated the suspension order issued on October 5, 2026.
The suspension order had temporarily halted the procurement process pending determination of the dispute.
The tribunal also ordered each party to bear its own costs.
The decision was delivered in Kampala on October 23, 2026, by a panel chaired by Francis Gimara, SC, alongside tribunal members Nelson Nerima, Geoffrey Nuwagira Kakira, Paul Kalumba, Charity Kyarisiima and Engineer Cyrus Titus Aomu.
The case highlights the importance of strict compliance with statutory deadlines and administrative review procedures in public procurement disputes. Even where a bidder contests its elimination on technical grounds, failure to follow the prescribed legal process can prevent the tribunal from reaching the substance of the dispute.
