Thursday, October 21, 2004

Unmik cancels Kosovo mobile phone tender - UPDATE

1 comment:

KosovaReport said...

The head of the United Nations

mission in Kosovo (UNMIK) has annulled the tender process for Kosovo's

second mobile phone company, which was won by a local consortium

affiliated with Slovenian company Mobitel, because of "serious flaws" in

the process. However, UNMIK has not been able so far to provide details on

what these alleged flaws were.

According to a press release from UNMIK, its head Soeren Jessen-Petersen

issued an executive decision to cancel the tender process on Wednesday.

Petersen took this decision after it became evident that the selection

procedure, which was won by the Mobikos consortium, "had been seriously


However, UNMIK was unable to respond to an STA request today that it

provide further details on the "serious flaws" found by an independent

audit team in August. According to UNMIK press officers, Mechthild Henneke

and Jeff Bieley, the audit report, which UNMIK has referred to throughout

in calling for the tender to be annulled, is a classified document.

UNMIK said today that the decision to annul the tender process was "in the

best interests of Kosovo and its economic development, in particular its

ability to attract investment".

The announcement of the annulment came within an hour of Mobitel's

revelation that the Mobikos consortium signed Thursday the EUR 6.5m

concession contract with the Kosovar Telecommunication Regulatory

Authority (TRA).

In response to UNMIK's announcement, Mobitel, Slovenia's largest mobile

services company and a subsidiary of the state-owned telco Telekom, said

it was surprised with the decision taken by Jessen-Petersen. Mobitel said

it would "examine thoroughly" the current situation, adding it would be

taking legal action if that proved necessary.

"Such a development is mostly to the detriment of mobile

telecommunications users in Kosovo," the Mobitel press release said,

adding that competition was the only way to improve mobile phone services

in Kosovo.

In its press release, UNMIK suggests that the TRA and its chairman Anton

Berisha in particular were to blame for the chaotic situation: "UNMIK

regrets that the chairman of the TRA went ahead with the signing...without

prior notice to UNMIK or to the government."

"The action of the chairman was in disregard of an instruction to take no

further action on this tender that had been given to him [by UNMIK] in

June," the press release says, adding that Berisha's move was


Berisha recently told a Slovenian paper that UNMIK no longer insisted that

the tender for a second mobile telephony provider in the province had to be

annulled or that the irregularities found in the selection procedure could

not be fixed.

In the 1 October Delo interview, Berisha criticised UNMIK for its

authoritarian handling of matters in the province. "We'll not accept

dialogue in terms, we are the UNMIK and we declare the tender invalid. If

this happens, and the UNMIK gets to decide about everything, there's no

point in holding a general election in Kosovo at all."

He said the person he found most responsible for the complications

surrounding the tender was Charles Brayshaw, the former acting UNMIK head,

whose term in office ended at end of September.

"The issue is no longer about the mobile telephony tender, Mobitel, or

whose analysis is more reliable. Honestly, I don't accept the logic that

the international community, with all due respect for what it has done for

Kosovo, can decide just about everything on our soil," Berisha says.

The Kosovo Agency for Telecommunications selected Mobitel and its Kosovo

partner Mobikos as the second mobile provider in the province last June,

but Kosovo Prime Minister Bajram Rexhepi requested an opinion on the

matter from UNMIK.

Interestingly, this was supposed to be the first tender process managed

fully by local authorities since the arrival of UNMIK in 1999.

An independent audit team, headed by the international auditing firm HELM,

reviewed the tender process and, according to UNMIK, found serious flaws.

Details of the findings have been very sketchy; back in August an UNMIK

press release said that "instances of serious non-compliance within the

pre-qualification evaluation, compliance errors, and inconsistencies

throughout the tender process" had been found.

Apart from Mobitel's local partner, five other companies entered bids for

the second mobile services license in Kosovo, among them Swedish Tele 2,

the consortium IPKO, linked to the US Western Wireless International,

Albacell (Norwegian Telenor and Siemens), and Kostel (Orange Group).

Among the losing companies, Western Wireless International has been the

loudest in calling for the annulment of the selection process, claiming

that the whole procedure was rigged.

Local media have reported that US and British diplomatic missions in

Kosovo, as well as a US lobby firm, have also lobbied UNMIK for the

annulment of the tender.