SriLankan airlines duty free contract awarded without a tender

SriLankan airlines duty free contract awarded without a tender

Written by Zulfick Farzan

26 Jun, 2018 | 12:57 am

COLOMBO (News 1st) – SriLankan Airlines had given the entire in-flight duty-free process to Phoenix Duty-Free Services without following a tender procedure. This revelation was made at the Presidential Commission of Inquiry today (June 25).

Rashmore Ferdinands, the In-Flight Services Manager as SriLankan Airlines said in 2011 when tenders were called to supply perfumes and cosmetics for duty-free sales, several bidders had come forward and they included Phoenix Rising Ventures (PRV), International Sales Group and King Power Limited.

International Sales Group, however, had highlighted none of their partners or affiliated companies were permitted to bid for this particular tenders using its name or brand. Surprisingly, Phoenix Rising Ventures had submitted a tender stating it had been included in the business for 20 years through International Sales Group and it’s affiliated companies.

Another surprising factor was that the letters submitted by PRV from suppliers authorizing PRV to sell their good were identically worded and the only difference was the signature and name of the supplier. All letters stated, PRV was the winner of the SriLankan Airlines contract and they are interested in supplying their goods but the letter of intent is not a contract.

It appears Phoenix Rising Ventures had informed the suppliers they had won the tender even before the tender was opened. As the Senior Tender Board had recommended to award the tender to PRV an offer letter was sent to them requesting them to accept, sign and return the document.

A factor that came to light at the commission was SriLankan Airlines had made their initial purchase order of the duty-free goods before even signing an agreement. This particular contract was only for a period of six months.

One month later rather than reverting on the offer, PRV had sent a proposal addressed to the Chairman of SriLankan Airlines Nishantha Wickremesinghe and CEO Kalila Chandrasena. PRV had proposed to move away from only supplying fragrances and cosmetics and wanted SriLankan Airlines to outsource the entire duty-free program to them for a period of seven years.

The proposal, though addressed by PRV, says the process will be taken care of Phoenix Duty-Free Services based in Sri Lanka and was signed by Dilan Weerasinghe as the CEO. PRV had given the proposal directly to the Chairman and CEO of SriLankan Airlines and they had, in turn, handed it to the Board of Directors for Approval.

It had been simply approved by the board deviating from the usual norm of following a tender procedure. Another surprising factor was that at the same time King Power Limited, which is chaired by Rakitha Jayawardena had also submitted an alternative proposal similar to what was submitted by PRV.

Despite prevailing public outcry, the questioning of witnesses at the Presidential Commission of Inquiry led much to be desired of. The people saw how Prime Minister Ranil Wickremesinghe, Ministers Kabir Hashim, and Malik Samarawickrama were questioned with Kid Gloves on.

To add insult to injury it was reported that a commissioners family member worked for MP Harsha De Silva based at Temple Trees while the inquiry was still going on. Following the conclusion of the Presidential Commission of Inquiry, there were allegations of the Commission report making its way to a certain residence before it was released.

Subsequently, certain names were withheld for ostensibly secrecy considerations and the President’s Secretary proceeded to archive parts of the Bond Commission Report for reasons best known to him. It is in the light of this tomfoolery and displaced public trust that a Commission was appointed to investigate SriLankan Airlines.

We as journalists continue to report the days’ proceedings from the Presidential Commission of Inquiry. Our only hope is that in the days weeks and months to come we won’t have to report on similar tactics of aversion and mischief.

The Commission, Commissioners and all those involved, must remember that they will be judged by the public.

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