The Ministry of Transport starts a dialogue today, with four bus companies, for an extension through direct negotiation or through a competitive dialogue for up to two years of the existing contracts for the period 2020-2030, which expire in exactly 40 days from today.
These are the contracts for the provinces of Limassol, Paphos, Famagusta and Intercity, for which there has been no conclusion so far in the procedures for the new contracts. In practice, the extensions will take the form of direct assignments for a limited time, as the ministry did not take advantage of the opportunity to extend under the terms of the existing contracts in time, believing that it would have time to complete the procedures.
For the provinces of Nicosia and Larnaca, the contracts have been awarded to the MLKP consortium and so far the ministry has not hinted at an extension. This means that the ministry considers that despite the delays on July 5, the new contractor will have the necessary fleet, will complete the procedures with the staff, etc. will inform the public about any changes in frequencies, routes, etc. and will be fully ready to launch new routes.
It should be noted that the MLKP consortium has leased offices in Nicosia and has hired executives, while the negotiation process for staff transfer continues. Information from "F" states that the new buses ordered will be delivered to China at the end of the month, so there will have to be a road race to be transported to Cyprus, cleared through customs, registered and prepared for itineraries in a timely manner. Respectively, the same procedure applies to the minibuses that will come from Spain. Also, the same information states that a number of used buses have already been transported to Cyprus.
At the same time, OSEL has filed an appeal against the court decisions that left him out in Nicosia and Larnaca, however, if the outcome is justified, it will involve significant damages. Also, the dynamic mobilizations of "Zenon" Larnaca are in progress, claiming the cancellation of the tender, with the reasoning that the same consortium, with the exact same documents can not be valid for two provinces and invalid for two others. The reasoning of the ministry is that it was a tender for six distinct contracts, however things are complicated since the same bidder could submit bids for all contracts.
For the provinces of Famagusta and Intercity, the extension period can not be clear due to the many open issues that exist, as there are corresponding Court decisions that characterized as illegal the decisions of the Ministry of Transport for assignment to the same consortium (MLKP) due to irregularities in relation to the terms of the competitions.
The Ministry of Transport has sent the new contracts to the Evaluation Committee, in order for them to re-evaluate the suitors and make a decision based on the court decisions that effectively exclude the consortium. However, for the time being, all possibilities are open, with OSEA (Famagusta) and Intercity (long distance). If the assignment is made soon to the existing providers, the negotiations for the extension, which are scheduled for the current week, will obviously be easier for both the ministry and the existing providers, however this is not expected to be clear at least at the beginning of the negotiations. .
According to information from "Φ", the MLKP consortium filed an appeal a few days ago for the court decisions that considered its offers illegal.
With Limassol (EMEL), where the tender was canceled, after the company had submitted a bank guarantee with the wrong date and the MLKP consortium had already been awarded the maximum number of contracts, negotiations to extend the provision of services will not be easy. Critical issues will be the extension time, with the relevant European Directive allowing direct assignment for up to two years.
Similar moves will be made in relation to the contract of the province of Paphos, which was also canceled for the same reasons.
With a heavy whip and a small carrot
As it will take at least four months to announce a tender, clarify, submit and evaluate bids, another 4-5 months for appeals to be considered certain, some time to sign the contract and another six months to prepare the contractor for operation under the new contract, the minimum expected extension will be in the range of 16-18 months. In any case, due to the complications that student itineraries bring to such a transition, the planned undertaking by the contractor of the new contracts, should be done during a student holiday period so that the transition is smoother.
Also, in the economic aspect, the existing organizations are expected to request a "closed" fixed compensation per kilometer, which covers the cost, with only variables the cost of fuel and labor costs. Also, any agreements should be considered viable by the banks that finance the organizations. A big thorn in the side are the financial disputes over existing contracts, with companies claiming to have been overpaid and the Department of Transportation considering paying the costs it estimates should have been.
Also interesting is the strategy set by the ministry for the extension negotiations, which uses the "threat" of assigning to another body in the provinces that will be given an extension, if it deems that it is at a dead end. According to the ministry, it will use the indicators set by the Dispute Resolution Committee, which has examined similar issues in the past, as a measure of the amount of compensation. Also, the ministry indicates that in case there is no common ground in the negotiations for the extension of the contract, it has as its weapons the possibilities for imposing an obligation to provide public service.
Source: philenews