Friday 29 Mar 2024
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KUALA LUMPUR (Feb 21): Datasonic Group Bhd has reiterated that the Government contract to supply passport chips to the Immigration Department of Malaysia was granted to its subsidiary after a “full evaluation and compliance with all due processes”.

The contract was given to Datasonic Technologies Sdn Bhd (DTSB) in mid-December 2015 — 16 months after an unsatisfactory performance report was issued on DTSB by the Ministry of Finance (MoF) in August 2014 — said the e-government service provider in a filing with Bursa Malaysia today.  

Datasonic also noted that the MoF already gave approval to KDN (Ministry of Home Affairs [MoHA]) to proceed with all the required procurement procedures related to DTSB’s proposed supply of 12.5 million units of passport chips to be embedded into polycarbonate data pages supplied by DTSB.

“We therefore refute the news articles which gave wrong and misleading perception to readers that DTSB had secured the passport chips contract despite underperformance or unsatisfactory record, as published, instead of through merits after 16 months of full and in-depth evaluation by KDN (MoHA) and MoF,” said Datasonic.

Datasonic has been implicated in some of the charges against former Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi, who was accused of having received two cheques totalling RM6 million from a Datasonic director for the contract.

One of the articles referred to by Datasonic in its filing today is entitled, "Datasonic unit got passport chip contract despite unsatisfactory record" which was published by The Edge Financial Daily on Feb 13.

The article quoted prosecution witness Dr Uzailee Abdul Latiff, who was testifying in Ahmad Zahid's graft trial, as saying that DTSB managed to secure an RM318.75 million passport chip contract in November 2015 from MoHA via direct negotiation, despite having an unsatisfactory track record.

Uzailee was previously MoF's deputy secretary-general in charge of procurement.

Uzailee told the court that DTSB had sought a direct negotiation of the contract that involved the supply of 12.5 million polycarbonate biodata pages with passport chips via a letter dated May 26, 2014, that was addressed to former Finance Minister Datuk Seri Najib Razak, who was also the Prime Minister then.

Subsequently, MoHA wrote to Uzailee in August 2014 to say that DTSB’s previous performance had been unsatisfactory as there had been frequent delays in the supply of the polycarbonate pages, which had affected the performance of the Immigration Department.

MoHA's letter, which came in response to an enquiry on DTSB by Uzailee, also said it had no intention of nominating DTSB for future procurements.

Instead, MoHA said it would maintain its existing contract with Percetakan Keselamatan Nasional Sdn Bhd for the printing of passports, and keep IRIS Corp Bhd for the supply of chips due to their “exemplary performance”, said Uzailee when he read out his witness statement.

However, MoF and MoHA officials had a discussion with DTSB three months later in November during which DTSB said it could save the Government RM103.49 million if it was awarded the project, Uzailee said. On hearing that, the MoF wanted “to evaluate DTSB’s systems and whether its passport chips adhered to international standards”, he told the court.

But DTSB subsequently negotiated the contract directly with MoHA and was eventually awarded the job for five years.

Nonetheless, Datasonic rebutted in its Bursa filing today that DTSB had, in April 2015, passed various tests in Proof of Concept (POC), User Acceptance Test (UAT) and Final Acceptance Test (FAT).

“After fulfilling all the procurement processes, MoF had decided to approve the contract for the supply of passport chips to DTSB based on direct negotiation with DTSB,” said Datasonic.

It stressed that the award of the contract to DTSB for the supply of 12.5 million Malaysian Passport Chips for a period of five years commencing from Dec 1, 2016 to Nov 30, 2021 for the contract sum of RM318.75 million was done vide a letter of award dated Dec 15, 2015.

It also commented on Uzailee’s testimony about the frequent delays in the supply of polycarbonate pages by saying that “the alleged shortage in passports which had affected the immigration services was in fact caused by other vendor(s)”.

According to Datasonic, the Government wanted to clear its inventories of old laminated passports in early 2013 and migration to new passports started in April 2013.

“The actual demand of new passports for the whole year of 2013 was only 1.703 million units. Therefore, the total delivery of 2.34 million units of high quality polycarbonate data page without chip by DTSB in 2013 was 637,467 units or 37.4% more, which had in fact met the requirement as clearly stated in the delivery schedule that actual delivery must be based on current demand of passports by Immigration Department of Malaysia (JIM) (Jadual adalah tertakluk kepada keperluan semasa Jabatan Imigresen Malaysia),” said Datasonic.

As at September 2014, DTSB had delivered a total of 4.609 million units of polycarbonate data page without chip against the actual demand of 3.497 million passports, the company added.

“There was no service interruptions faced by JIM as of September 2014 because the stock level of polycarbonate data pages without chip was 1.112 million units or 31.8% higher than the actual demand,” it said.

Datasonic also said it had also highlighted to the then Government that DTSB’s proposed chip to be embedded in the polycarbonate data page was of the latest technology used by many developed countries, and of higher quality and security standing against the then 15-year old technology of putting the chip in the back-cover of the paper based passport booklet by a previous vendor.

“The company had also highlighted that the estimated savings to the Government will be approximately RM75 million,” it added.

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