Foundation for Medical Services states its position

The recent press conferences, press reports and other public declarations have constrained the Foundation for Medical Services to clarify any misconceptions that may have been created as a result of inaccurate and sometimes misleading information appearing in the media.

The comments are limited to those areas involving the FMS relating to the recent clarification exercise carried out with Simed International BV.

The foundation rebuts, in the strongest terms possible, Simed's repeated claims that no proper clarification exercise was carried out.

The appeals board recommended inter alia that "clarification regarding all items and areas highlighted by the technical, financial and legal advisers commissioned by the adjudication board should be sought and obtained in writing from Simed International BV". It further recommended that "this exercise should be carried out in strict compliance with the provisions of clause 26.1 of the tender documents and within a time scale which fully safeguards the public interest".

For the benefit of the public, clause 26.1 imposes certain restrictions as to how a clarification should take place and specifically states inter alia that "the request for clarification and the response shall be in writing and no change in the prices or substance shall be sought, offered or permitted". Within this context, the foundation maintains that it carried out the clarification exercise strictly in terms of the recommendation of the appeals board.

When advising Simed on November 3, 2003 to provide clarifications, the FMS enclosed the detailed reports of the technical, financial and legal advisers. These reports clearly showed the items and areas which needed clarification and which the appeals board described as items and areas highlighted by the technical, financial and legal advisers - a statement which indicated that the items and areas which needed clarification were clearly identified in the said reports. Therefore, no further amplification was required on the part of FMS.

The truth of the matter, and this is well known to Simed, is that, in the final analysis, it was not a matter of Simed not being given the opportunity to clarify but rather that, in order to render their bid more compliant, it was necessary for them to effect changes or modifications and this would have been inadmissible both from the tender documents point of view and in terms of the criteria established by the appeals board. The attempts by Simed to give the impression that "their offer was not re-evaluated" as quoted in the press are inexplicable.

With regard to the reported statement that "Simed was considered a favourite to be awarded the Lm25 million contract", this is somewhat gratuitous. Simed were fully aware that there were a number of deficiencies in their bid, which were highlighted in the reports of the experts which had to be clarified. They were also aware, as explained earlier on, that clause 26.1 and the appeals board recommendations imposed strict restrictions with regard to the procedure to be adopted during the exercise. The report by the advisory board, chaired by an independent retired judge which, in turn, was guided by the legal, financial and technical experts, shows conclusively that Simed's overall response was not substantially responsive as required by the appeals board report.

Simed has also been reported as having stated that, despite repeated written questions, FMS refused to "be specific as to which areas needed clarification" and that "FMS gave very generic replies and that this effectively left Simed with five working days to finding out what their outstanding matters were".

The FMS reaffirms that the reports of the technical, financial and legal advisers which were made available to Simed were far from generic. In fact, they were most specific when referring to items and areas which needed to be clarified by Simed. It is indeed surprising that a company of Simed's standing should find it difficult to identify such items and areas which, as stated in the appeals board report (a copy of which was also made available to Simed), were "highlighted" in the reports of the technical, financial and legal advisers. Furthermore, the appeals board report also identified items and areas needing clarification by Simed.

Simed's claim that they were left with five working days to finalise their clarifications cannot be taken seriously. They were in fact given 15 days with effect from November 3, 2003 to provide FMS with the necessary clarifications. Indeed, they were in possession of the relevant reports on which they were to base their clarifications well before FMS advised them to do so, as the relevant parts of the advisers' reports were handed to them at the appeals board hearings.

It would thus not be unreasonable to expect that a company with Simed's experience would have commenced their task immediately after the appeal board's recommendations were published on October 28, 2003.

The five working days quoted by Simed therefore does not hold water.

Note should also be taken that the exchange of correspondence between the FMS and Simed leading up to Simed's response on November 18, 2003, was carried out in full consultation with the director of contracts and was guided by legal advice.

Simed were also reported to have stated as follows:

"On November 18 Simed submitted a comprehensive report with its clarifications to the expert's reports. However, in normal circumstances, these would not need more than a few days to evaluate. After this we never received any reply to our clarifications nor any request for further clarifications, despite our written request on December 5 as to whether our clarifications submitted were clear and sufficient. Rather than approaching Simed for further clarification, they (FMS) suddenly decided on December 26 it was time to act."

The above statement is totally misleading. The facts as the foundation knows them are the following:

1. Simed's report of November 18, 2003 was immediately passed on to the independent advisory board appointed by the FMS for their evaluation. The fact that no further clarifications were deemed necessary by the advisory board is to be interpreted that the advisory board had all the clarifications necessary to reach a conclusion according to the criteria laid down by the appeals board.

2. With regard to the alleged written request by Simed of December 5, it should be noted that the FMS never received this letter. It is however odd that on the same day - December 5, 2003 - the FMS's CEO received a telephone call on his mobile from a person who identified himself as the chairman of Simed and who stated that Simed were able to meet with Secta's representative, as he was informed that the latter representative was in Malta. FMS has a signed declaration from its CEO to this effect. Simed are fully aware that such approaches are strictly prohibited both by clause 26.1 of the tender documents and by the appeal board's ruling.

3. With regard to the alleged "sudden decisions by FMS on December 26" it should be borne in mind that the FMS appointed an advisory board which had been deliberating on the Simed response since their first meeting on November 20 which was followed up by several meetings. Furthermore, the report presented to the FMS board regarding Simed's level of responsiveness was clear and conclusive and the FMS board did not find it difficult to confirm and adopt the report of the advisory board and pass it on to the director of contracts immediately.

Simed are also reported to have stated that "together with its clarifications, Simed also submitted copies of documentation enclosed with its original bid. However, from the confidential board report, it is clear that FMS had not made these documents available to Secta..."

Wrong again. A box containing all these documents was made available to SECTA. In fact, the board sent one of its staff members to London to hand carry and deliver the box containing the documents in question personally to Secta. Subsequently, the advisory board requested that the representative from Secta comes over to Malta to further evaluate Simed's original bid document and be given access to such documents for him to be able to arrive at his expert opinion.

Regarding the confidential board report originally erroneously referred to by Simed in one of its declarations as "FMS letter dated December 26, 2003", it would be best not to comment further on this sensitive matter. However, we are certain that Simed are fully aware that it is not a matter of the "government not expecting the aforementioned report to leak out", as Simed so frivolously tried to convey.

We are also equally certain that Simed are fully cognizant of the ethics and proper code of conduct associated with board papers. In any case, the board report merely quoted facts which were highlighted in the various experts' reports, copies of which had been made available to Simed, and details of the report by the advisory board, copies of which were eventually handed to the press by the Minister of Finance. There is therefore nothing sinister about the board paper in question.

Finally, the FMS wishes to put on record that its recommendation and that of the advisory board was limited to Simed's responsiveness or otherwise to the clarification exercise as dictated by the appeals board.

The recommendation of the FMS board to the director of contracts to treat the matter with urgency, which would be most beneficial to the Mater Dei Hospital project, merely echoed the consistent documented recommendations to the government over the last six months that the medical equipment tender needs to be resolved sooner rather than later, as the delay is fuelling additional and substantial costs to the project. It is therefore not a recommendation or decision which was taken at the 11th hour, as Simed are implying.

Mr Formosa is president of the Foundation for Medical Services.