THURSDAY February 17, 2022
By Patty Magubira
The Tranquility News Reporter, Tanzania
The government of South Sudan is facing a civil case at the East African Court of Justice allegedly for violating two contractual obligations, causing a multi-million-dollars loss to a local supplying company.
Lupain Group Inc is asking the regional court to order the South Sudan government to pay it about $92 million stipulated in the two contracts coupled with interest.
In its first application No 38 of 2020, the firm represented by the Nairobi-based Ochieng Opio and Company Advocates claims to have entered into a contract with the government of South Sudan in June 2019 to supply and deliver various units of motor vehicles and equipment for the country’s army.
The South Sudan-based company dealing in automobile, oil and gas, service, Logistics and supplies says the government had on April 29, 2020, issued a Bank of South Sudan guarantee number 004/2020 for payment of over $2 million.
Owing to the government’s failure to honour the bank guarantee contrary to Articles 6(d), 7(2) and 8 of the EAC Treaty, lenders are demanding all credit facilities extended to Lupain Group Inc.
In its second application No 39 of 2020, the firm claims to have entered into another contract with Intertorco Europe SA Limited in 2020 for supplying and delivering to the government 600 motor vehicles.
The government was supposed to pay Lupain Group Inc over $56.7 million in the contract backed by a sovereign guarantee to assign crude oil to the firm.
The government though had on April 29, 2021, issued a bank guarantee No 005/2020 to approve the contract, has neither honoured it nor given any reason contrary to the Articles of the treaty.
Article 6(d) of the treaty on fundamental rights of the community says good governance, including adherence to the rule of law, accountability, transparency, equal opportunities, as well as the recognition, promotion and protection of human and peoples’ rights in accordance with the provision of the African Charter on Human and Peoples’ Rights.
Article 7(2) on operational principles of the community, in turn, says the partner states undertake to abide by the principles of good governance, including adherence to the rule of law, social justice and the maintenance of universally accepted standards of human rightsΩ