High court drama expected as the battle for investment in Durban container terminal heats up
International Container Terminal Services (ICTSI) is tomorrow (4 December) launching its appeal in the Durban High Court over the interdict that is stopping Transnet from implementing the proposed public-private partnership agreement to run Durban Container Terminal Pier 2.
The dispute follows the July 2023 decision by Transnet to award ICTSI, a global Top-ten firm that runs 32 port terminals in 19 countries, the contract to run the Container Terminal.
An ICTSI statement said this was done following a rigorous and transparent bidding process.
Maersk, through its subsidiary APM Terminals, was one of the failed bidders and approached the courts this year to overturn the contract on what ICTSI called a non-material technicality.
In October the KwaZulu-Natal High Court ordered Transnet to halt further implementation of the agreement until the matter could be considered in court.
ICTSI will be in court appealing the interdict and the company said it believed that the court ”erred significantly” in granting the interdict.
The full review of the awarding of the contract by Transnet to ICTSI, lodged by Maersk, will still proceed in March 2025 regardless of the outcome of ICTSI’s application for leave to appeal.
The appeal does not impact the timeline or court dates of the main case.
The company said that, should the appeal against the interdict be successful, Transnet may continue to implement its agreement with ICTSI in parallel to the main case’s processes.
ICTSI also said Maersk had misleadingly argued that it did not meet a non-defined definition of solvency – a metric used to show its financial ability to meet its obligations.
“ICTSI disputes Maersk’s narrow interpretation of how solvency should be calculated and disputes that the matrix was a mandatory pass/fail,” it stated.
A specific equation to calculate solvency was not prescribed in the tender documents, it continued, arguing its measures were a reasonable option which it had always been open and transparent about using.
Transnet’s auditors reviewed and accepted the measure during the bidding process.
“What is critical and material is that ICTSI had – and still has – the financial capacity to perform on the terms of the contract,” said Hans-Ole Madsen, regional head for Europe, Middle East and Africa of the ICTSI.
”Transnet and their auditors were satisfied of this when it took the decision in July 2023 and again re-confirmed by an independent confirmatory due diligence conducted by Transnet,”
While the interdict against the partnership was granted against Transnet and not ICTSI, the global firm asked for leave to appeal as findings made by the court were said to be damaging to its reputation and “had no basis in fact”.
