A call for expressions of interest for a €8.6 million e-learning project was scrapped after a government-appointed consultant was connected to one of the bidders, Information Technology Minister Austin Gatt said.
Dr Gatt said in Parliament he cancelled the tendering process as soon as he was informed that one of three technical consultants involved in the adjudicating process, Laurie O'Donnell, had commercial links to a bidding company.
The tender was issued by the Malta Information Technology Agency and consisted in a call for expressions of interest for "a strategic partnership for the provision of an e-learning solution" that closed on November 11.
Dr Gatt cancelled the tender on April 28 after being briefed during a meeting he had with Mita's chairman and CEO.
UK firm IT Consulting Services, made up of Mr O'Donnell, Tom McMullan and Owen Lynch, was chosen, through a separate tender, to help in the process.
Labour MP Evarist Bartolo, who raised the issue through a parliamentary question, was not satisfied with the government's reply.
"I'm convinced we have not heard the full story. I find it very strange that the government only found out about the conflict of interest in May when the adjudication process took place in November," he said when contacted.
Mr Bartolo believes the tendering process was called off not because of a conflict of interest but because "certain" companies might not have been able to submit their offer. He did not elaborate.
In a detailed reply to Mr Bartolo's question yesterday, Dr Gatt insisted he was never personally involved in the adjudicating process and said Mr Bartolo's conclusions were imaginary and malicious, based on his fertile imagination.
The call for an e-learning project, which would shift school lessons online, was cancelled after the minister was informed Mr O'Donnell was linked to a sub-contractor of one of the bidders. As a result, he was excluded from the process.
Nine companies submitted offers: Benchmark Softec (P), Excelsoft Technologies Pvt and Digital Borneo consortium, Blackboard International BV and Loqus Solutions Ltd consortium, eLP + Consortium, Fronter as, Hewlett-Packard International Trade BV, IBM Malta Ltd, IX consortium, Megabyte and SIVECO Romania SA consortium, and Young Digital Planet SA.
Dr Gatt said Mr O'Donnell was excluded from the process in December by the tender's evaluation board after it was informed about the conflict of interest.
In March, Mita's chairman and CEO were told about this for the first time by a bidding company - Excelsoft Technologies Pvt and Digital Borneo consortium -pointing out that excluding Mr O'Donnell might not have been enough.
Seeking legal advice, Mita's CEO was told the evaluation board acted correctly in excluding Mr O'Donnell and the selection process was technically not compromised, Dr Gatt said.
However, Mita's lawyers also pointed out that, while the board acted correctly, there could still be grounds for speculation and Mr O'Donnell's exclusion was not enough. Consequently, the evaluation board was asked to send another report to the CEO on April 9, Dr Gatt said.
During a meeting with the minister, Mita's board of directors explained that, although everything was legally correct, there was a risk the situation could not guarantee the independence of the two other consultants - Tom McMullan and Owen Lynch.
Dr Gatt added he had decided to issue a fresh call for expressions of interest as soon as he heard of the case without waiting for legal advice or knowing who had submitted bids or was shortlisted.
A ministry spokesman said it was unlikely the EU funds would be lost because the tendering process was still in its early stages. The new call would be issued in the coming weeks, the spokesman added.