Law: Public Procurement Regulatory Authority Ordinance (XXII of 2002)

Section: 2(j),2(k)

Law: Constitution of Pakistan, 1973

Section: 199

(a) Public Procurement Regulatory Authority Ordnance (XXII of 2002)-- ----Ss. 2(j) & 2(k)---Public procurement---"Procuring agency" definition of---Public funds---Scope---Question before the High Court was whether the respondent Company, which was a public limited company with shareholding of the Federal Government at 60%, fell within the definition of "procuring agency" under Public Procurement Regulatory Authority Ordinance, 2002---Contention of the petitioner was that respondent Company could not have awarded a contract for procurement without inviting tenders in terms of the Public Procurement Regulatory Authority Ordinance, 2002---Contention of respondent Company was, inter alia, that it did not fall within definition of "procuring agency" in terms of S.2(j) of the Public Procurement Regulatory Authority Ordinance, 2002---Validity---Section 2(j) of the Public Procurement Regulatory Authority Ordinance, 2002 defined "procuring agency" to mean, amongst others, any corporation, body or organization established by or under a Federal Law or which was owned or controlled by the Federal Government and similarly "public fund" included the funds of enterprises which were owned and controlled by the Federal Government ---Catchword in both definitions was "owned and controlled by Federal Government" and the said expressions "owned" and "controlled" had been used disjunctively and both needed to be present in a corporation (company) before it could be said to fall within definition of procuring agency"---In a limited liability company there was some divorce of ownership from control and was particularly so in public imitated companies where the ownership (theoretically) rested with a large and diverse body of shareholders but the control (management) rested with directors---In the present case, two groups of shareholders through Memorandum of Understanding brought about a change in the corporate governance structure of the respondent company by deciding to take all decisions through consensus and such consensual arrangement over decision making in the respondent company made it impossible for the respondent to be termed as an enterprise owned and controlled by the…

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