An audit report has uncovered serious irregularities in the awarding of a multimillion-euro contract for the construction of Bangladesh’s chancery complex in Berlin, raising concerns over violations of public procurement rules and possible unethical practices.
The report alleges that an “ineligible” and “non-responsive” bidder was awarded the contract, despite failing to meet key requirements outlined in the tender.
According to the findings, the tender evaluation committee – headed by former ambassador to Germany Md Mosharraf Hossain Bhuiyan – did not adhere to the Public Procurement Regulations (PPR-2008), ultimately granting the contract to Mabco Construction, a subsidiary of the Mabetex Group.
The company is owned by the family of Behgjet Pacolli, a former president of Kosovo.
The audit identified a total of 45 different irregularities in the mission, with the most significant involving the awarding of a contract worth over 12.8 million euros (approximately Tk175 crore).
The audit committee has recommended that authorities take appropriate measures to determine accountability, particularly in what it described as an initiative to construct a potentially substandard chancery building through an irregular tendering process.
Tender process and initial evaluation
The tender process for the chancery construction began in 2022, with notices published in July of that year in two German newspapers and on two reputable online platforms. Five companies participated in the bidding process, of which three – CZIZZ GmbH, Mabco Construction, and Dechant GmbH – were shortlisted for technical evaluation.
A technical evaluation committee (TEC), led by the then ambassador and comprising six other members, oversaw the selection process. To ensure transparency and technical accuracy, a well-known German consulting firm, Peter Ruge Architekten, was engaged to assist in evaluating the bids.
In its formal recommendation, the consulting firm advised awarding the contract to Dechant GmbH, citing its compliance with tender requirements, relevant project experience, and competitive financial offer.
The firm also raised concerns about Mabco Construction’s qualifications, noting that the company failed to provide evidence of at least three projects within Germany, the EU, or Berlin valued at a minimum of 10 million euros within the past three years, which was an important condition in the tender notice.
The report further highlighted that Mabco had submitted only one reference project within the EU—a renovation of the Embassy of Kazakhstan—without disclosing its financial volume. This fell short of the eligibility criteria clearly stated in the tender documents.
Ignored recommendations and procedural violations
Despite these findings, the TEC chairman disregarded the consultant’s recommendations.
Minutes from the committee’s third meeting indicate that the ambassador encouraged members to consider Mabco Construction – the second lowest bidder – as the most eligible candidate, citing its experience and project volume in Europe, even though much of this experience was outside the EU or European Economic Area (EEA).
The audit concluded that Mabco Construction should have been deemed a non-responsive bidder due to its failure to meet eligibility requirements.
Nevertheless, the committee proceeded to award the contract to the company, bypassing both the lowest bidder, CZIZZ GmbH, and the consultant’s preferred candidate, Dechant GmbH.
This decision was found to be in violation of Rule 8 of the PPR-2008, which mandates that contracts should generally be awarded to the lowest responsive bidder. The report also noted that there had been an opportunity to negotiate with a qualified German bidder, as recommended by the consultants, but this option was ignored.
Financial irregularities and audit observations
Among the 45 irregularities identified, one case involving 16,805 euros attributed to former counsellor Kazi Tuhin Rasul was classified as a Serious Financial Irregularity (SFI).
However, a much larger financial discrepancy – amounting to over 12.8 million euros linked to the contract approval under the former ambassador – was categorized as a non-serious financial irregularity, raising questions about the criteria used in such classifications.
The audit report also highlighted discrepancies in documentation submitted by Mabco Construction. The company reportedly failed to provide valid completion certificates for projects in the EU or EEA.
Instead, it submitted self-certified documents regarding project values, which lacked credibility. Initial submissions for projects in Geneva and Paris were undated, and only later were revised documents with dates provided.
Embassy response
In response to queries, the Bangladesh mission in Berlin acknowledged that Mabco Construction did not fully meet the eligibility criteria. Project officer Tanvir Kabir, Counsellor (Political), who was also a member of the TEC, confirmed in a written reply that the company failed to submit proper documentation and did not satisfy the requirements outlined in the tender.
He further alleged that Mabco submitted questionable documents during the bidding process.
According to him, senior officials at the embassy including two members of the TEC were aware of these discrepancies.
Kabir also claimed that the former ambassador did not share the consultant’s evaluation report with TEC members and instead advocated for Mabco’s selection during meetings.
He further stated that approximately 2.5 million euros had been spent on the consulting firm for their consultancy services, including the preparation of tender documents, evaluation of bids, selection of the general contractor, and overall project management.
Despite this significant expenditure, he alleged that the consultants’ recommendations were ultimately disregarded and, crucially, not even presented to members of the tender evaluation committee during TEC meetings. This omission, he suggested, may have been a deliberate attempt to influence and manipulate the tendering process.
He also noted that few, if any, committee members were in a position to challenge the proposal, given the perceived closeness of the former ambassador to the then prime minister Sheikh Hasina.
Denial from former ambassador
Former ambassador Md. Mosharraf Hossain Bhuiyan was the former secretary of the Bridges Division and executive director of the Bangladesh Bridge Authority and he was accused of involvement in a corruption conspiracy regarding the appointment of consultants (SNC-Lavalin) of Padma Bridge.
He was arrested, suspended, and later acquitted after the Anti-Corruption Commission (ACC) found no evidence of corruption. He is perceived to be very close former prime minister Sheikh Hasina who sent him to Germany as ambassador.
When contacted, former ambassador Md Mosharraf Hossain Bhuiyan denied any wrongdoing, asserting that all decisions were made in accordance with established rules. He maintained that the technical evaluation committee collectively made the decisions regarding the contract award.
However, when questioned about his role as chairman of the committee, he appeared uncertain, stating that he could not recall whether he or the foreign secretary had chaired the TEC.
Responding to concerns about ignoring the consultant’s recommendations, he argued that such recommendations are not binding and do not have to be followed in every case.
Calls for accountability
The findings of the audit have intensified calls for accountability and transparency in public procurement, particularly in high-value international projects. The case highlights systemic weaknesses in oversight mechanisms and raises concerns about the potential misuse of public funds.
As the government reviews the audit recommendations, attention will likely focus on identifying those responsible for the irregularities and ensuring that corrective measures are implemented to prevent similar incidents in the future.
