The SIU has hailed the decision of the Special Tribunal, which ordered that the two companies which built a multi-million rand border fence must forfeit any profit from the project.

On Tuesday, Special Tribunal judge Lebogang Modiba ruled that the two companies — Caledone River Properties and Profteam — which were awarded the tender to build the fence cannot enjoy profits that they gained from the R40m contract.

Kaizer Kganyago, spokesperson of the SIU, said the judgment sends a strong message to those involved in maleficence.

“It means a lot for us because it shows that this thing we talk about of consequence management. When people feel that when they do things wrong, they then suffer the consequences. Now they have done the work but they will not enjoy the profits of the work they did,” Kganyago said.

Caledone River Properties and Profteam were awarded a R40m contract in the beginning of the hard lockdown in 2020 to build a 40km fence along the SA and the Zimbabwe Beitbridge Border Post to secure borders during the pandemic.

Soon after the companies constructed the fence, it started to fall apart, prompting the SIU to investigate the awarding of the contract.

In July 2021, the tribunal set the contract aside on mutual agreement between the parties.

This was after the SIU had already been able to stop the remainder of payments to the two companies. Payments of R21.8m and R1.8m had already been made to the companies.

But the SIU then wanted that the amounts paid to the companies be paid back. Alternatively, the SIU wanted an order divesting the companies of the profits they derived from the contracts.

Modiba ruled that it was just and equitable to apply the “no profit and no loss” principle.

“In the present circumstances, this relief is fair to all the parties [and] vindicates the values of fairness, equity, transparency, competitiveness and cost-effectiveness that were disturbed when the [two companies] were awarded the contracts unlawfully.

“It also entrenches the rule of law by ensuring that while [Caledon River and Profteam] are not left worse off as a result of the invalidation of the contracts, they also do not benefit from unlawful contracts,” Modiba said.

Modiba ordered that within 30 days the companies file audited statements and statements of their income and expenditure in the contracts supported by an expert report “as necessary in the circumstances”.

Last year, public works and infrastructure minister Patricia de Lille, who was criticised for the tender, told the national council of provinces that a technical team discovered that the fence was not fit for purpose and therefore had to be taken down.