What impact will the stay order have on the KVDT2 project tender?

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Stay Order Halts KVDT2 Project Tender Process

Dhaya Maju LTAT Sdn Bhd has successfully obtained a stay order on the government's decision to call for a public tender for the Klang Valley Double Tracking Phase 2 (KVDT2) project. This stay is in effect pending the resolution of their judicial review application, which challenges the government's prior decision to terminate the contract. The judicial review seeks to invalidate the termination and the subsequent move to re-tender the project.
Implications of a Stay Order on Tendering

Generally, a stay order on a public tender process effectively freezes all related activities. This means the government and relevant ministries are prohibited from proceeding with the advertisement, evaluation, or awarding of any new bids for the KVDT2 project while the legal challenge is ongoing. Such a pause is typically implemented to preserve the status quo and prevent irreversible actions from being taken before the court has made a final determination on the validity of the contract termination.
Impact on KVDT2 Project Timeline and Budget

The immediate consequence of this stay order is a significant disruption to the planned timeline for the KVDT2 project. The government's intention to re-tender the project indicates a desire to move forward with new contractors, a process that would now be indefinitely delayed. This delay could potentially lead to increased project costs, as extended legal proceedings and the subsequent re-initiation of a tender process, if the judicial review is unsuccessful, often incur additional administrative and financial burdens.
Judicial Review Proceedings

The judicial review application was initiated by Dhaya Maju LTAT in September 2020, naming the government and the Transport Minister as defendants. The company is seeking a declaration that the decision to cancel the KVDT2 project and reopen the tender is null and void. Furthermore, they are pursuing orders to quash the termination decision and compel the government to execute necessary documents, alongside the stay of the termination and assessment of damages. The High Court has fixed April 28 for case management of these proceedings.

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What impact will the stay order have on the KVDT2 project tender?

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