REPORT ON THE SITUATION OF PTK’S CONTINUANCE TO WASTE PUBLIC FUNDS PREPARED BY THE ORGANIZATION FOR DEMOCRACY, ANTICORRUPTION AND DIGNITY “ÇOHU” – PART 1
 
Some of the main problems that have been identified recently in the PTK, are its CEO’s decisions to continue to waste public funds at his own will.  It is confirmed that these funds are being spent without use of any applicable laws of Kosovo, in particular his decision to send 40 (forty) PTK employees for ‘training purposes’ in the University of Kent without using the tendering process. This is estimated to cost PTK €400,000 (four hundred thousand Euros)

Our findings have established that PTK’s CEO was employed by the University of Kent – in the United Kingdom as a lecturer.  Sources close to Çohu! state that he has taken unpaid one year leave from his job as a junior lecturer in the University of Kent to come and work in PTK. Upon his commencement as CEO with PTK he decided to send 40 PTK employees to commence ‘telecommunication training’ at the University of Kent. No law was followed and the basic fundamental legal principles as defined by Public Procurement Law of Kosovo were met, namely:

1.  No publication for Expression of Interest – which normally would define the ‘training needs’ or ‘training modules’,  and
2.  No criteria outlined (based upon which a selection process would have been made)

Çohu submits that when CEO of PTK decides to ‘spend’ PTK’s  money there are ‘liabilities’ attached to such decision  e.g. under 1 above (Expression of Interest ).  PTK must send the expression of Interest to at least 3 reputable Universities clearly outlining the ‘training needs’ and that under 2 to clearly define how the best ‘offerer’ can win.

By way of such management we strongly believe that his thinking  is not in line with normal thinking, nevertheless , having secured the job upon his return to UK as junior lecturer) , the CEO decided that to  follow the law was inappropriate act. 

It is imminently clear that in order to decide to take any action for the benefit of PTK (or any other Publicly Owned enterprises – POE’s), whether purchase of goods or services the Kosovo Public Procurement law must be applied. For the avoidance of doubt PTK’s CEO purchased services from the University of Kent in the amount of € 400k without applying any laws. The question that remains unanswered is: why did the CEO choose the University of Kent?  Why there was no publication of ‘Expression of Interest’? Furthermore why this particular University where the CEO itself was lecturing?

Misuse of public funds in PTK is in a rise. Our questions and concerns are falling in deaf ears. Our reports have been ignored. No other alternatives are left but to ask your authority for the sake of your taxpayers money (in your respective countries) to take this matter further by commencing investigations in this matter without any further delays.
 
REPORT ON THE SITUATION OF PTK’S CONTINUANCE TO WASTE PUBLIC FUNDS PREPARED BY THE ORGANIZATION FOR DEMOCRACY, ANTICORRUPTION AND DIGNITY “ÇOHU” – PART 2

PTK's participation on the 4th GSM License in Albania

The second biggest unlawful decision of PTK’ CEO is his decision to participate in a bid for the 4th GSM License in Albania with local partners (from Albania).

This report outlines the detailed process.

It is obvious that in order for PTK to participate in such project there are some liabilities that need to be considered prior to commencing such initiative.

It is COHU’s  view that in order to participate as a part of consortium for any kind of joint venture projects, strategic alliance (taking into account PTK's status (i.e. being Publicly owned enterprise) there are some fundamental principles that needed to be followed. 

Çohu has managed to get information that a MEMO in regards to such request to participate on the 4th GSM License in Albania was sent by PTK Board of Directors to the PUBLICLY OWNED ENTERPRISE COMMITTEE. In this MEMO the Publicly Owned Enterprises Committee was asked for approval whether PTK has the right to expand its activities outside the territory of the Republic of Kosovo, using PTK’s experience in the field of mobile telephony.

The decision to enter into this process is a matter of a PTK’s owner – Government of Kosovo (rather then PTK Management) according to the applicable laws, who are responsible to approve the expansion of PTK’s activities (beyond those within PTK JSC’s charter) and to allow establishment of a new consortium with an ‘Albanian Investment Group’.  

Furthermore it is noted that in such communication 'pros and cons' of this project were put forward and that the Publicly Owned Enterprises Committee was to make a decision.
In this MEMO it was stated that PTK and its staff have no hands-on environmental public policy, legal, economic and telecommunications in the Republic of Albania so it is necessary to proceed through a request made by the owner of the PTK, and in cooperation with a potential relevant shareholder from the Republic of Albania. The advantage of an alliance/consortium is that the alliance partner can utilize existing procedures and functioning legal system and has the knowledge in the areas noted above. 
Cons and Risks

1.       PTK had no detailed business plan or costing analysis for this project.

2.       PTK had inadequate experience and limited management level staff to cope with all the logistics of doing an alliance. This is partly demonstrated by lack of follow through on other projects e.g. British Telecom (BT) and Cable and Wireless ( C&W)  Alliance. 

3.       PTK tends to rely on the foreign partner to produce papers and detailed analysis, while currently this project is at its initial phase.  This can be risky because this project is not detailed and finalized. 

4.       The telecommunication sector in Kosovo and Albania is already becoming more competitive so it will be difficult for another player to enter.

5.       PTK has noticed recently that the mobile telephony market is consolidated therefore entry in the market will be challenging.

6.       Majority of mobile operators in the region have been impacted by the global financial crisis in one way or another.

7.       As PTK is publicly owned there will be a perception that participation in the bidding for the 4th GSM license in Albania as a consortium might be open to “political influence” in recruitment and investment policy by pressure from politicians and this will deter many more serious players. There is also the perception (and reality) that PTK will be slow to move and not as nimble as a truly private player.  This was borne out by the other alliance negotiations where partners became frustrated by PTK’s decision-making and the lack of certainty of Kosovo’s legal structure and the need for referral to Kosovo Government for example.

8.       It is still unclear whether the new consortium to be established will, now or in future, be subject to the Public Procurement Law of Kosovo.
 

It is noted that all other members of this Consortium do not have the required experience to enter into telecommunication services and therefore they need a partner with telecommunication experience to qualify for the Bid.
It is noted that the Government of Albania has approved this tendering process and will award the license to PTK and its partners. This is to be treated as inappropriate action and misuse of public funds. 
Taking into account what is stated above we kindly ask you to commence investigation in this matter without any further delays.
 
 

REPORT ON THE SITUATION OF PTK’S CONTINUANCE TO WASTE PUBLIC FUNDS PREPARED BY THE ORGANIZATION FOR DEMOCRACY, ANTICORRUPTION AND DIGNITY “ÇOHU” – PART 3
 
The third unlawful decision of PTK’ CEO is his decision to ‘hire’  a gentlemen called Robin Jowitt as an adviser to help PTK in  entering into the BID for the 4th GSM tender License in Albania.
This is absurd, 
The CEO of PTK notwithstanding the fact that even starting the negotiations with potential partners to enter into ‘consortium agreement’ is an illegal act he invited Robin Jowitt a consultant at the company of Ernst and Young (Telecoms Consultants from UK)  to assist PTK to enter into this Project. How Mr.Jowitt was selected to advise PTK (Publicly Owned Enterprise) is unknown. Was there a tendering process followed to select advisers for PTK remains unknown. Last but not least based on what                  principles PTK’ CEO pays for the tickets for Mr.  Robin and his family to visit Kosovo at PTK’s cost.

This is totally unacceptable and action must be taken NOW

Prishtinë, 8 June, 2009