UAE company wins controversial R122m airport tender in Zanzibar

• An aviation company was allegedly handpicked without going to tender and didn't have a licence for ground handling services in Zanzibar, Tanzania.
• Dnata was added as third firm for handling services when, by law, only two companies should do so.
• The opposition in Tanzania urged the government to make details of the contract public.

Dnata, a subsidiary of the sprawling Emirates Group conglomerate, has been rocked by controversy in Zanzibar, Tanzania, after it emerged that officials flouted a series of aviation regulations in order to award the company a $7-million (about R122 million) aviation tender.

In November last year, Dnata signed a contract with authorities in Zanzibar to provide ground handling services at the newly built terminal three of the Abeid Amani Kurume International Airport.

As part of the contract, two other Emirates subsidiaries, Emirates Leisure Retail and MMI will operate all 13 retail facilities and two lounges in the terminal.

The facilities include restaurants, as well as duty-free and commercial outlets. 

An investigation by News24 has established that Dnata's contract flouted a series of civil aviation regulations in that:

When the contract was signed in November, Dnata issued a statement saying the company was expanding into Africa.

In a press statement, the company said at the time: 

The company's vice president, Steve Allen, at the time said: "We are thrilled to expand our global footprint into Africa and establish operations at the airport of Zanzibar. We are confident that our investment in the local aviation industry will stimulate tourism and trade, delivering significant benefits for Zanzibar businesses and the local community."

Dnata has since registered a local Zanzibari subsidiary, Dnata Zanzibar Aviation Services. The company, registered at the end of January, was earlier this month granted a licence to operate ground handling services.

Dnata did not respond to questions about how it was awarded an exclusive contract, without tender processes, to run ground handling operations and retail facilities at the airport.

Instead, the company commented on Dnata Zanzibar Aviation Services’ licencing to run ground handling operations. 

In an emailed response, the company told News24:

"Dnata Zanzibar has followed the established process and related regulations issued by TCAA and Zanzibar Airport Authority (ZAA) applicable to the ground handling concession and corresponding license. Dnata Zanzibar has also fulfilled all prerequisite safety requirements to consistently run high-quality and safe operations at ZNZ.

"Dnata Zanzibar will continue to work closely with the authorities and other relevant stakeholders to ensure continued full compliance with all applicable laws and regulations in all aspects of its ground handling operations and services. Dnata Zanzibar ground handling operations are different from those operations of Emirates Leisure Retail (ELR) and MMI related to food and beverage, duty-free and commercial outlets at Terminal 3 at ZNZ."

'It cannot piggyback'

However, TCAA director-general Hamza Johari told News24 that Dnata had never been granted a licence in Tanzania. 

"Dnata UAE has never been granted any licence to operate in Tanzania. It's not true that Dnata UAE has been given an exclusive contract to operate because that company has no licence, so it is not possible.

"Dnata Zanzibar is the one which applied for a licence recently, and was granted on 2 June 2022. The next step is for Dnata Zanzibar to go through a concessioning process with the Zanzibar Airport Authority (ZAA). You have to have a licence first, then the concession follows," he said.

Only locally registered companies qualify for a license to trade as a ground handling service provider.

Dnata Zanzibar, Johari said, had met all the requirements to be licenced as a ground handling service provider.

Ismail Jussa, a member of the central committee of the Alliance for Change and Transparency - an opposition party in Tanzania - said the agreement between Dnata UAE and the government of Zanzibar was suspicious. 

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"There are so many unanswered questions. Why did the contract not go to tender? Why was Dnata UAE given an exclusive contract when regulations are against it? Why was Dnata UAE given the concession to run ground handling services when they don’t have a licence to work as ground handling operators?" he queried.

Jussa said Dnata could not use Dnata Zanzibar Aviation Services’ licence to run ground handling services as the companies were two separate legal entities.

Dnata Zanzibar Aviation Services had to go look for a ground handling contract of its own, he said. 

"It cannot piggyback on Dnata’s illegal contract, as the two are different legal entities registered in two different countries. We urge the government of Zanzibar to tell us what’s going on here."

A local businessman, who didn’t want to be quoted for fear of reprisals, said Dnata Zanzibar Aviation Services should not have been granted an operating licence, as 35% of the company’s shares were not wholly owned by Tanzanians.

Tanzanian company registration documents seen by News24 show that a company called Maxima Corporation Limited owned 35% shares in Dnata Zanzibar.

However, Maxima’s shares are not wholly owned by Tanzanians. Four percent of the company’s shares belong to an Indian citizen, Sufiyan Aiyub Hafej.

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