The Ministry of Transport, Highways and Urban Development has blacklisted four prominent building contractors this week, barring them from participating in tenders for periods ranging from six months to three years.
This marks the first time such disciplinary action has been taken within the highways sector. The companies—M/s Consulting Engineers & Contractors (Pvt) Ltd (three years), M/s V.V. Karunaratne & Company (one year), M/s HOVAEL Construction (Pvt) Ltd (one year), and W.K.K. Engineering Company (Pvt) Ltd (six months)—are also prohibited from entering into any new contracts or subcontracts under the Ministry’s purview during the respective debarment periods.
These sanctions were imposed under Chapter 10.2 (B) of the new Procurement Guidelines, which were issued in 2024 and came into force in January this year.
All four firms hold CS2 status—the highest grade awarded by the Construction Industry Development Authority (CIDA). According to a Cabinet paper accessed by the Sunday Times, three of the companies are alleged to have submitted false information in order to secure a contract under Section 3 of the Central Expressway Project.
The entities retain the right to appeal. The cited procurement guideline section outlines the sanction, debarment, and blacklisting procedure, specifying that action may only be taken after the affected parties have been given the opportunity to show cause. The rules also require the reasons for any sanction to be verified by an independent committee.
Documents seen by the Sunday Times indicate that the required procedures were followed, including the appointment of an independent committee, review of supporting documents submitted by the firms, a hearing held on October 10, 2025, and subsequent related correspondence.
In September, the Sunday Times reported that Cabinet directed the Highways Ministry Secretary to adopt “appropriate procedural steps” to address alleged fraudulent and corrupt practices involving these contractors. Cabinet also endorsed Highways Minister Bimal Ratnayake’s proposal instructing the National Procurement Commission and CIDA to “take action accordingly.”
In his Cabinet memorandum, Minister Ratnayake noted that the standing high-level procurement committee recommended action against the bidders “based on the submission of documents with their technical bids containing elements of fraud and corrupt practices,” as identified by the bid evaluation committee.
The updated procurement guidelines aim to curb fraud and malpractices in public procurement. They empower authorities to sanction, debar, or blacklist bidders, suppliers, contractors, and service providers who violate procurement rules or the terms and conditions of relevant documents.
Additionally, disciplinary measures may be taken against officers involved in public procurement processes if they breach procurement ethics or the guidelines.
Among the violations listed in the guidelines that can lead to sanction, debarment, or blacklisting is the “submission of eligibility and qualification requirements containing false information or falsified documents.”
