The Ministry of Works and Transport (MoWT) has officially taken over seven vehicle inspection stations from M/S SGS Company, following the termination of their mandatory vehicle inspection contract in 2020.
This move comes after a compensation package of over Shs109 billion was finalized in 2023, with 30% of the payment already disbursed.
As part of the agreement, SGS completed the reinstallation of vehicle inspection equipment and formally handed over the facilities to the Ministry of Works and Transport.
The inspection stations are strategically located in Namanve, Namulanda, Nabbingo, Kawanda, Gulu, Mbarara, and Mbale.
According to the Ministry, these stations will be utilized for mandatory motor vehicle inspections and fitment centers for digital registration plates under the Intelligent Transport Management System (ITMS) Project.
“This initiative aims to enhance road safety and protect the environment by ensuring all vehicles in the country meet road worthiness and environmental standards,” they said.
Initially, the government had entered into a five-year memorandum of understanding with SGS to conduct motor vehicle inspections.
However, the contract was terminated due to corruption scandals uncovered by Parliament, which led SGS to invoke contractual clauses and demand compensation for the installed equipment that was never used.
The SGS company, which began operations in 2015 with a mandate to improve road safety through vehicle inspections, faced a lot of shortcomings from the Parliament questioning its outrageous fees charged.
In 2017, the parliament tasked the attorney general to look into the possibility of terminating the US$ 125 million contract between the Works Ministry and SGS following recommendations by a minority report of the Physical Infrastructure Committee on grounds of fraud and unethical conduct.
The minority report contradicted the main committee report, which recommended the suspension of the contract for three months to allow for review and renegotiation between SGS and the Works Ministry.
The Ministry of Works and Transport Permanent Secretary, Waiswa Bageya, explained that SGS was compensated for the equipment but had terminated the contract after setting up inspection centers across various roads.
Once SGS is fully compensated, the government will own the inspection center and enforce mandatory vehicle tests to reduce road accidents.
