KUALA LUMPUR: One of the highlights in PricewaterhouseCoopers (PwC) report is the slew of companies and personalities involved in the controversial Port Klang Free Zone (PKFZ) project that are also associated with Kuala Dimensi Sdn Bhd (KDSB) or tied to transactions with the main turnkey contractor.

The parties with potential conflict of interests range from the board of directors to the quantity surveyor and legal firms who had at one point or another done work for or associated with KDSB or the land that the Port Klang Authority (PKA) acquired from the former.

One of the individuals was Sementa assemblyman Datuk Abdul Rahman Palil who was a board member from 1997 to 2003.

PwC noted in its report that Abdul Rahman had declared his position as the president of the Koperasi Pembangunan Pulau Lumut Bhd (KPPLB), who is the original owner of the land, in one board meeting and he went on to query the proposal for compulsory acquisition of the land over direct purchase.

“Given that compulsory acquisition would have benefited PKA, the rationale for Abdul Rahman’s raising the query is unclear,” said the report.

Datuk Chor Chee Heung’s position also gave rise to conflict as he was non-executive deputy chairman of Wijaya Baru Global Bhd (WBGB) from April 2004 to July 2007 and PKA chairman from April 2007 to March 2008.

WBGB and KDSB are connected through a common shareholder and director. WBGB and the parent company of KDSB, Wijaya Baru Holdings Sdn Bhd (WBHSB), share a common shareholder and director in Datuk Seri Tiong King Sing. In addition, two directors of KDSB, Omar Latip and Idris Mat Jani were also shareholders of Wijaya Baru Sdn Bhd (WBSB). WBSB is a 45%-associate of WBGB and is the main contractor of KDSB for this project.

“In February 2008, the final account of the DA3 (the supplemental development agreement to expand scope of development from 400 acres to 1,000 acres) of RM1.216 billion was approved by the board. KDSB carried out the construction works under the DA3 during the period from July 2004 to November 2006, during which Chor was the non-executive chairman of WBGB,” said PwC, adding that the minutes of the board did not indicate that Chor, who is the current deputy finance minister, either declared his previous involvement in WBGB to the board or withdrew himself from the deliberations.

Perunding BE Sdn Bhd, which is a member of the consortium of quantity surveyors appointed by PKA to, among other things, assess and determine the final cost of the project also acted for KDSB in relation to the infrastructure work under the LA1 (the supplemental land agreement signed between PKA and KDSB for purchase of 1,000 acres).

“Given its prior involvement as KDSB quantity surveyor, Perunding BE may have put itself in a position of conflict of interest,” said PwC.

Rashid Asari & Co acted as PKA’s legal adviser in some agreements. The legal firm also acted in the sale and purchase of part of the land between KPPLB and KDSB in 1995.

“Good practice would require this earlier involvement to be declared to the PKA board prior to the firm’s appointment as PKA’s legal advisers,” said the report. It was also highlighted that while PKA does not have a written policy of using only members of its legal panel, Rashid Asari & Co was not on the panel at the time of the appointment.