“I merely would like to place it on record that I did not in any way influence the technical terms to select or de-select any products that were offered to the various prime contractors,” Shaik told the inquiry in Pretoria.
“I maintain that I acted appropriately and within my acquisition mandate at the time.”
In a sworn statement to the inquiry, Shaik said he had been advised that there would not be any conflict of interest regarding his acquisition role and his brother Schabir’s company Altech Defence Systems which later became African Defence Systems (ADS).
ADS was awarded the contract to supply combat systems for frigates.
“I sought a legal opinion on this issue, which confirmed that I had no conflict of interest in the procurement process,” said Shaik.
“I had disclosed my brother’s business association with Thompson South Africa and recused myself from any decision relating to the combat suite.”
Richard Young, a losing bidder in the multi-billion rand arms procurement process and outspoken critic of the deal, has accused Chippy Shaik of playing an improper role in the selection of the contractors for the combat suite.
Shaik rubbished the allegations. He said he knew the issue of his failure to recuse himself from the deal was in the public domain.
“It became a bit messy on the issue of proper recusal, non-recusal etc. I had no conflict of interest, I had no interest or shares in any company so I could have no conflict [of interests’,” he said.
He was aware the losing contractor, Young’s company, had made the allegations of improper influences.
“On the issue of the potential bias, on the very first meeting of the project control board, I made a disclosure that a French company, Thompson, had bought an equity stake in Altech Defence Systems,” he said.
“It is because of that association, there was a perceived bias.”
Government acquired, among other hardware, 26 Gripen fighter aircraft and 24 Hawk lead-in fighter trainer aircraft for the SA Air Force, and frigates and submarines for the SA Navy.
In February 2007, Germany’s Der Spiegel magazine reported that German prosecutors were in possession of internal memos from Thyssen detailing meetings where Shaik allegedly demanded payment of US3 million to ensure the success of the German bid for the contract to build South Africa’s four corvettes.
The magazine detailed allegations that Shaik requested the bribe in 1998 and that in 2000, the company apparently deposited the money to a non-existent company in London.
In 2002, Shaik resigned from the public service after an inquiry found that he acted improperly by disclosing confidential information contained in the auditor general’s draft report on the arms deal to his own lawyers.
The commission — chaired by Judge Willie Seriti — was appointed by President Jacob Zuma three years ago.
Zuma recently extended the term of the commission until April 30, 2015, after which it would be expected to issue a report within a six-month deadline.
Schabir Shaik is Zuma’s former financial adviser. He was sent to jail in 2006 for facilitating a bribe from the French arms company Thomson-CSF to Zuma. Schabir Shaik has since been released on medical parole. Chippy Shaik is now based in Perth, Australia.