The report by Committee on Public Finance looking into the visa issue linked to VFS Global has been released to public.
“COPF report reveals major flaws in procurement for online visa applications. Lack of competition, data breaches, missing USD 200m investment… demand urgent action” Committee Chairman MP Harsha de Silva said releasing the document.
EXECUTIVE SUMMARY
1.1 The appointment of GBS Technology Services & IVS Global-FZCO and its technical partner VF Worldwide Holdings Ltd (the Consortium) as the authorised representatives for online visa applications was initially discussed in Parliament on November 23, 2023. This matter continued to be a topic of extensive discussion thereafter, engaging citizens, civil society, and the media.
1.2 The Committee on Public Finance (COPF) unanimously agreed to examine the appointment of the Consortium as the authorised representatives for online visa applications to Sri Lanka on May 7, 2024.
1.3 The Consortium’s proposal was initially received by the Ministry of Defence in March 2022.
VFS Global and GBS-IVS subsequently submitted a letter to the Ministry of Foreign Affairs in October 2022. This letter proposed a marketing plan to boost tourist arrivals through their Electronic Travel Authorization (ETA) platform, at no cost to the Government of Sri Lanka. The Consortium had submitted an unsolicited project proposal to the Ministry of Public Security (MOPS) in June 2023,aimed at providing visa services, biometric services, and promoting tourism in Sri Lanka. Following Cabinet approval, the Outsourcing Agreement between the Consortium and the Controller General of the Department of Immigration and Emigration (DOIE) was signed on December 21, 2023.
1.4 Prior to receiving the proposal from the Consortium, a Cabinet Appointed Negotiation Committee (CANC) was established to assess a proposal submitted by Mobitel (Pvt) Ltd.
(Mobitel) in November 2020 and to oversee the development of the System Specification Requirement (SSR) by the DOIE. However, both Mobitel and the Consortium submitted their proposals before the finalisation of the SSR. Nevertheless, the Consortium’s proposal was accepted. This raises concerns regarding the process by which proposals were submitted without a finalised SSR.
1.5 COPF’s review identified that the proposal submitted by the Consortium in 2023 did not undergo any competitive bidding process. Additionally, the marketing plan to boost tourist arrivals, which had bypassed the Sri Lanka Tourist Board (SLTB), never materialised, leaving the promised benefit of increased tourist arrivals unrealized as outlined in the June 2023 proposal.
1.6 During the COPF meeting, Mobitel highlighted that they were the ETA service provider since 2012, and submitted proposals for system improvements in July 2020 (revised in November 2020) and again in August 2023. The latter proposal addressed all of DOIE’s requirements. However, despite Mobitel’s claim of having the necessary technological capacity and requesting upgrades since 2018, DOIE asserted Mobitel lacked the required capabilities. This indicated a significant communication gap between the two parties.
1.7 COPF’s review of documents revealed a potential contradiction. A Cabinet decision dated January 22, 2020, authorised Travelson International Travel Service (Shanghai) Company Limited to handle ETA applications specifically for Chinese nationals. This existing agreement raises concerns about a potential conflict with the role of the Consortium, designated as the exclusive facilitator for the DOIE.
1.8 Following the handing over of services to the Consortium, a popular travel vlogger ‘TrekTrendy’ Will Davis (with over 1 million subscribers on YouTube) reported a significant data breach in May 2024.
1.9 Conclusion: The absence of competition in the procurement process very likely resulted in an agreement that did not provide the best value for money. Additionally, there are issues relating to the fee structures, the procurement process including technical and software specifications,contractual agreements, potential financial and data security risks, the ambiguous investment of USD 200 million by the Consortium, and its exclusivity.
1.10 Recommendations: In light of the concerns identified in Section 1.9 Conclusion above,COPF recommends a comprehensive forensic audit by the Auditor General’s Office. The audit objective is to conclusively determine the outcomes of this report, enabling the authorities to take necessary action.
Full Report 👇