Attorney General warns against terminating contract of Entebbe Expressway toll operator

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Menu E-PAPER News Business Technology Education Lifestyle Open dropdown menu Entertainment View Point Open dropdown menu Editorial Sports Topics The Observer August 19-25, 2026 Open Search Search for: Search Posted inNews Attorney General warns against terminating contract of Entebbe Expressway toll operator by URN August 28, 2026August 28, 2026 Share this: Share on Facebook (Opens in new window) Facebook Share on X (Opens in new window) X Print (Opens in new window) Print Share on WhatsApp (Opens in new window) WhatsApp Vehicles queueing at Entebbe Express toll gate Uganda risks a costly international arbitration if it terminates the contract of a private operator managing toll collection and operations on the Kampala-Entebbe Expressway, the Attorney General has warned.

This week, parliament’s committee on physical infrastructure, chaired by Mwine Mpaka, called for the immediate termination of French company EGIS Road Operation S.A., which was contracted by the Uganda National Roads Authority (Unra) on April 13, 2021, to operate and maintain the expressway.

Dissatisfied with EGIS’s performance, the committee made at least 14 recommendations, including transferring operations and toll collection on the 24-kilometre expressway to the ministry of Works and Transport.

The committee also wants the Uganda Revenue Authority (URA) to take over toll collection, arguing that direct government control would reduce the cost of private contractual arrangements and free up more resources to service the debt incurred to finance the expressway.

EGIS’s five-year contract, valued at Shs 122.86 billion, took effect on May 24, 2021 and provides for a possible extension of up to 24 months, subject to satisfactory performance.

However, in a response presented to parliament, deputy Attorney General Jackson Karugaba Kafuuzi said government cannot simply terminate a valid contract without first establishing that the operator has committed a persistent breach and following the termination procedure provided for in the agreement.

Kafuuzi told parliament that EGIS must first be formally notified of any breach and given 14 days to remedy it. Where improvement works are delayed, the contract provides for liquidated damages and reductions in payments.

Termination on grounds of persistent failure, he said, can only arise after specified contractual thresholds have been reached.

Kafuuzi instead advised the ministry of Works and Transport to undertake a comprehensive assessment to establish whether EGIS’s failures meet the contractual threshold for termination.

EGIS’s obligations extend beyond toll collection to include road-safety improvements, lighting, tolling infrastructure, an independent traffic monitoring system, an automatic vehicle classifier and systems for controlling overloaded vehicles.

The committee found that several of these obligations had not been fully implemented.

MPs cited incomplete installation of the independent traffic monitoring system and automatic vehicle classifier, inadequate carriageway lighting and road-reserve fencing, as well as shortcomings in the high-speed weigh-in-motion systems.

The committee argued that the failures justified taking the expressway back under direct government management. Although Kafuuzi acknowledged that failure to complete works within agreed timelines constitutes a contractual breach, he stressed that a breach does not, by itself, trigger immediate termination.

The legal response also challenges Parliament’s concerns over the extension of a related contract involving Pinnacle Security Limited. The committee recommended an investigation into the former permanent secretary over what it described as an illegal Shs 36.3 billion extension allegedly granted without the Attorney General’s approval.

The Attorney General’s office disputes that finding, saying the ministry of Works and Transport extended the contract through a letter dated May 20, 2026, with the extension running from May 24, 2026 to May 24, 2027.

According to the legal opinion, the extension was provided for under Clause PCC 39.1 of the original agreement and did not introduce additional expenditure.

The Shs 36.3 billion cited by the committee, the office said, formed part of the original contract price, making the extension a “no-cost extension” that did not require fresh legal clearance.