KAMPALA UGANDA: 13 October 2026— The Minister for Defence and Veterans Affairs, Hon. Kiryowa Kiwanuka, alongside the Board of Directors of the National Enterprise Corporation (NEC), today appeared before the Parliamentary Committee on Physical Infrastructure to clarify the status of the Intelligent Transport Monitoring System (ITMS), commonly known as the digital number plates project.
Appearing before the committee, the Minister clarified the history of engagements between NEC and the project’s contractor, Russian firm Joint Stock Company Global Security (JSC GS), emphasizing that NEC has never actually participated in the implementation or operation of the system.
Minister Kiryowa detailed the history of engagements between the two entities, which began with an initial exploratory agreement:
March 2019 Memorandum of Understanding (MoU): NEC and JSC GS signed a temporary MoU to facilitate technology transfer and kickstart preliminary discussions for an ITMS. Under Article 1(b), this MoU was non-binding, did not constitute a contract, and lapsed after six months without a Joint Venture Agreement being finalized.
November 2023 Cooperation Agreement: Four years later, the two entities revived negotiations and signed a formal Cooperation Agreement to partner in establishing, upgrading, and operating the ITMS. Under Article 5 of this agreement, NEC was entitled to receive 5% of the fines and penalties collected from the system in exchange for its participation.
“The Cooperation Agreement established a subsequent contractual framework between NEC and JSC GS, distinct from the 2019 MoU, and contemplated NEC’s substantive participation in the ITMS project,” Minister Kiryowa explained.
Non-Performance and Material Breach
Despite the formal 2023 agreement, Minister Kiryowa informed lawmakers that the partnership never materialized on the ground. He cited four primary obligations under the Cooperation Agreement that were never executed:
Unused Land: The land NEC offered to provide under Article 2.1(i) was never utilized for the project.
No Joint Venture: The joint venture entity agreed upon under Article 5 was never established.
No Operational Integration: NEC was never integrated into the actual setup, installation, or daily operations of the ITMS.
No Revenue Received: Because NEC was excluded from operations, it has not received its 5% share of collected fines and penalties or exercised any contractual rights.
“The failure by JSC GS to undertake the agreed obligations necessary to operationalise the partnership and involve NEC in the ITMS project raises significant concerns regarding non-performance and material breach of the Cooperation Agreement,” stated Minister Kiryowa.
The Defence Minister conclusively dismissed allegations linking NEC to the execution or oversight of the digital number plates roll-out.
He reiterated that the contractor’s failure to form the required Joint Venture effectively blocked NEC from fulfilling its mandate and realizing its expected commercial returns. As a result, NEC maintains zero operational involvement in Uganda’s current digital number plates system.
