The World Bank says China-based Liaoning-EFACEC Electrical Equipment Company Limited (LEEEC) would be ineligible to participate in Bank-funded projects for 20 months due to fraudulent practices in connection with a project in Zambia.
The project is a US$ 210 million project consisting of the rehabilitation of the 132kV and 88kV transmission network in Lusaka Area and rehabilitation of the 33kV and 11kV distribution network in Lusaka Area and technical assistance and project supervision.
The debarment is part of a settlement agreement under which the company acknowledges responsibility for failing to disclose a conflict of interest and other “sanctionable practices”, and agrees to carry out remedial actions.
The case involves the Lusaka Transmission and Distribution Rehabilitation Project in Zambia, which was designed to increase the capacity and improve the reliability of the electricity transmission and distribution system in Lusaka, Zambia.
According to the facts of the case, LEEEC failed to disclose a conflict of interest and misrepresented its past contract experience to meet the requirements of a contract under the project, which is a fraudulent practice.
The settlement agreement provides for a reduced period of debarment in light of the company’s cooperation and voluntary remedial actions.
As a condition for release from sanction under the terms of the settlement agreement, the company commits to developing an integrity compliance program consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines.
The company also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.
The debarment of LEEEC qualifies for cross-debarment by other multilateral development banks (MDBs) under the Agreement for Mutual Enforcement of Debarment Decisions that was signed on April 9, 2010.
This is according to a statement released by the World Bank in Washington today.
Meanwhile, in a related development, the African Development Bank Group has announced the debarment of Sinotec Company Limited, an energy solutions company registered in China, for a period of 36 months for engaging in fraudulent practices.
The announcement, which was made on 20 April 2020, is pursuant to a decision by the Bank’s Sanctions Appeals Board.
An investigation conducted by the Bank’s Office of Integrity and Anti-Corruption established that Sinotec Company Limited misrepresented its experience, the value and dates of its reference contracts and its relationship with other bidders while participating in three Bank-financed tenders under the Regional Rusumo Falls Hydropower Project in Rwanda, the Uganda Rural Electricity Access Project, and the Last Mile Connectivity Project in Kenya.
At the expiry of the debarment period, Sinotec Company Limited will only be eligible to participate in Bank-financed projects on the condition that it implements an integrity compliance programme consistent with the Bank’s guidelines