The World Bank has applied a 2009 debarment of a Chinese firm to its successor firm following recent changes in the World Bank sanctions system, effectively preventing the successor firm from engaging in any road and bridge projects financed by the World Bank Group until Jan. 12, 2017.
The World Bank sanctions system recently clarified that successor organizations – through purchase or reorganization – will be subject to the same sanctions applied to the original firm. In this particular case, China Communications Construction Co. Ltd. is the designated successor entity to China Road and Bridge Corp., which, along with six other firms and one individual, was debarred by the World Bank for eight years for fraudulent practices under the Philippines National Roads Improvement and Management Project’s first phase. The decision to debar CRBC came following an investigation by the bank’s Integrity Vice Presidency. The World Bank, however, said it did not disburse any funds to any of the sanctioned entities.
The World Bank has a cross-debarment agreement with other multilateral development banks, such that companies debarred by the World Bank Group can no longer seek business from other multilateral development banks. In fiscal 2010, INT conducted 117 investigations that resulted in the debarment of 45 firms and individuals for engaging in wrongdoing.
The bank has been working with the Chinese government on governance and anti-corruption matters. Earlier this year, China amended its criminal law to make it unlawful for Chinese companies, including those overseas, and Chinese nationals to bribe foreign government officials.
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