Anti-corruption commitments in contracts
Contractual commitments to implement anti-corruption measures against the main types of corruption.
The project owner and each major contractor should provide contractual anti-corruption commitments which cover the main types of corruption, and which oblige the parties to implement anti-corruption measures. Remedies should be specified in the event of breach of these commitments.1
PURPOSE & LINK TO INTEGRITY
Anti-corruption commitments aim to prevent corrupt practices in public-private and private-private projects. Contractual anti-corruption commitments make the parties involved aware of the corruption risks and can be legally enforceable.1
By engaging in anti-corruption commitments, the organisation shows its zero tolerance of corruption and reduces the risk to be exposed to such risks when cooperating with partners.
- Are you aware of international and national anti-corruption policies? Does the anti-corruption commitment comply with these?
- Do you have adequate communication channels in place to ensure your staff’s awareness of the anti-corruption commitment?
- Do you have control mechanisms in place to ensure your staff’s compliance with anti-corruption commitments?
- Do you possess sufficient bargaining power to enforce the anti-corruption commitment vis-à-vis external partners?
The Global Infrastructure Anti-Corruption Centre (GIACC) makes the following recommendations in relation to project anti-corruption commitments on public sector projects:1
- Anti-corruption contractual commitments should be exchanged between:
- the project owner and each bidder for a major contract; and
- each major contractor and each bidder for its major sub-contracts.
- These commitments should be exchanged at the outset of each party’s involvement in the procurement process. They should continue to apply for the duration of each party’s involvement in the project.
- These commitments may be provided as a separate anti-corruption agreement, or as part of the tender documentation and/or project contract.
- Where any party is a joint venture, then the joint venture members should each join in the anti-corruption commitments.
- Any bidder who fails to provide these commitments should be disqualified from participation in the project.
- The anti-corruption commitments should be made by each party related to the project.
The anti-corruption commitments can include the following elements: 1
Honesty and fairness
- The involved party has acted, and will continue to act, at all times honestly and fairly.
- It has not acted, and will not act, dishonestly to cause loss to any party or to deprive any party of its rights.
Bribery and improper advantage
- It has not offered or given, and will not offer or give, directly or indirectly, any bribe or other improper benefit or advantage to any individual or organisation.
- It has not demanded or accepted, and will not demand or accept, directly or indirectly, any bribe or other improper benefit or advantage for itself or any individual or organisation.
- It has not made, and will not make, directly or indirectly, any payment except to the extent that such payment is legitimate compensation for legitimate services.
- It has not received, and will not receive, directly or indirectly, any payment except to the extent that such payment is legitimate compensation for legitimate services.
- It has not provided to any party, and will not provide to any party, any written or oral information which it knows to be false, inaccurate or misleading, or where it is wilfully blind or reckless as to whether the information is false, inaccurate or misleading.
- It has not dishonestly withheld from any party, and will not dishonestly withhold from any party, any written or oral information.
- It has not authorised or acquiesced in or turned a blind eye to, and will not authorise or acquiesce in or turn a blind eye to, any corruption.
Conflict of interest
- Neither it, nor any of its principal shareholders, senior officers or senior managers has any undisclosed actual or potential conflict of interest. It will disclose any future actual or potential conflict of interest.
- It has acted and will act impartially in carrying out any duty which requires it to act impartially, including:
- Evaluating tenders;
- Certifying payments, extensions of time, variations, or the value or quality of works, services or materials.
- In relation to provision of works, materials, equipment or services, it will not deliberately, with wilful blindness, or recklessly, carry out, authorise, condone or be party to:
- The provision of works, materials, equipment or services which are not of the quality and quantity contractually required;
- The concealment of defective work, material, equipment or services;
- Payment for non-existent or defective work, material, equipment or services.
- (It will submit only those claims which it honestly believes to be true and which can be reasonably substantiated by accurate written or oral evidence, and to which it believes it has a bona fide legal or contractual entitlement.
- The party receiving a claim will not dishonestly challenge or disregard the claim, and will promptly pay any sums, award any extensions of time, issue any certificates or take other steps which it honestly believes are due in relation to the claim.
- It will comply with the anti-corruption measures which apply to the project.
Penalties for corruption
- It will introduce and enforce contractual penalties for corruption in relation to its business partners and its officers and employees.
- It is aware that corruption may result in criminal liability for both organisations and individuals and that the penalties for such liability may be severe and may include imprisonment for individuals and fines for organisations.
Passing-down of commitments
- [This commitment should be provided only by each tenderer for a major contract to the project owner.] It will obtain the above contractual commitments from each of its major sub-contractors, agents and related companies and will take reasonable steps to enforce these commitments.
KEY GUIDING DOCUMENTS
GIACC, 2008, PS 5: Project anti-corruption commitments, Global Infrastructure Anti-Corruption Centre (GIACC), http://www.giaccentre.org/PACS_PS5.php, accessed 02.12.2015
UNODC, 2013, An Anti-Corruption Ethics and Compliance Programme for Businesses – A Practical Guide, United Nations Office on Drugs and Crime (UNODC)
UN Global Compact, no year, www.unglobalcompact.org/, accessed 02.12.2015
OECD, 2011, OECD Guidelines for Multinational Enterprises, Organisation for Economic Cooperation and Development (OECD) Publishing, http://www.oecd.org/daf/inv/mne/48004323.pdf, accessed 02.12.2015
- GIACC, 2008, PS 5: Project anti-corruption commitments, Global Infrastructure Anti-Corruption Centre (GIACC), http://www.giaccentre.org/PACS_PS5.php, accessed 02.12.2015