Anti-bribery provisions for exporters under threat as MPs relax laws

Anti-corruption champion Transparency International (UK) has written to Economic and Business Minister, Ian Pearson, urging him to think again about planned changes to export guarantee laws that MPs vote on next week. An amendment to the Export and Investment Guarantees Act 1991 is due to be voted by the House of Commons on April 21st.

TI (UK) is concerned that in its attempt to change the Export Credit Guarantee Department’s (ECGD)’s export cover rules to help cushion UK exporters in the current recession, the Government is at risk of weakening the application of the ECGD’s anti-bribery rules. It is calling on the government to incorporate anti-bribery safeguards into the amendment.

The ECGD’s Business Principles include anti-bribery provisions which are meant to ensure that export contracts covered by Government guarantees adhere to high standards of business practice and avoid corrupt business activities.

However, if the amendment is adopted, it would be possible for a company to secure a contract through bribery and ask for retrospective cover from ECGD. In these circumstances, given the resources available to ECGD, retrospective due diligence would make it hard to uncover evidence of bribery. Moreover, the recent ECGD Bonny Island case has demonstrated that even where evidence of bribery does come to light retrospectively, the ECGD is powerless to act.

It is the second time this year that TI (UK) has expressed concern to the Business Minister over the Export Credit Guarantees Department’s approach to its anti-bribery provisions. In March, following massive fines paid in the USA by Halliburton over bribery in the Bonny Island contract, TI (UK) called on the ECGD to exclude companies implicated in bribery from future UK Government contracts.

The watchdog also called for an independent review of best practice in anti-bribery provisions across the world as part of this year’s planned review of the ECGD’s anti-bribery provisions – and for the ECGD to implement the review’s findings.

Chandrashekhar Krishnan, Executive Director of TI (UK) said:

‘The speed with which the Government has moved to relax these rules suggests a worrying trend for the ECGD to weaken the application of its Business Principles under pressure from export groups. Robust anti-bribery provisions can – and must - live compatibly with efforts to support UK exports.

‘It only reinforces the need for a thorough review of ECGD’s anti-bribery provisions. There must be no back-peddling on the review’s timing for this year.’

For more information or to arrange interviews, please contact:

Janice Allen, Communications Manager 0207 785 6356 or 07902 841 386

Janice.allen@transparency.org.uk

Robert Barrington, Director of External Relations, 0207 785 6360 or 07734 744 877 Robert.barrington@transparency.org.uk

Notes to the editor

1. The full text of the latest letter to Ian Pearson is available from robert.barrington@transparency.org.uk

Transparency International (UK) www.transparency.org.uk

Transparency International (TI) is the world’s leading non-governmental anti-corruption organisation. With more than 90 Chapters worldwide, TI has unparalleled global understanding and influence. Transparency International (UK) fights corruption by promoting change in values and attitudes at home and abroad, through programmes that draw on the UK’s unique position as a world political and business centre with close links to developing countries.

• We raise awareness about corruption

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