News24.com (Sapa-AFP)
October 28, 2002

Maseru – The Lesotho High Court fined Canadian engineering firm Acres International more than $2m on Monday in a landmark case for bribery in a major water project in the southern African kingdom.

A lawyer representing the firm indicated he would appeal the sentence, saying the “prosecution has become a persecution.”

Judge Mahapela Lehohla said before imposing the fine: “The court wants to send a clear message that companies wanting contracts should not even think of taking a risk in trying to bribe officials”.

The judgment and fine were landmark decisions according to Fiona Darroch, a London-based barrister attending the trial on behalf of several international non-governmental organisations.

“This is entirely unprecedented. This has not happened anywhere else in Africa as far as we know,” she said.

The Ontario-based company, which had denied the charges, was fined for its part in bribing the former head of the Lesotho Highlands Development Authority, Masupha Sole, through an agent from 1991 to 1998.

“In my view heavy sentences are needed when bribery and corruption has been detected,” Lehohla said.

He slammed Acres, saying that comments by some of its senior officials, who said the trial highlighted the risk Canadian companies ran when doing business in a country like Lesotho, were nothing short of “contempt”.

“There is a total absence of remorse. All that Acres appears to regret was that it was caught,” Lehohla said.

But Sytzke Alkema, an advocate representing Acres told the court: “The prosecution in this trial has become a persecution.”

A lawyer involved in the trial, who asked not to be named, said: “It’s as simple as that. The prosecution thinks we are guilty and we remain convinced that we are not.”

Acres was found guilty on two counts of bribery last month for paying money to Sole through its agent, Zalisiwonga Bam, who received more than $436 000 in payment.

Documents before the court said Sole received about 60% of that amount, while Bam, who died in 1999, received 40%.

Lehohla fined the company about $2.2m.

In his judgment last month, Lehohla said the company paid money to Sole through intermediaries to secure lucrative contracts for the construction of the Lesotho Highlands Water Project, which supplies water to South Africa, which surrounds Lesotho, and also generates electricity.

Lehohla said on Monday that Acres was the first international company, so far as he could remember, to be convicted of bribing an official.

“This is the first time a first world company (operating) in the third world has been convicted of bribing a public official. The amount is staggering…and great harm has been done to Lesotho,” he said.

Sole was sentenced to 18 years in jail in June for taking bribes of more than $1m from international consultants and contractors in Britain, Canada, France, Germany and the United States.

Other cases are pending against multinationals, and guilty verdicts are likely to jeopardise participation in projects financed by international institutions such as the World Bank and the International Monetary Fund.

Leaba Thetsane, Lesotho’s director of public prosecutions, said: “We are planning to prosecute all of them.”

The Swiss-Swedish engineering group ABB is accused of paying $40 410 in bribes and its French rival Bouygues is accused, with a consortium of seven other companies, of paying $733 404.

The Lesotho Highlands Water Project is also made up of British firms Keir International and Stirling International, South African firms Concor and Group Five, Italy’s Impregilo and the German company Hochtief.

French groups Spie Batignolles and Dumez International are accused of paying bribes of $119 393 and $82 422 respectively; Italy’s Impregilo $250 000 and German groups Lahmeyer International, Diwi Consulting and ED Zublin, payments of $8 674, $2 439; and $2 439 respectively.

Another consortium, Lesotho Highlands Project Contractors, is accused of making payments of $57 269. It includes British firm Balfour Beatty, as well as Spie Batignolles and ED Zub.