New ECGD procedures on bribery and corruption

Strengthened procedures to minimise the risk of bribery and corruption on business deals supported by the Export Credits Guarantee Department (ECGD) will come into force on 1 May 2004.

The measures – which aim to deter illegal payments to win overseas contracts, corrupt practices and also money laundering – underline ECGD’s continued commitment to combat bribery and corruption, and keep it at the forefront of international efforts within the Organisation for Economic Cooperation and Development.

They build on the significant strides made by ECGD in 2000 when it strengthened its anti-corruption measures to reflect international best practice.

They follow a further review of procedures required by Ministers in recent months.

Mike O’Brien, Minister for Trade, said: “These new measures ensure that the Government continues to play its part in rooting out wrong-doing in international business transactions.

“ECGD is at the forefront of Export Credit Agencies which are keen to eliminate unethical and illegal practices. But this further package of measures means the Department is being even more effective.”

And he added: “Bribery is not only wrong, it is bad for business. A culture of corruption is a disincentive to trade and investment and payment of bribes just makes the corrupt officials worse.

“This is a balanced package. It will be to the ultimate benefit of all UK companies.”

Under the new measures on bribery and corruption coming into force next month, ECGD will:

* Obtain additional information from applicants to ensure that no improper payments involving agents have been made to win contracts;

* Have greater rights to inspect exporters’ documents relating to winning contracts and any payments made to agents;

* Require applicants to provide ECGD with a copy of their Codes of Conduct if they have one, and to sign a declaration that they will not engage in corrupt activity and will take action against anyone found guilty of such;

* Applicants must also show that they have procedures in place to prevent corrupt activity and monitor compliance with their Codes of Conduct (or similar procedures);

* Extend the range of various declarations regarding corruption to include affiliates – i.e. any company which is a member of the same group of companies, or that is a party to any joint venture or consortium, as well as directors and employees in those companies;

* Require applicants to warrant that neither they nor, to the best of their knowledge, their affiliates have been convicted of, or admitted to, an offence of money laundering;

* Remind applicants of their legal obligations with all new ECGD cover application forms containing a statement of the UK laws on bribery and corruption, and money laundering; and,

* Remind applicants that all allegations of bribery and corruption, and money laundering will be referred to the appropriate authorities, which includes the National Criminal Intelligence Service.

Business Credit Management (UK), April 1, 2004

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