Conditional Non-Debarment in Da Nang Sustainable City Development Project

In the Sanctions Board Decision No. 142R, issued on February 29, 2024, the World Bank Group imposed a conditional non-debarment on a respondent involved in the Da Nang Sustainable City Development Project in Vietnam. The case revolved around allegations of corrupt and collusive practices during the procurement process for consulting services related to the project.

Contentions of the INT: The Integrity Vice Presidency (INT) alleged that the respondent engaged in corrupt practices by soliciting payments from potential bidders in exchange for favorable treatment in drafting procurement documents. Additionally, INT claimed the respondent was involved in collusive practices by sharing confidential bidding information and advising bidders on technical specifications that gave them an unfair competitive advantage.

Contentions of the Respondent: The respondent contested these allegations, arguing that the charges were vague and lacked a clear definition. The respondent also claimed that any misconduct was due to actions by a rogue employee (the Manager) and not a result of corporate policy or directives.

Analysis of Evidence: The Sanctions Board reviewed the evidence and found that the Manager, acting on behalf of the respondent, solicited payments from bidders and engaged in collusive practices. The Board rejected the respondent's argument of a rogue employee defense, concluding that the Manager's actions fell within her scope of employment, and the respondent failed to implement adequate controls to prevent such misconduct.

Determination: The Board determined that the respondent's actions warranted a conditional non-debarment, emphasizing that the misconduct was severe but considering mitigating factors such as the respondent's minor role, improvements in its compliance program, and significant changes in management and corporate structure since the time of the misconduct. The respondent is required to meet specific conditions within the non-debarment period, failing which it will face debarment with conditional release for a minimum of one year.

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