The World Bank on March 27 announced that it has imposed a one-year debarment on Vietnam Water and Environment Investment Corporation – JSC (VIWASEEN), a Vietnamese, state-owned water and sewerage company, concerning fraudulent practices in connection with the World Bank-financed Mekong Delta Water Resources Management for Rural Development Project and Urban Water Supply and Wastewater Project in Vietnam.
The Mekong Delta Water Resources Management for Rural Development Project, which closed in 2017, was designed to protect and enhance water resources in the Mekong Delta Region to boost agricultural productivity, provide access to water supply for rural households, and contribute to climate change adaptation. The Urban Water Supply and Wastewater Project, which will close in December, was designed to increase access to sustainable water services and environmental sanitation in urban areas.
According to the World Bank Group, VIWASEEN submitted its bids to win contracts under the projects and later transferred the entire works to its affiliates without informing or obtaining the proper approvals from the respective procurement agencies. The company also misrepresented its role as the executor of both contracts throughout the implementation period while the contracts were entirely executed by its affiliates. These are fraudulent practices under World Bank Procurement Guidelines.
The debarment, which makes VIWASEEN ineligible to participate in World Bank-financed projects, is part of a settlement agreement under which the company acknowledges responsibility for the underlying sanctionable practices and agrees to meet specified corporate compliance conditions as a condition for release from debarment.
Following the one-year debarment, VIWASEEN will be sanctioned with conditional non-debarment for eighteen months, which means that it will remain eligible to participate in World Bank-financed projects as long as it complies with its obligations under the settlement agreement. Otherwise, the conditional non-debarment will convert to a sanction of debarment with conditional release, and the company then will become ineligible to participate in World Bank-financed projects until the conditions for release set out in the settlement agreement are met.
The settlement agreement provides for a reduced period of sanction due to the company’s cooperation and acceptance of responsibility of its conduct, the World Bank stated. As a condition for release from sanction under the terms of the settlement agreement, the company commits to developing an integrity compliance program consistent with the principles set out in the World Bank Group Integrity Compliance Guidelines. The company also commits to continue to fully cooperate with the World Bank Group Integrity Vice Presidency.
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